There were new sanctions targeting Russia’s financial system announced by the United States, the EU, and other allies. This is starting to be a credible deterrent against Russian aggression. Although it is too late for western countries to help prevent the invasion of Ukraine they may be capable of triggering financial mayhem in Russia. This could lead to freezing a total of 630 billion Russian foreign exchange reserves. The majority of Russia’s holdings and securities; band deposits and other instruments are in jurisdictions that will enforce western sanctions.
Although these limits on western technology and industrial exports to Russia will take months to years to have an effect. Russia responded by saying that these sanctions were “illegitimate” and indicated that Russia’s nuclear forces had been put on a heightened level of alertness in response. As well as penalties on oligarchs and their offshore wealth have led to some tycoons calling for an end to this war. Damage from the war, ruble falling by 10%, stock market falling by 35%, and a share of prices of the biggest banks by over 50% are all intensifying the panic in Russia’s financial system. Russia may have to temporarily close its financial markets to prevent a currency collapse.
Now that these sanctions are in place and Russia expressed that its nuclear forces are on a “special regime of duty” the West may now have to alter its nuclear posture in response. We also have to watch for the retaliation of Russia by intensifying their cyberattacks on Western institutions or limiting their gas supply to Europe. The next steps that the Western world may want to take are blocks on internet services or sanctions on Russian oil.
This is an extremely hot topic which goes without saying, but I appreciate the information you found. We will have to wait and see what happens because if Russia is poked too much, the nuclear threat is extremely real. If Putin decided to fire their nuclear missiles then all sorts of chaos would ensue including nuclear retaliation from other countries. It goes without saying, but if the situation does get that bad, nobody is safe. It is a very scary thought, but it is a potential future that could be approaching quickly.
ReplyDeleteIt will be interesting to see how the sanctions from the United States and the European Union will effect Russia's economy overall in the long run. I think it will also be interesting to see how Russia will respond to the sanctions placed on them, as they are the 2nd largest producer of oil and 3rd largest producer of natural gas. I think this could be significant as they supply a significant amount of both to western Europe. It will be interesting to see how world leader respond to Putin's actions.
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