Attempts by the West to use frozen Russian assets to fund Ukraine's defence amount to "stealing" and have accelerated the break-up of the post-war financial order, according to Andrey Kostin, chief executive of Russia's state bank VTB.
Speaking to On the Record, broadcast on Sky News Arabia and The National, he described the use of the assets as "absolutely illegal" and warned that confiscating reserves would drive countries away from the dollar, Euroclear and US Treasuries.
"It's stealing. You take somebody else's funds … in real life, if I do it to you, I'll be in prison, but in an international situation, that's it," Mr Kostin said.
The EU continues to debate how to use about €200 billion ($232.5 billion) in immobilised Russian central bank assets held largely in Euroclear in Belgium. European Commission President Ursula von der Leyen has pressed ahead with using windfall profits from those assets to support Ukraine's defence, a plan Mr Kostin said had already begun.
"They wanted so much, but they couldn't justify this even for any political reason, but it's absolutely illegal … they're stealing the interest already," he added. "They're stealing Russian money because the interest goes to support Ukraine."
He argued that sanctions and asset seizures have shattered the global financial system and brought an end to globalisation. "We are very much against any sanctions which have been imposed on Russia, 30,000 sanctions," he said.
"Really, I think it's broken up the whole international regulation and system, like WTO [the World Trade Organisation] and others. I think globalisation is finished. We are just having different countries, different partnerships, but not any global regulation or global law for international trade and economic relationships."
He said the risk was already evident in reserve behaviour. "That's why there's such a big growth in [the] price of gold, because the Chinese prefer not to invest money now in US Treasuries. They prefer to invest in gold, which is a much safer approach."
Russian benefit
Mr Kostin tied Russia's resilience to higher oil prices fuelled by the disruption of the Strait of Hormuz crisis.
"From one point of view, it's true that the Russian budget is benefitting from this because of the high oil prices. You know, Russian oil companies are getting higher income, which benefits the budget," Mr Kostin said. He stressed that Moscow prefers stability but is making gains from the current price volatility.
Oil prices have surged since Iran shut the strait at the start of the regional war. Brent crude has traded at more than $90 per barrel, down from a $108 peak but still reflecting tight supply. Rabobank has warned that a prolonged closure could keep prices near $96 and sustain inflation. Goldman Sachs estimates diesel margins of $19 to $26 per barrel above pre-March levels, with European diesel margins at $37 per barrel in the fourth quarter of this year.
That volatility has bolstered Russian revenue even as Ukrainian drones hit refineries. Analysis by the New York Times found Russia's exports remained steady through May 2026 and delivered more than $15 billion in additional revenue compared with the same period a year earlier, making Moscow one of the biggest beneficiaries of the conflict alongside the US.
Mr Kostin said Russia's dependence on oil has declined but remains central to the country. "Russian economy depends on oil prices, but less than, let's say, 10 years ago. Our budget depends less on this … our budget is based on the oil price, [which] is something around $50 per barrel rather than $100 like now."
The Finance Ministry has pegged the fiscal break-even price near $50 to $60 per barrel, giving Moscow room even if prices slide. Russia's cost of production is relatively low, Mr Kostin said, and the budget has diversified sufficiently to absorb swings.
Fe rejected suggestions that Russian growth had collapsed. "Russia has dealt very well with all of the different uncertainties," he said. "Many people believed the Russian economy would not do so well – but Russia showed significant growth."
Independent estimates put Russian GDP growth at about 3 per cent 4 per cent in 2024 and 2025, far above recession forecasts at the start of the Ukraine war, supported by state spending, import substitution and reorientation towards China. Mr Kostin said trade with China now exceeds $200 billion a year and is settled in rubles and yuan, not in dollars or euros. That shift, he argued, was a result of western restrictions.
"[Russian President Vladimir] Putin said it himself," he said. It was "not us who decided not to use the dollar. We were cut off from the dollar transactions by the West, by Americans" and by the administration of US President Joe Biden, he added.
Quick peace deal
He linked the sanctions push to a broader move away from dollar dominance, though he did not predict a sudden collapse. "The dollar will continue, of course. And we're not saying that it will happen overnight. But if you look now at what's happening in Russia … the world is switching, not at once, but slowly, they're switching to other currencies."
Mr Kostin said financial centres in Dubai, Hong Kong and Shanghai would grow as capital shifts east and south, while London and New York would lose market share over time.
On the ruble, he said strength hurt exporters more than households. "Russian people should benefit because the import should be less expensive. It's definitely a kind of problem for exporters. But the exporters, they have a little bit of fat, so they can afford it."
VTB expects the ruble to weaken modestly to about 80 per dollar by end of the year, about 5 per cent to 10 per cent softer than current levels, balancing budget needs with import costs.
Mr Kostin was critical of Europe's role. "We, frankly speaking, don't very much understand Europe … they could play a much, much better role," he said. "But they are taking a very one-sided view. And then for the last four years, they didn't even want to talk to Russia."
He said the EU's focus on sanctions over negotiation had pushed Moscow and European businesses further apart, making a return to co-operation difficult. "Russian businessmen were always some kind of bridge between Russia and the West," he said. "But they were deprived of everything, money, you know, property, everything ... and put under very strong sanctions for no good reason."
Despite sanctions, Mr Kostin sees opportunity in China, particularly in partnerships and technology. Chinese companies are moving from selling cars in Russia to building factories in the country, he said, with interest also growing in raw materials and manufacturing. He also highlighted artificial intelligence as an area where Russia remains competitive.
Looking ahead, Mr Kostin said the world was less safe and more fragmented. He admitted both Russian and Ukraine now feel the effects of the war more directly. "The sooner we reach an agreement with Ukrainians will be the better," he added.
