The Ministry of Finance and the Central Bank of the aggressor country of Russia warned the illegitimate Russian President Vladimir Putin that the country's economy could not withstand further expenses for the war. Bloomberg wrote about this on June 1, citing sources and documents that the agency had reviewed.
High-ranking officials emphasized that further spending on the war in Ukraine threatens the Russian Federation with a dangerous expansion of the budget deficit. Despite the call from the Ministry of Finance to reduce defense spending, the Ministry of Defense refuses to do this and even demands additional funding for the army up to 3 trillion rubles. (approximately $36 billion) on top of what has already been approved.
According to media interlocutors, Putin asked Finance Ministry officials to find opportunities to cut spending in other budget areas before focusing on defense. Officials' views on defense spending have become the most serious sign of internal contradictions in Moscow since the start of a full-scale invasion in 2022, the author of the article states.
During the first four months of 2026, the budget deficit in the Russian Federation reached 5.9 trillion rubles. ($70.8 billion). This is already 50% higher than the planned figure for the whole year. The Russian economy is teetering on the brink of recession after cutting its growth forecast in May. Gross domestic product is expected to grow 0.4% in 2026, down from the previous forecast of 1.3%. Official data shows that the economy contracted in the first quarter for the first time in three years, and National Welfare Fund reserves are about 60% lower than before the start of the full-scale war, media writes.
Russian officials are also pessimistic about maintaining high oil prices. According to officials, they are not able to solve the already accumulated structural problems. Russian Finance Minister Anton Siluanov spoke about problems in the Russian economy at the end of April. In an interview with Russian newspaper Kommersant in May, he said government spending required “a certain amount of restraint” and that “reserves are not endless.”
Reuters, citing sources, wrote that Russian businessmen have already started talking about the need to end the war in Ukraine.
