Sanctioning Russia: Reminiscent of the Cold War
Although the conflict is now between Ukraine and Russia, Russia’s invasion has prompted some of the most dramatic action from the U.S against Russia since the Cold War. In an effort to dissuade war, the U.S and West at large have made efforts to sanction Russia.
The most notable sanction comes from the complete ban of oil importation by the U.S, while countries like the U.K pledge to do the same by the end of the year, the U.S took the most dramatic and automatic action. On top of this, Russia has had reserves frozen, been removed from international banking, and lost some of their imports.
Even companies such as Disney and Google have suspended operations within Russia in a show of support for Ukraine. This has led to a potential 15% contraction in the Russian economy by the end of 2022. On top of this currency fluctuation and skyrocketing interest rates in Russia are other symptoms of the sanctions.
This is a strong disincentive for Russia but doesn’t leave other countries unscathed. The U.S is seeing all time high gas prices, a plummeting stock market, and general economic volatility. Russia is a major economic player in today’s market and to exclude them hurts not only Russia but the world at large.
Though that is a high price to pay, it is the price many countries in the West are willing to pay. When the alternative is war or an unregulated Russia, an economic downturn is being accepted as the lesser of many evils. How this will continue and advance as the year progresses is yet to be seen.
Source: USGoldBureau.com
