Vladimir Putin has been warned by top finance officials and Russia's central bank that the current pace of spending on the war in Ukraine is unsustainable, as Kyiv continues to make gains on the battlefield and strike energy infrastructure deep inside Russia.
Ukrainian Foreign Minister Andrii Sybiha stated on Tuesday that Moscow is 'losing on the battlefield' and 'has no cards except terror', despite a major overnight attack on Ukrainian cities that killed at least 22 people. Meanwhile, defence officials in Moscow have reportedly told Putin they will need billions of extra dollars this year to fund the conflict, according to Bloomberg News.
Finance Minister Anton Siluanov had anticipated that Russia would run at least $28bn (£20.8bn) over budget in war spending this year, according to documents reviewed by the Financial Times. A letter from Siluanov in February urged the cabinet to freeze around $40.8bn in planned non-war-related spending this year, and projected further overspending of $54.8bn in 2027 and 2028.
Siluanov told Russian newspaper Kommersant that the finance ministry is revising the budget to concentrate resources on 'absolute priority spending items' such as social obligations and defence, but warned that 'reserves are not infinite'. Around two-fifths of the budget has been allocated for defence and security this year.
Analysts warn that Russia's economic growth, buoyed by war-related investment, is illusory. Dr Nigel Gould-Davies of the International Institute for Strategic Studies said the war is 'likely to prove economically unsustainable', forcing the Kremlin to choose between escalating demands on the economy or scaling back war aims. Russia's economy slowed to about 1% growth last year, shrank by 0.2% in the first quarter of 2026, and is forecast to grow only 0.4% this year.
Ukrainian President Volodymyr Zelensky said Russian advances have slowed, while Ukraine has intensified strikes on Russian oil infrastructure, knocking out a quarter of refining capacity and risking fuel shortages. The defence ministry and Kremlin have urged against cuts that would damage businesses reliant on lucrative defence contracts.
