Sweden’s government estimates suggest Russia’s official economic data overstates performance. Nighttime luminosity analysis indicates GDP fell about 8% from 2020 to 2024, contrasting with Russia’s claimed 13% expansion. Russia’s inflation figures are also viewed as substantially understated, with 2024 official inflation at 10% while interest rates rose to 21%. Sweden’s military intelligence estimates current inflation is nearer a 15% benchmark borrowing cost than a government reading of 5.2%. Higher oil prices have provided some revenue relief, but meaningful fiscal gains require Urals crude to average above $100 per barrel. Ukrainian drone attacks on oil export terminals limit benefits, and a potential ceasefire that reopens the Strait of Hormuz could sharply reduce global crude prices.
"While Russia has claimed GDP expanded by about 13% between 2020 and 2024, Sweden's analysis of nighttime luminosity suggests the economy actually shrank by 8% during that span."
"Moscow has also lowballed inflation substantially, according to Stenergard, who pointed out that Russia's official inflation figure in 2024 was 10% while the central bank hiked interest rates to 21% that year."
""This would mean Russia is overstating its purchasing power, and that its military spending capacity is weaker than it appears," Stenergard wrote."
"Swedish intelligence believes Russia would need the average price for Urals oil to stay above $100 a barrel for the rest of the year to provide a meaningful benefit to the government's finances, Stenergard said. Last week, the average Urals price hit $94.87 a barrel, the highest since 2023."
#russia-economy #inflation-and-interest-rates #nighttime-luminosity-analysis #oil-prices-and-sanctions #military-spending-capacity
Read at Fortune
Unable to calculate read time
Collection
[
|
...
]