Russia has burned through almost half of the liquid reserves in its national wealth fund as it bleeds money amid the war in Ukraine

• The liquid assets in Russia's national wealth fund fell 44% from January 2022 to December 2023.
• Total holdings in the fund tumbled 12% over the same period amid the war in Ukraine, per Bloomberg.

The stash of liquid assets in Russia's national wealth fund has fallen over 44% since Moscow invaded Ukraine, according to a Bloomberg report of Russian finance ministry data on Wednesday.

The amount of assets that can be easily liquidated under Russia's National Wellbeing Fund fell from 8.9 trillion rubles, or $100.4 billion, to 5 trillion rubles in the two years from January 2022 — the month before the invasion — to December 2023, according to Bloomberg.

Meanwhile, the national wealth fund's total holdings tumbled 12% over the same period.

The massive slump in the national wealth fund's liquid assets came as its holdings in Russian companies and in infrastructure bonds surged by 2 trillion rubles, per Bloomberg calculations. This suggests the state is using its liquid reserves to support the economy.

Russia's finance ministry also used around 3 trillion rubles from the fund to cover its budget deficit in 2023 after it doubled defense spending in the same period.

Russia could be running out of time and money soon as it keeps funding the war in Ukraine, which is soon heading into its third year.

While Russia's economy still appears resilient, it is dealing with a swathe of Western sanctions and weak international oil prices that have fallen about 10% over the past 12 months. Russia's flagship Urals crude oil was exported at an average price of $62.99 a barrel last year — down 17% from a year ago, according to the finance ministry.

Alex Isakov, an economist at Bloomberg Economics, said Russia's national wealth fund's liquid assets will last for another year or two if the country's oil export prices fall below $50 a barrel.

"If oil prices continue to ignore the risks of supply disruption from the Israel-Hamas war, the remaining stock of the NWF's liquid assets will continue to dwindle, making Russia increasingly vulnerable to shocks," said Isakov.