The European Union Office in Kosovo has assessed that Russia’s economy, although affected by rising oil prices due to tensions with Iran, continues to face deep structural problems.
In a published statement, it said that the unexpected oil revenues have been partially offset by the strengthening of the currency, as well as by subsidies granted to oil companies and refineries, which has limited the positive effect on the Russian economy.
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The EU Office emphasizes in the statement that “In the first four months of 2026, Russia’s budget deficit reached 5.9 trillion rubles, significantly higher than the 3.8 trillion rubles planned for the entire year. It is also reported that more than 200,000 businesses have closed since January.”
According to the published figures, interest rates in Russia remain high, while corporate debt has increased significantly since the start of the war in Ukraine. The country is also facing a labor shortage, tax increases, and shrinking domestic demand.
According to the EU, the 20 adopted sanctions packages continue to restrict Russia’s access to technology, finance, logistics, and energy markets, creating long-term costs for its economy.
The statement also stresses that rising oil prices may provide only temporary relief, but do not reverse the structural economic damage, as pressure on Russia remains ongoing.
