Russia didn't fire any shots in Ukraine on Monday, but there were plenty of casualties on Russia's currency, bond and stock markets — even as Western nations rushed to plan their economic defense of the current government in Kiev.
Share prices of Russian companies plunged nearly 11 percent and the Russian ruble tumbled to an all-time low against the U.S. dollar despite Russia's nearly half-trillion-dollar hoard of foreign exchange. The country's natural gas monopoly, Gazprom, which sells to Ukraine and other parts of Europe through pipelines crossing Ukraine, fell about 12 percent, wiping out nearly $13 billion in shareholder value in that company alone.
The Russian central bank spent as much as $12 billion to prop up the ruble, Reuters reported, and raised interest rates in an effort to stem the outflow of capital, although higher interest rates are hardly what the sluggish Russian economy needs.
Investors worldwide fled to safety: U.S. government bonds, gold and oil. Crude oil prices jumped more than 2 percent on world markets. The price of Brent crude, used as a benchmark in most of the world, was up $2.32, to $111.41 a barrel, for April delivery.
"The Russian economy is definitely being hit. We have seen a slide in the ruble's value against the dollar, and this crisis is likely to precipitate capital flight and deter investments," said Julia Nanay, an expert on Russia and the Caspian region with the consulting firm PFC Energy. "This is occurring at a time when Russia needs to attract foreign investment to turn around its weak growth prospects."
