Russia

Russia is experiencing a huge cost increase in petroleum products, in the last couple of months petrol / gasoline has increased by 25% to 35% a liter, due to supply shortages across all regions of Russia, created by Ukraine’s continuing drone attack on Russian refinery facilities, which by all accounts have been seriously damaged. Up to 20% of Russia’s refining capacity has been damaged. Certain Russian regions are experiencing major shortages of petroleum products which will impact future construction activity.

The US attitude towards Russia has changed in the last month, with a definite cooling of relationship towards President Putin & Russia & a more conciliatory approach to Ukraine. It will be interesting to see how this plays out in the coming months. There could be serious complications if any NATO member country shoots down any Russian flights that enter their airspace.

Russia’s ruble has weakened in the last 3 months to 84 Russian Ruble to the US Dollar. Russia’s economy appears to be in a state of flux. Russia is currently experiencing a high construction inflation rate of between 8.5% and 10.5%. This of course will lead to higher construction costs or projects getting cancelled in 2025 / 2026. GDP growth is forecast to be 1.2% for the 4th Q of 2025.

Russia’s construction sector has contracted by 5% in the last 12 months. Unfortunately, the Russia-Ukraine conflicts have impacted the Russian Economy and the Russian Construction Sector, look for this problem to continue until a peaceful solution can be found, hopefully in the next 3 to 6 months.

Russia continues to utilize its’ vast reserves of natural gas, oil, coal, fertilizers & minerals to maintain its political / economic power with countries such as India, China, Brazil, North Korea & Belarus.

The Russian economy prior the commencement of hostilities in Ukraine was slightly smaller in economic terms than Italy. Price hikes, high inflation and rising unemployment appears to be in the cards for the next 6 to 12 months.