Swedish military intelligence chief Thomas Nilsson told the Financial Times that Russia’s ailing economy has not rebounded despite the oil windfall from the Middle East conflict. He said the Kremlin would need Urals crude prices above $100 a barrel for a full year to plug the budget gap, and much longer to ease broader structural strains.

President Vladimir Putin admitted growth fell short of his targets and warned the surge in oil receipts – potentially $150 mn daily – would be fleeting. Swedish intelligence, corroborating Germany’s BND, believes Moscow is understating its deficit by roughly $30 bn and may be edging toward a banking crisis as sanctions bite.

Nilsson said the crisis has spilled into the defence sector, which now shoulders most growth while the civilian economy stalls. He described the military‑industrial complex as loss‑making, riddled with corruption and dependent on state‑bank financing. Inflation, he warned, is nearer the central bank’s 15% key rate than the officially reported 5.86%.

Sweden’s foreign minister Maria Malmer Stenergard urged EU members to adopt the stalled sanctions package and deepen support for Ukraine, arguing that a tougher stance could exploit Russia’s fiscal fragility. Nilsson concluded the Russian economy faces either a prolonged decline or a sudden shock, both of which will curtail its ability to fund the war.