Here's the uncomfortable reality about Russia's war finances: they're holding up better than you might hope. Former Russian central bank deputy chairman Sergey Aleksashenko told CNBC on Friday that President Vladimir Putin has enough runway to keep funding the conflict for several more years, economic strain notwithstanding.
When asked directly if Putin could continue financing the war, Aleksashenko didn't sugarcoat it. "Unfortunately, yes," he said during CNBC's "Europe Early Edition." "He is able to finance the war another two, three years, at least. Maybe more."
That assessment comes even as Russia's economic growth trajectory takes a nosedive. The Bank of Russia is projecting a mere 1% GDP growth for 2025, a dramatic comedown from last year's 4.3%. Yet according to Aleksashenko, Russia's fiscal reserves remain formidable enough to sustain military operations that began with the full-scale invasion in early 2022.
The Battle Over Frozen Billions
Russia isn't taking the financial pressure lying down. The country's central bank announced Friday it's launching legal action against Euroclear, the Belgian clearing giant, claiming losses connected to frozen Russian state assets and blocked financial transactions.
The timing is pointed. European Union officials have been floating proposals to redirect proceeds from those immobilized Russian assets toward rebuilding Ukraine. Moscow has made its position crystal clear: any attempt to seize or repurpose those frozen funds will trigger retaliation.
Trump Losing Patience With Peace Process
On the diplomatic front, President Donald Trump is running out of patience. His press secretary Karoline Leavitt told reporters Thursday that Trump is "extremely frustrated with both sides of this war" and "sick of meetings just for the sake of meeting."
The peace framework itself keeps evolving. What started as a 28-point proposal drafted by the US and Russia without Ukrainian participation has been revised. The Financial Times reported Friday that the latest version includes a provision for Ukraine to join the European Union by January 1, 2027.
Trump, who campaigned on ending the war, struck an optimistic tone Thursday when speaking to reporters in the Oval Office. "I thought we were very close with Russia to having a deal. I thought we were very close with Ukraine to having a deal," he said.
But optimism hasn't translated to breakthrough. The Trump administration reportedly aimed for a Christmas deadline for a peace agreement, yet negotiations remain stuck on fundamental issues including territorial questions and security assurances for Ukraine.
The White House confirmed Trump is "aware" of a new proposal submitted by Ukrainian President Volodymyr Zelenskyy, though specifics haven't been made public.