Putin's Oil Empire Is Breaking Inside Russia

Added: 2026-05-07

[00:00:00]Today we are seeing that the Russian war machine is indeed massive. However, it's built on a glaring vulnerability that it requires finances from the Russian national budget because today Ukraine is destroying the Russian national budget. It is hitting the refineries. It is attacking the ports.

[00:00:19]It is going after the factories that allow Russia to be an operable state.

[00:00:24]Without these facilities, Russia, it has nothing. That's why Ukraine is being so effective today because it is carrying out a type of war for which Russia is wholly unprepared and these attacks are causing shock waves across the country.

[00:00:38]We see that the dictator himself it's also affecting him because his reputation was to be the man who guaranteed stability. The one who protected the Russian speakers but now the people inside of Russia do not believe that he could protect them. And the reason is simple. It's because he cannot. Vladimir Putin though there's more to that. He has disappeared yet again. So why is it whenever there's a problem, we see that the Russian dictator, the tough guy, seems to get up and run away. That is Vladimir Putin.

[00:01:08]But let's take a look at it. Let's take a look at what's going on right now inside of Russia and what's really happening inside of Ukraine. You'll see why today it's very clear that David is beating Goliath.

[00:01:20]My name is Dr. Jason Smart. I'm a KEF post special correspondent and national security adviser. Overall, the situation has been pretty amazing to watch. You remember when this war started, it did not look very good for the first couple of days. But over time, today Ukraine is creating technologies like these drones that fly so deep inside of Russia have such an amazing impact at risk. Not one Ukrainian soldiers life to do these missions. That is absolutely incredible.

[00:01:46]When the war first started, people thought it was novel to have drones.

[00:01:49]Today, how much have we talked about them? But all the same, when we look at the war today, we see something else that's very important. The strategy that Ukraine is carrying out is one that the Russians clearly do not have a plan for and they have no plan of making a plan for. That's why the attacks like the ones last night in Orsk and Perm, which is pretty far away from Ukraine. In fact, Orsk is about 1,400 km. It's 870 mi. In the case of Perm, it's located about 1,500 km, which is about 930 mi away from Ukraine. In the case of both those attacks, the Russians were not prepared because once you leave Moscow, you realize they don't have a lot of air defense. They have a lot of air defense in Moscow. They have a lot of air defense around Vladimir Putin's personal estate. But for the people of Perm, the people of Tapsi, there's not enough for them. That's why Ukraine carried out three different attacks on Twopsy near Nova Rosisk, one of the most important facilities for the Russian oil industry in the entire country. You would imagine that would be a facility that they'd have air defense, but they didn't. And the most incredible part is that the Ukraine carried out attacks there for three nights in a row. So after the first night, they would have gotten the idea that the Ukraine's attacked. They didn't destroy everything, but maybe they'll come back for more, which they did. But the second night they didn't learn and so they had to happen a third night before Ukraine finally finished it off. That's what's happening now in this war. Russia's ability to learn from its mistakes, to learn on the fly is non-existent. They are not improving at all on the battlefield. Incredibly enough though, the Russian state, it's hanging on by a thread. The budget of Russia is a total disaster. As you know, they've got a massive deficit already, only a few months into the year, and already they've blown through all of the deficit they thought they'd have. But as it continues to grow, it's growing as the banks in Russia have less money. The government's taking out a lot of money from those banks. And given the fact they're not paying back those banks, there liquidity problems for the banks as well. I've said before, I think one of the most important things about the Putin regime, it's poorly understood in the West, is specifically what it functions for. What is its objective that exists for? The fact is that it's not for the people of Russia. It's not there for anything else than the enrichment of some of the elite. It's something we've talked about a few times before. If you look how incredibly wealthy those around Putin have become, specifically since the war in Ukraine began, it all starts to make a lot more sense, which is also sort of incredible that the entire war in Ukraine might have been done out of self-interest of people who are making money from the factory zone today. Because today, the government is taking over businesses of those who left when the invasion began.

[00:04:32]When it takes over those businesses, those in the clan of Putin seem to always end up with them. When you look at the western companies that are left, the vast majority of them have had their assets taken and given to cronies of Putin. It's always a business motive.

[00:04:47]So, if it's really just about money, it's a lot less about ideology. It's a lot less about the Russian world, then we can try to predict what's going to come next, what they will do in the situation. Well, the incredible part is we know that just the people around Putin, they have sufficient money to cover the debts the government has. They could easily make sure with their billions of dollars they've made from this war, that somehow the government would continue operating. It wouldn't have to worry about closing down the hospitals, part of the massive deficit it has in its national budget. That's clearly not something they're interested in. They're interested purely in leveling out the country, taking as much as they can before it all goes out of business. Vladimir Putin is a person himself. I'm pretty sure does not have any strong emotional ties to Russia. I know he's generally thought of as being a nationalist. There's a reason the nationalist hate him. In fact, he's arrested a lot of nationalists and put him in jail. So, though he does talk about nationalism, he comes across as a nationalist if you just read his statements. I think it's really just a clan that's easy to align with. It's very easy to predict what they want to hear. And we've seen patriotism. It's been used in a lot of countries before as a justification for a lot of actions, but not necessarily what someone really heartfully heartfelt believes.

[00:06:05]What else interesting though specifically in this case though is this all coming at one other critical moment.

[00:06:12]As you know, Russia has gotten a pass for the United States to start implementing the sanctions. The sanctions the United States was going to implement against Russia against his oil are pretty serious stuff. That is something that could be a gamecher and really help Ukraine out more than anything else today that would really help Ukraine out be the US to implement its sanctions and to enforce them.

[00:06:33]Historically, it's always been a problem in the United States actually going back years and years is we've always had a problem that we have the right laws on the books, but who's going to enforce them? Who's going to check if they're violating sanctions? Now, there is a hope, I would say, with those of us in the pro- Ukraine world that now given the fact that Iran has worked with Russia to use drones to attack Americans to kill American sailors, uh, that now there'll be more attention on this, that we will get serious about enforcing the sanctions. However, I have my serious concerns that perhaps we won't.

[00:07:07]I sort of feel aligned with what President Zilinski said yesterday. In fact, now I'm very apolitical, as you know, about US politics. From a public policy standpoint, I have no opinion.

[00:07:17]Uh, but as far as it goes for Ukraine, I think he was correct. He said that he was asked in an interview, "What do you think about the fact that Vice President Vance is so proud of the fact that they are not giving weapons to Ukraine?"

[00:07:33]President Zanski correctly answered, "That only helps Russia." I think it's pretty much the same with this. We have to understand that everything that we do whether or not it is in foreign policy that is it whether or not it is meant to help Ukraine or to hurt Ukraine it doesn't really matter what it was meant to do. The facts either will help Ukraine or it'll hurt Ukraine. It can be one or the other. But by continuously deciding to not put sanctions on Russia that's undoubtly helping Russia. Russia today is in a very desperate situation economically. It cannot continue like it was. is in a situation that is beyond challenging. And that's why we have such a great opportunity right now to really put on the pressure, to really make sure that we take them to their knees. But that requires us to fulfill our sanctions and make sure that we go after those who continue to assist the terrorist regime in Moscow.

[00:08:26]Now if we do implement these sanctions and they come through as they are promised to that could be truly a game changanger for Russia because they at that point would reach increasing levels of instability in their own population at home. They're very worried about the fact that these uh banking sector is going to be perhaps seizing people's money. They're concerned about the fact that you cannot take out more of your money already. They're also concerned by the fact that constantly in the press in Russia, they're talking about the need to be careful because there are people trying to defraud you of your money that work with the banks. So people are trying to paranoid about banks to begin with. And that's where it leads to a very interesting thing. As you're probably aware, there's an economist called John Maynard Kaines. He wrote a book called Animal Spirits about how people react to things. And one of the things that he identifies was that it's irrational a lot of things that occur.

[00:09:15]For instance, people respond to fear.

[00:09:18]People respond to gut instinct. That's not necessarily based on science. It's just they have a feeling the markets are going to do good or the market's going to do bad and they react as a result of it. But it doesn't necessarily mean that there's actually sort of science or data behind it. If you live in Russia today, how would you assume the markets are going to do? If you work at an insurance company in Russia and you're trying to insure Tinker Fleet, how would you assume things are? When you look at the factors that you see with your own eyes, the Americans are put on sanctions. The Americans quite obviously had the physical capacity to stop any ship anywhere in the world. So that's one side. Or look at the facility for oil in Tapsi. That one down there by Novosis.

[00:09:59]That facility was burning for a number of days. What's incredible is that all the people there, they know about it.

[00:10:05]You could smell it from a long distance.

[00:10:07]And because of that, what is the perception of a person there? Well, the perception probably be it's time to start worrying. This looks like it's a serious problem. This is not just on television. This is happening here and now.

[00:10:20]But that leads to the next point is that why you should be afraid if you are average Russian citizen is that you see all the signs that in your nation's collective memory are signs that soon your currencies can be devalued or soon you're going to lose your savings in the bank. If that's what your history teaches you, you're most likely to respond to that, not the official statements that come from the government. The government today is trying to find ways to control the population. And it's not been coming very easy. Of course, they've been doing things like turning off the internet.

[00:10:48]They put out propaganda. But the average citizen, he knows what it looks like when there's bankr run. He knows what it's like when the bank doesn't give you money back. The Russian government today if it was forced in such a situation where it had to bail out banks, it does not have the capacity. It doesn't have the capacity right now to pay its own debts, let alone go bail out banks.

[00:11:10]Russia's situation though is going to become ever more complicated in the upcoming weeks and months. The loss of revenue that they're facing to oil and gas already is huge for Russia. But the further loss that would come as a result of the fact the US is implementing sanctions would be even bigger deal. So for Russia today there's not a lot to look forward to. There's a fact that the ongoing cost that they're paying today to violate sanctions to get parts to get things at microchips is incredibly expensive. It's been estimated that they spend billions of dollars a year just to get the parts that are no longer available due to the fact that they're under western sanctions.

[00:11:48]Russia today though is sort of in a very difficult position. On one side you have the average citizen. He sees all this.

[00:11:54]He understands all this at least passively if he's not thinking about it.

[00:11:57]But he understands these are not good signs. He understands that these are very bad signs. But for those around Vladimir Putin it does sort of explain a lot of the movements we've seen recently. Why it is today that different groups for instance those coming from the FSB that they are doing so much so quickly to consolidate power consolidate control. It could very well be because they realize that soon there's going to be some changes. And in fact, there's more signs that support that. But you can help make change, too. Check out our first pin comment below with the question day. Right below it, you'll see we're doing our fundraiser to help the Ukrainian soldiers to get what they need to fight and come home alive. All donations are being matched right now by a generous donor. Thank you so much.

[00:12:39]Overall, for Vladimir Putin, it's a very difficult situation his country is in.

[00:12:42]He himself though seems to be totally checked out of it which is a very good thing for all of us and that's why today the government continues to make bad decisions. It continues to not correct obvious mistakes. It continues to tell itself lies and believe them. There's a certain degree of danger that comes just from that. Not only do you lie but you believe the things you lie about. That is the Putin regime summed up. So there is something to look forward to and it's something very soon.

[00:13:10]Check out this video to see more. As always, thank you for supporting Ukraine.