The war against Ukraine is having a significant impact on Russia's economy, raising domestic prices and forcing Moscow to allocate a third of its budget to military spending, according to a document by the US Treasury, the Financial Times reports.

According to Rachel Lingaas, chief sanctions economist at the US Treasury, Russia's economy would have grown by more than 5% if Putin had not started the war.

Lingaas added that the country is lagging behind other energy exporters, including the United States.

According to the FT, in 2023, Moscow spent more than $100 billion on the military, or almost a third of its total spending.

The backbone of the Russian economy - oil and gas revenues - has suffered this year, although there has been a slight recovery in recent months as oil prices have strengthened. In addition, Western sanctions on oil trade in Russia have not had as great an impact as initially predicted, the publication notes.