Would Costs of Taking Crimea Have Been Prohibitive if Putin Stopped There and Then?

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There is an interesting Bloomberg story that reveals that at a secret February brain-storming session with his aides Putin concluded that costs, which West would impose on Russia for taking Crimea, won't be prohibitive. "The Kremlin insiders gathered in secret last February to answer a crucial question for Vladimir Putin: Could Russia afford the economic blowback from taking over Crimea?", according to Bloomberg.
That Putin consulted individual economic aides on the issue before going into Crimea is no secret. I recall reading in press that Kudrin has acknowledged that he had a dispute with Putin on costs of taking Crimea and that Putin ended up being right in his assessment that these costs would be acceptable (still trying to dig up the exact news story where I read this).
The Bloomberg reporters claim that that Putin was gravely mistaken to conclude at the meeting that that the costs of taking Crimea were acceptable, but I would argue that he was right. . When Putin made his move in Crimea, a number of Western policy-makers assumed that Crimea was gone to Russia for good (recall R. Gates saying that Crimea is gone for good and B. Clinton saying Crimea is a special case). If Putin had stopped after taking Crimea in March, then the more serious sectoral sanctions of Round III would not have been imposed.
But Putin's appetite must have grown or (which is more likely)  he could have concluded that taking of Crimea failed to impress new government in Kiev into accommodating such of Russia's wishes vis-a-vis Ukraine, as Ukraine's non-bloc status, preservation of access of Russian importers and exporters to Ukrainian market on existing terms,  decentralization of Ukraine and preservation of rights of Russian minority. So he decided to support separatism in eastern Ukraine on a more serious scale. That's when he miscalculated the extent and duration of West's economic retaliation for stirring trouble in Donbass, I think. Or maybe he didn't. After all, the Russian economy initially seemed set to weather Round III of sanctions — that West slapped in July — too, but then the decline in price of oil, which began in June, started to be felt, sending the ruble into a dive.
So, perhaps, what Putin failed to anticipate was not costs of taking Crimea or supporting separatism in Donbass, but that the subsequent war of sanctions with West over Ukraine would coincide with was such a steep decline in price of oil (see chart below)
I do believe that taking Crimea was a mistake with long-term geopolitical and economic consequences for Russia, but in terms of immediate economic costs in the form of Western sanctions, it was something that the Russian economy could live with (unless, of course, conspiracy theorists are right that decline in the price of oil was something that Western governments somehow engineered).
currencies and oilUntitled


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