Is Putin heading for the abyss in 2016?

Fred Weir speculates that,

"It looks like the Kremlin is getting serious about resolving the ongoing Ukraine crisis....
.....

Experts say that suggests the Kremlin is tiring of the long stalemate over the war-torn Donbass region, and is readying for a concerted push to solve remaining issues and prompt an end to the Western sanctions that even Mr. Putin admits are "severely harming" Russia's economy." (CSM :January 15, 2016) (my emphasis)

The assumption of Fred Weir that sanctions are "severely harming" Russia's economy seems to rather ignore the fact that the price of oil, upon which the whole of the Russian economy is so dependent, continues along the slippery slope towards $20 per barrel.

As reported in The Week yesterday,

"...Oil dips below $30 a barrel for third day in a row – and is likely to go lower" (The Week : Jan 15, 2016)

This is having a severe impact on the Russian economy, as even Putin's glove puppet, Dmitry Medvedev, and Anton Siluanov, Putin's Economic Minster, both have to admit. (cf. also : Moscow Times)

As Olga Tanas, Anna Andrianova, and Ryan Chilcote explain,

"The renewed decline in oil prices is forcing Russia to extend an austerity drive that’s without precedent during President Vladimir Putin’s 16 years in power. The fiscal rigor, though, will go only so far....

.....

“Given that Putin’s military actions serve like an investment in his political standing at home, I do not think that much money will be saved here,” said Wolf-Fabian Hungerland, an economist at Berenberg Bank in Hamburg, Germany. “With every dollar less for a barrel of oil, the chances increase that the holes in the Russian budget can really not be covered anymore.” (Bloomberg Business : January 14, 2016) (my emphasis)

And as Darya Korsunskaya also reports,

"Russia must cut expenditure to cover what could be a more than $45 billion drop in revenues this year if the average oil price is $50 a barrel, Finance Minister Anton Siluanov said on Wednesday." (Reuters (Business Insider) : Jan. 14, 2015) 

Already oil is diving towards a price of $20 per barrel.

Putin is "over an economic barrel", so to speak. 

It is therefore no wonder that Poroshenko is now vowing,

" ... to win back control of Crimea as well as the rebel-held land in the east of the country but says he needs help from the EU and the US.
 ........
"Ukraine's sovereignty must be restored over the occupied territories in the Donetsk and Luhansk regions in 2016" he said, adding that: "The fight for Crimea's return remains a priority." ( Brendan Cole : International Business Times : January 15, 2016) (my emphasis)

If it were not enough that Putin now finds himself "over an economic barrel", his attempt to further hinder the export capabilities of Ukraine has also somewhat backfired.

As his propaganda mouthpiece, RT, crowed yesterday,

"It turns out that losing Russian exports and trade preferences isn’t the only problem Ukraine will face as the trade ban by Moscow comes into force. The transit of Ukrainian goods to Central Asia through Russia has also been halted." (RT : 14 Jan, 2016) (my emphasis)

Unfortunately, however, RT rather conspicuously failed to mention that,

"Ukraine has launched the first cargo train to China that will bypass Russia along a new "Silk Road" meant to counter the Kremlin's most stringent trade embargo on Kiev to date.

 

This is a historic event," Ukrainian Infrastructure Minister Andriy Pyvovarskiy wrote on Facebook.

"Now, Ukraine is not just a potential transit country between the East and West, but one that has finally realised its potential." (AFP (Times of India) : Jan 15, 2016) (my emphasis) (cf also: UT)

What is even more devastating for Putin about this new "Silk Road" is that it also involves Turkey, Putin's latest 'scapegoat' on his controlled Russian media.

"Major logistics companies from China, Kazakhstan, Georgia, Azerbaijan and Turkey signed late November a document on establishing a consortium for the transportation of goods from China to Europe, bypassing the Russian territory." (UT : Dec. 5, 2015) (my emphasis)


Notwithstanding these economic setbacks that now confronts Putin, we should always be mindful of the fact, as Ryan Faith explains,  that,

"A lot has been written about why Putin may have gotten involved in Ukraine's Donbass region following the Great Crimean Heist of 2014.

For starters, there's the slightly messianic vision of Putin as Protector of All Russians. He's been making increasingly louder noises about Moscow's responsibility to safeguard the various ethnic Russians scattered throughout the post-Soviet republics." (Vice News : December 31, 2015) (my emphasis)

Putin expressed this "messianic vision" during his New Year address to the Russian people.
 

To suggest, as does Fred Weir, that Putin is ready to scrap this "messianic vision" of his, even as the Russian economy crumbles around his feet, is to underestimate the tenacity with which he clings to power.

More importantly, however, any failure on his part that diminishes his stature in the eyes of the Russian people, and that may lead to his downfall, will bring to the surface the extensive catalogue of his criminal activities that was set in motion when he set up his criminal cabal in St. Petersburg between 1990 and 1998 with the proceeds of the millions he stole from the people of St. Petersburg. 

(to be continued)