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Russia doesn’t have endless resources, its economy nearing tipping point, expert says

Russia’s finite resources, strained by inflation, labor shortages, dwindling stockpiles, and sanctions, make it difficult to sustain its war effort beyond 2025-2026, as per military analyst Anders Puck Nielsen.
byYuri Zoria
25/09/2024
2 minute read
russia doesn't have endless resources its economy nearing tipping point expert says russia's reactivated t-55 tank damaged abandoned ukraine summer 2023 t-55s were produced 1958 1979 telegram/nmfte
Russia’s reactivated T-55 tank, damaged and abandoned in Ukraine in summer 2023. The T-55s were produced from 1958 to 1979. Photo: Telegram/NMFTE.
Russia doesn’t have endless resources, its economy nearing tipping point, expert says

In his Youtube video, military analyst Anders Puck Nielsen from the Royal Danish Defense College challenges the widespread belief that Russia possesses endless resources to sustain its war effort in Ukraine indefinitely. He argues that Russia’s wartime economy is approaching a critical tipping point that could significantly impact its ability to sustain the war beyond 2025 or early 2026.

Russia’s economy is strained by Western sanctions, labor shortages, and slowing growth, relying on countries like China, Türkiye, and North Korea for economic and military support. Despite short-term resilience, doubts about its ability to sustain the war long-term are growing.

Nielsen supports this assessment by Ukrainian Defense Intelligence chief Kyrylo Budanov that Russia aims to win the war by 2025 or early 2026, as that’s when the Russian war machine will begin encountering serious bottlenecks. According to Nielsen’s assessment, Russia’s economy will start to suffer badly by next summer, making it increasingly difficult to mobilize enough soldiers for the war.

ISW: Russia aims for victory over Ukraine by 2026 amid growing economic challenges

Nielsen highlights several factors contributing to the unsustainability of Russia’s wartime economy:

  1. Inflation: The Russian government’s massive investments in the defense industry are pumping money into society, driving up inflation.
  2. Labor shortages: With unemployment at low levels and the military recruiting about 30,000 new soldiers monthly, Russia faces a significant labor shortage.
  3. Increasing military wages: To attract volunteers, Russia has substantially increased salaries and bonuses for soldiers, which is unsustainable in a long war of attrition, as it fuels inflation across all sectors of the economy.
  4. Sanctions: Despite finding workarounds, sanctions are putting a strain on the Russian economy, forcing the country to spend extra resources on evading the restrictions.
  5. Depleting military stockpiles: According to some estimations, about 80% of the equipment Russia currently uses in Ukraine is old Soviet-era stock that has been refurbished. As these stockpiles deplete, Russia will need to produce more new equipment, which requires significantly more resources.

The analyst predicts that by 2025, Russia will begin to run out of key types of equipment, such as tanks, infantry fighting vehicles, and towed artillery. While this doesn’t mean Russia will completely run out of military hardware, it will face reduced availability and increased production challenges.

Nielsen concludes that the West’s continued support for Ukraine is crucial, as Western economies are not operating on a wartime footing and can sustain their current level of support indefinitely, but political will in the West remains a critical factor in determining the outcome of the Russo-Ukrainian war.

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