Russia is the world’s top energy exporter, extracting and selling billions of barrels of crude oil and natural gas; a huge amount of the national budget (and therefore the method of payment for social services, the military, and much more) is paid for on taxes on these fossil fuels.
So there are few countries that were hit harder by the collapse of energy prices than Russia, which as little as a year ago based its budget forecasts on oil remaining comfortably over $100 a barrel. It isn’t just the government hurting either; a huge chunk of Russia’s private economy relies on the energy sector in one way or another. Entire cities and regions were built specifically to capitalize on energy reserves, and with the fall of prices, the economy as a whole has been contracting at over 5% a year.
Economists all over the world are showing the Russian government hurting seriously, with some creditors worrying how it will continue to pay its bills. Many experts believe it may need to remove some currency controls (which would lead to widespread inflation as the Ruble quickly devalues against other currencies), or even capital controls (as Greece recently resorted to, which controls how much capital people and companies can take out of the markets over a certain period of time).
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