Latvian intel: Russia conceals billions in losses as Vladimir Putin is told of 'success'
Photo: Vladimir Putin (Getty Images)
Russia claims it is successfully coping with sanctions, but in reality, they are causing significant damage. Moreover, the Russian President is being provided with "embellished" information about the actual state of the economy, according to a report from the Latvian intelligence service, the Satversmes aizsardzības birojs (SAB).
It is noted that Western sanctions have already caused significant losses to the economy of the aggressor state and will continue to limit its capabilities.
Collapse of exports and loss of markets
According to Latvian intelligence, over the past four years, Russia has failed to find alternative export markets to replace Western ones. Comparing data from 2021 and 2025, analysts recorded a significant decline in exports across key sectors:
- Iron ore — down 40%;
- Timber and pulp — down 50%;
- Chemical products — down 35%;
- Ferrous metals — down 20%.
According to Russia’s own realistic forecasts, these sectors will not be able to compensate for the losses for at least the next five years.
Forecasts up to 2030
It is expected that, due to a combination of risks, Russia’s foreign trade will shrink by $175.5 billion by 2030, of which $136 billion is a direct result of Western restrictions. The SAB emphasizes that even these figures are optimistic, and the real impact of sanctions could be several times greater.
Although the current rise in energy prices due to the crisis in the Strait of Hormuz and the war in Iran provides Russia with temporary financial relief, it does not resolve the structural problems caused by the war and sanctions.
Putin’s information isolation
Intelligence points to a significant gap between reality and official propaganda. At the highest levels of the Russian government, there is an understanding of the severity of the situation, but publicly, they continue to promote narratives about "successful market substitution."
Moreover, there is a high probability that the Russian President Vladimir Putin is being provided with distorted information, emphasizing only "successes."
This reinforces his belief that economic losses are secondary compared to the goal of establishing control over Ukrainian territories, making him unwilling to change his aggressive course.
The report notes that sanctions remain one of the most effective tools for limiting Russia’s financial resources.
They deprive the aggressor state of the ability to fully finance the war in Ukraine and hinder long-term rearmament of its army for potential conflicts with NATO.
The Kremlin’s oil and gas revenues in the first quarter of 2026 fell by almost half compared to the same period last year. Ukrainian attacks on Russian oil infrastructure are additionally undermining export capacity.
In addition, sanctions are forcing Russia to sell off its gold reserves (the lowest level since March 2022), exchanging gold for yuan. Gold makes up nearly 47% of reserves, meaning it remains the main liquid asset.
