29 April 2026
The Russian economy ended the first quarter of 2026 in the red, the Ministry of Economic Development reported on Wednesday.
From January to March, GDP contracted by 0.3% year-on-year, despite growth in March (+1.8%), which was insufficient to offset the declines of January (-1.8%) and February (-1.8%). This quarterly decline in GDP was Russia’s first since the beginning of 2023, and as a result, the economy lost a third of the growth it demonstrated last year (1%).
Economic dynamics in Russia have significantly worsened in recent months, according to Janis Kluge, an expert at the German Institute for International Security Studies. For the first time since the beginning of the war, the non-resource industry slid into recession (-0.7% quarter-on-quarter), and some industries experienced a full-blown collapse: clothing production fell by 13.9%, and metallurgy output by 10.1%. Following the strikes on oil refineries, production of petroleum products fell by 0.5%, and for the second year in a row, production of food products was in the red (-0.2%).
“The economy is slowing across all sectors,” write analysts at Vector Capital. Even the military-industrial complex, which consumes trillions from the budget, has slipped into the red: production of “finished metal products,” which statistics classify shells and bombs, fell by 0.8% in the first quarter.
All this is accompanied by a decline in investment imports—primarily machinery, equipment, and technology, notes Finam analyst Yaroslav Kabakov: “We’re no longer talking about a temporary slowdown, but rather a gradual weakening of the economy’s future production potential.”
Kluge points out that the economy has now entered a kind of “twilight zone”: on the one hand, mounting domestic problems, on the other, the positive effects of the war in Iran and soaring oil prices. Russian Urals, which was selling for $40 and above at the beginning of the year, now costs over $100 per barrel. According to the Central Bank of the Russian Federation’s calculations, this will bring the country $58 billion in additional raw material revenue and increase the trade surplus by 1.7 times. However, Sberbank believes
there’s no reason to expect an acceleration in economic growth. It has downgraded its GDP growth forecast to 0.5-1%, raised its inflation forecast (to 5-6%), and also reported that businesses are seeing a decline in turnover for the first time since 2022. “While previously it was possible to say that all the problems were confined to processing, which is clearly suffering from high interest rates and is less dependent on consumer demand, now it seems the economy is slowing on the consumer side as well,” writes Vector Capital.
Rising oil prices, linked to the conflict with Iran, could add 1-3 trillion rubles to the budget in 2026, but are unlikely to improve the economic situation, says Natalia Milchakova, a leading analyst at Freedom Finance Global: “The economy faces significant risks that high oil prices won’t help avoid.”
Yet the US are convinced there is a $12 trillion deal to be made. You might scrape up $12 trillion in BS, there is enough of it coming out of mafia land.
Show Taco some outragous dollar numbers and his little brain goes totally bonkers.