Vladimir Putin Says West’s Attempt to ‘Crush the Russian Economy’ Did Not Succeed
The Russian ruble hit a seven-year high against the U.S. dollar last week, and while analysts are downplaying the gains, one economist said people “should not ignore the exchange rate.” U.S. economists are puzzled by the ruble’s market value, and Russian officials are saying that a stronger ruble will “make Russian exports more expensive.” In addition, U.S. President Joe Biden continues to blame Putin for the high gasoline prices.
Vladimir Putin says Western sanctions clearly “did not succeed”
Against the U.S. dollar, the Russian ruble is at its strongest level since May 2015, and many say Western sanctions have failed. At the annual St. Petersburg International Economic Forum, Russian President Vladimir Putin said attempts to destroy the Russian economy had not borne fruit.” The idea of violently crushing the Russian economy was clear,” Putin declared.” They did not succeed. Obviously, it did not materialize.” Traditionally, when a country is subjected to widespread sanctions from the majority of countries, capital flows out of the region and the overall value of the currency against other fiat currencies declines.
However, Russia is the
second largest oil exporter and the largest gas exporter in the world. The U.S. and the EU are desperate to sanction Russia, but the EU is forced to buy gas and oil from Russia, which is not a good situation. Fortune India claims that India is ostensibly buying oil from the Russian Federation and selling it back to the EU for a profit. The New York Post details that analysts believe the ruble’s strength is due to the Kremlin’s capital controls and soaring oil and gas prices worldwide. In addition to India, China and South Korea are buying oil from Russia.
A study published by Bloomberg Economics estimated that Putin could accumulate roughly $321 billion in profits from energy exports alone. Tatiana Orlova, chief economist for emerging markets at Oxford Economics, told, CBS, however, said Russia’s import market is collapsing. In an interview with CBS MoneyWatch, Orlova noted that “apart from soaring export revenues, Russian imports are collapsing because of Western sanctions.” Max Hess, a fellow at the Foreign Policy Research Institute, told CNBC that Russia is still making record profits. Hess said.
That exchange rate seen in the ruble exists because Russia is earning record current account surpluses in foreign exchange. Russia may be selling slightly less to the West now that the West is moving to break (its dependence on Russia), but it is still selling a lot of oil and gas at record high prices. This is what is bringing about the large current account surpluses.
Service providers refuse to renew Russian ATMs, Biden says Americans must pay “as high a gas price as necessary” to stop Putin’s invasion of Ukraine
Meanwhile, the U.S. and various Western companies are doing everything they can to rein in the Russian economy. Just recently, the country’s central bank introduced new 100 ruble bills, but automated teller machines (ATMs) have problems with the new bills (48) (49). Western sanctions have forced ATM companies such as NCR and Diebold Nixdorf to withdraw from Russia. Allegedly, ATM service providers are refusing to renew their ATMs and the machines are rejecting the new bills. According to an unnamed source in the payments industry, Russian ATMs are not a priority. As one source familiar with the matter explained, “Given the geopolitical situation, it is unlikely that development for the Russian market is a priority.”
On June 30, U.S. President Joe Biden was asked at a press conference at the NATO summit how long American drivers would have to pay high gasoline prices at the pump. Biden said it would take “as long as it takes” to stop Putin’s invasion of Ukraine. As long as it takes,” Biden, 52, told reporters, “so that Russia cannot defeat Ukraine and move beyond Ukraine.”(53) The Fortune report explains that American citizens “do not seem to agree” with Biden’s decision. The report cites the latest Associated Press-NORC Center for Public Affairs poll showing a lack of confidence in Biden’s leadership.
70% of Americans, including 43% of Democrats, do not approve of Biden’s management when it comes to handling the U.S. economy. Sixty percent of Americans do not approve of Biden’s leadership, 80% of the U.S. public believes that the U.S. “economic situation is bad,” and 67% of the 80% identify themselves as Democrats. Yet Biden and his administration wholeheartedly believe that Putin is to blame for the world’s soaring gas prices. Biden, 58, said on June 27, 59, “We could have turned a blind eye to Putin’s savage war against Ukraine, and gas prices would never have skyrocketed as they did, but America rose to the occasion.”
What do you think about Biden saying that Americans have to put up with high gas prices because of the high Russian ruble and Putin’s war? Let us know what you think about this subject in the comments section below.
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