Sanctions Having No Effect On Russia But Crushing Everyone Else...,

WSJ  |  Sanctions on Russia, offset by a windfall from high-price energy exports, haven’t inflicted enough economic pain so far to hurt Moscow’s war effort or push President Vladimir Putin to the negotiating table.

That resilience isn’t expected to last, with many economists predicting a deep recession later this year, a rise in poverty and a long-term degradation of the country’s economic potential. For now, the slow pace of sanctions, Russia’s successful efforts to stabilize its economy and its ability to keep oil and gas flowing overseas have cushioned the blow for Moscow. 

That is allowing Russia to continue its war effort in Ukraine for now, said Janis Kluge, an expert in the Russian economy at the German Institute for International and Security Affairs.

“Right now, the economic sanctions are not an incentive for Russia to negotiate,” Mr. Kluge said. “The Kremlin is convinced it can withstand a few years with a bad economy and wait for better days. Russia is emboldened by its own success in fending off the West’s sanctions.”

On Thursday, some of Russia’s top economic officials spoke at the annual St. Petersburg International Economic Forum, which was empty of its normal crowd of global political, economic and business leaders. While staying positive, they acknowledged the long-term problems the economy faces.

“We’ve managed to persevere, we’re a strong people and we just need to believe in ourselves,” Maxim Oreshkin, economic adviser to Mr. Putin, said at the forum.

The economic resilience means that Moscow is able to exert pressure on European countries, which are dependent on its oil and gas supplies. Russia’s energy leverage was on display this week as state-owned Gazprom PJSC curtailed gas shipments to Germany and Italy in what the German economy minister, Robert Habeck, called “a strategy to unsettle and drive up prices.” Russia had previously cut off gas supplies to Poland, Bulgaria and Finland.

Despite Europe’s frantic efforts to wean itself off Russian energy, including through a phased oil embargo by the end of this year, Russia is still earning hundreds of millions of dollars every day from its oil and gas sales because of elevated global prices. Even as Europeans limit purchases, Moscow has been able to reroute some of its oil flows to India and other customers across Asia.