Russia's economy has defied the skeptics. Cracks are getting harder to hide

In this pool photograph distributed by the Russian state agency Sputnik, Russia's President Vladimir Putin meets with Moscow-installed leader of the Russian-controlled parts of the Zaporizhzhia region, at the Kremlin in Moscow on July 20, 2026.Alexander Kazakov | Afp | Getty ImagesAfter four-and-a-half years of full-scale war with Ukraine, Russia has become a two-tier economy."If you are lucky and you're employed by a tank production company, then everything's good. Otherwise, you are probably facing problems," Alex Kolyandr, director for Europe at consulting firm Eurasia Group, told CNBC.Russia's wartime economy has been brought into sharper focus in recent weeks by Ukraine's long-range drone attacks on oil refineries and delivery warehouses. Though it has defied expectations and is even growing slowly, according to recent data, analysts say this masks problems, such as the Kremlin's reliance on military spending, higher taxes and subsidized bank lending.But they question whether this will drive Russia to give up its war. Indeed, Kolyandr warned the worsening economy could incentivize President Vladimir Putin to escalate the conflict."If I were Putin, God forbid, I would probably ...