Russia's economy is slowing down due to damage caused to industry as a result of the Ukraine attacks. Bloomberg. GDP rose 0.9%, after a 1.3% increase in the previous three months, according to the median estimate of economists surveyed by Bloomberg. The slowdown is consistent with previous warnings from the central bank that drone attacks are disrupting production capacity in several industries. Refinery shutdowns led to an 18% drop in refining volumes in the third quarter compared to a year, the sharpest decline since 2020, according to Rostat. The decline in fuel production exacerbated the decline in mining output and the wholesale trade moved into negative territory, the data show. The attacks also damaged loading terminals and port infrastructure, negatively affecting exports. "I also want to emphasize the role of the escalation of the war in the Black Sea Basin for economic growth," says Tatiana Orlova of Oxford Economics. "This new crisis is largely responsible for the decline in oil exports through the Black Sea." Orlova estimates that decreases in the export of crude oil and oil products reduced the annual growth in total exports in the third quarter by approximately 3.75 percentage points and reduced the GDP growth rate by approximately 0.7 percentage points. Apart from military production, consumer demand remained the only source of growth, but this too slowed sharply to an annualized rate of 4.2% in the third quarter, down from 7.2% in the previous three months. At the same time, prices have risen, wage growth has slowed, and businesses continue to face rising costs and high interest rates on loans. Production in a number of consumer goods industries also decreased. "More and more industries are "not feeling very well," Sberbank CFO Taras Skvortsov said in October.

Russia's economy is slowing down due to damage caused to industry as a result of the Ukraine attacks. Bloomberg. GDP rose 0.9%, after a 1.3% increase in the previous three months, according to the median estimate of economists surveyed by Bloomberg. The slowdown is consistent with previous warnings from the central bank that drone attacks are disrupting production capacity in several industries. Refinery shutdowns led to an 18% drop in refining volumes in the third quarter compared to a year, the sharpest decline since 2020, according to Rostat. The decline in fuel production exacerbated the decline in mining output and the wholesale trade moved into negative territory, the data show. The attacks also damaged loading terminals and port infrastructure, negatively affecting exports. "I also want to emphasize the role of the escalation of the war in the Black Sea Basin for economic growth," says Tatiana Orlova of Oxford Economics. "This new crisis is largely responsible for the decline in oil exports through the Black Sea." Orlova estimates that decreases in the export of crude oil and oil products reduced the annual growth in total exports in the third quarter by approximately 3.75 percentage points and reduced the GDP growth rate by approximately 0.7 percentage points. Apart from military production, consumer demand remained the only source of growth, but this too slowed sharply to an annualized rate of 4.2% in the third quarter, down from 7.2% in the previous three months. At the same time, prices have risen, wage growth has slowed, and businesses continue to face rising costs and high interest rates on loans. Production in a number of consumer goods industries also decreased. "More and more industries are "not feeling very well," Sberbank CFO Taras Skvortsov said in October.