A member of Russia's lower house of parliament, the State Duma, said that the ruble's temporary collapse last week was partially caused by the need to inject funds into the parts of Ukraine that were illegally annexed by President Vladimir Putin last fall.
Anatoly Aksakov, the chairman of the Duma Financial Markets Committee, made the remarks days after the Russian currency fell to its lowest level since March 2022 on June 26, before paring back some of its losses.
The ruble hit a 15-month low against the U.S. dollar after a weekend of instability that saw Wagner Group boss Yevegny Prigozhin's failed uprising in the Russian capital. That attempted march to Moscow wasn't the source of the ruble's collapse, though, according to Aksakov.
Speaking on the sidelines of the Financial Congress of the Bank of Russia on July 6, Aksakov said the price of Russian oil affected the ruble exchange rate, but the cost of spending in the "new territories" also played a role, the Russian state-run news agency Interfax reported.
The lawmaker was referring to the four Russian-annexed regions of Ukraine last year: the Donetsk and Luhansk regions, Kherson and Zaporizhzhia. Russia is not fully in control of any of the four regions, and foreign governments, including the United States, said the move was illegitimate.
The Russian currency has slumped amid sanctions imposed by the European Union, the United States and other Western allies in response to Putin's invasion of Ukraine in February 2022.
Russia was kicked out of the SWIFT global banking system, while Western nations froze Russia's access to some of its foreign reserves. Europe also froze purchases of Russian oil and gas. And in December 2022, the G7 agreed on a price cap on Russian crude and refined petroleum products, putting strains on the ruble.
The Wilson Center, a United States-based think tank, said Russia's road to recovery has been made significantly more difficult by its anti-Western and isolationist rhetoric.
Kremlin spokesman Dmitry Peskov told reporters on July 6 that the ruble was undergoing fluctuations.
"There is no question of economic stability here," Peskov said. "We really see fluctuations—the exchange rate is growing, the ruble is falling, but let's remember that we have seen this several times, and there were rebounds."
Newsweek reached out to Russia's Foreign Ministry via email for comment.
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Isabel van Brugen is a Newsweek Reporter based in Kuala Lumpur. Her focus is reporting on the Russia-Ukraine war. Isabel ... Read more
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