How long Russia can hold out, however, is unclear. Renaissance Capital, a Moscow investment bank, has estimated Russian reserves can support current spending at oil prices of $35 per barrel for six years.
Signs have emerged that Mr. Putin is nervous. Cushioning the price collapse is not the only demand on Russia’s reserves: The country has not announced major bailouts for businesses harmed by coronavirus lockdowns, but they are likely.
This month, Mr. Putin negotiated oil production cuts with other producers after walking away from talks with Saudi Arabia weeks ago.
Low energy prices also have defanged Russia’s oil and gas policies in Europe, which were partly intended to sow political divisions by giving favorable terms to Germany, Italy, Hungary and others. Now Russia has no leverage.