In a recent interview Putin answering the question about his opinion on sanctions claimed that he “does not give a damn”. In his opinion, economic sanctions were even profitable as they let diversify Russian national economy.
It is interesting that almost simultaneously with this statement in Russia have begun to talk about joint efforts of all countries against pandemic and, as the result, — about global process of sanctions’ lifting.
Although it does not make clear, if sanctions cause such beneficial effect on Russian economy, on what purpose they should be cancelled?
The reason is simple — during the ongoing crisis Putin is looking for possible way to come back to the club of world leaders for the purpose of making a deal and dividing world on zones of influence once again. That is the reason why Crimea was annexed and war on Ukraine, Syria and even Libya was made. Putin still cannot cope with the fact that Russia with its raw-material-based economy, which depends on Western investments and technologies, does not correspond to world leadership at all.
At particular moment the Kremlin decided that if it collapses oil prices, the US gets asymmetric answer, for the North Stream 2 as well. However, it seems they bet on the wrong horse much. And even though American shale industry may really face with some difficulties now, it has already hedged the risks in January, this year. Now the reduction of oil prices is a problem of investment companies, which, by the way, will be supported by reducing of the tax burden. Moreover, the process of prices’ reduction is far from being unambiguous. American economy is up to get a cost saving of milliards of dollars while importing oil. Welfare of American families will rise by 6%, minimum, and there will be enough of funds to finance shale industry.
Furthermore, the US is thinking again on imposing of additional sanctions against Russian oil companies. Since sanctions against two subsidiary Rosneft companies were imposed, the threat is quite real. This step allows Americans oust Russian oil from the European market, which is much in the foreground for Russians. Hence, the Kremlin has shot itself in the foot when pulled out of the deal with OPEC+.
The pandemic has become one more issue that interfered with Putin’s plans. Unknown Chinese coronavirus has unexpectedly destroyed Putin’s dodgy plan to gather heads of leading world countries in Moscow under the pretence of honoring the 75th anniversary of the victory in World War II. Such an excellent opportunity to clean up an image and reach backdoor agreements! But now it is irretrievably lost.
Besides, there is one more extremely unpleasant prospect — the trial on MH17 case in The Hague that has already begun. It looks like Putin counted on the 9 May informal meeting with leading world politicians much, in order to convince them in some way to mitigate a verdict of guilty.
And finally, economic and financial crisis, that keeps exacerbate, has struck Russian raw-material economy. Oil price crash threatens Russia with budget crunch and loss of about 3 trillion rubles (~42$ billion). Russian oil Urals has already being traded at 22$, and nobody buys.
It is obvious that all attempts made by Putin to clean up his image, raise his rating, get rid of sanctions imposed for aggression and numerous violations of international law with a help of blackmail and backdoor agreements remain unsuccessful. Considering these facts, Russia’s claims on world leadership sound at least ridiculous, its aggressive politics and insistent striving for dividing world on zones of influence is a serious threat to the international security system.
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