Russia’s economy went into sharp decline in mid-2014, at around the same time as economic sanctions were introduced (see Figure 2). The ensuing recession cannot be entirely blamed on sanctions – growth had already been on a downward trajectory since 2010, and then in summer 2014 came the additional shock of a meltdown on global oil markets, for reasons entirely unrelated to the Ukraine crisis. Russia’s economic performance has always correlated closely with crude oil prices, due to reliance on fossil fuels, which generate 70 % of its export earnings. Since early 2016, a modest recovery in oil prices has helped Russia return to positive growth.
Nevertheless, sanctions have had a significant impact, particularly (but not only) in the sectors directly targeted.