Why hasn't the Russian economy collapsed?

Despite widespread sanctions following Russia's 2022 invasion of Ukraine, economists expected its economy to collapse quickly. Yet it persists, now ranking as the world's 11th- or fourth-largest depending on measurement, even with $320 billion in debt and daily war costs of $500 million to $1 billion. Growth has slowed from 4% in 2024 to under 1% in late last year, but the economy endures. The episode outlines six reasons for this resilience, from global commodity demand to domestic strategies like "schmertonomika" or death economics.

Persistent Commodity Exports

Russia's economy relies heavily on energy, oil, gas, metals, mining products, and fertilizers, which the global economy still demands. Oil remains its top earner. Economist Alina Rybokova of the Peterson Institute notes that the world continues consuming these despite sanctions. Timothy Ash of Chatham House at a London think tank adds that initial sanctions on oil were poorly designed and not fully effective.