The logo of the Russian State Atomic Energy Corporation Rosatom, in Sochi, Russia, circa December 2021. Russia’s flagship nuclear exporter faces mounting financial, sanctions, and competitive pressures that the West must take advantage of. (Shutterstock/fifg)

Reagan Broke the Soviets. Is the Kremlin’s Atomic Empire Next?

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The Ukraine war is starving Rosatom of capital, Washington is coming for its fuel business, and America and its allies can take the market it leaves behind.

For two decades, Russia’s atomic empire looked untouchable. Rosatom entered this year with the world’s largest foreign order book, roughly $200 billion, including 31 large reactors in 10 countries, along with substantial fuel and services business; plus, in Uzbekistan, the first export deal anywhere for land-based small modular reactors (SMRs). Its pitch was one no Western vendor had been able to match, until now. This was never just about commercial nuclear cooperation. 

Rosatom is no ordinary vendor; it is a state corporation answering directly to the Kremlin, a labyrinth of hundreds of interlocking subsidiaries that spans uranium mining, enrichment, fuel fabrication, reactor construction, the Arctic icebreaker fleet, and the production complex behind Russia’s nuclear weapons themselves. Rosatom’s package, critics and security analysts argue, was designed to make partner countries structurally dependent on Russian fuel, financing, and technical support, all of it a long‑term energy lever Moscow could pull whenever it needed geopolitical pressure.

As one recent analysis of the corporation’s role as an instrument of Russian statecraft put it, Rosatom offers “a reactor, decades of operational support, and sovereign financing” that, in several major projects, has covered most or even all of project costs, repayable over 30 years and backed by the Russian state itself. The headline today is not that Rosatom is failing, because it’s not; rather the headline is that the state behind that guarantee has entered an era of capital rationing, and the strain is now visible in every corner of its nuclear enterprise.

The Ukraine War Is Consuming the Kremlin’s Balance Sheet

Start with the state and the wartime spending boom that produced roughly 4 percent growth in 2023 and 2024, which is now over. Moscow’s own government slashed its 2026 growth forecast to 0.4 percent, and the economy actually contracted in the first quarter, the first quarterly decline in three years, with weakness across virtually every civilian sector. Independent analysts describe a slide from managed cooling into outright stagnation, with higher taxes arriving to cover bills. 

The money that once floated everything is drying up at the source. Oil and gas revenues fell 45 percent year over year in the first quarter of 2026, squeezed by lower prices, sanctions on Rosneft and Lukoil, and Ukrainian drone strikes that repeatedly knocked out export terminals and refining capacity. By midyear the federal deficit had reached 2.5 percent of GDP, already blowing past the full-year target. A government in that position funds the war first, political stability second, and everything else if or when it can. This is no longer inference; it’s policy. 

The Russian Finance Ministry has told the agencies that distribute budget funds to prepare cuts of roughly 10 percent across non-sensitive categories, explicitly shielding defense and social payments while new construction projects go first to the chopping block. Behind closed doors, it is worse still, with Bloomberg reporting that Russia’s top financial officials have privately told President Vladimir Putin that current defense spending is unsustainable. Capital rationing is now official policy in Moscow, written down and circulated. The market signals corroborate the squeeze. Even after a succession of rate cuts, the Bank of Russia’s key rate still sits at 14.25 percent, a punishing hurdle for long-duration project finance, and the liquid portion of the National Wealth Fund has dwindled to roughly $46 billion, just 1.5 percent of GDP.

Everything else includes the crown jewel. Rosatom’s export projects ultimately depend on the same sovereign balance sheet, including the sovereign wealth reserves now being drained to plug the budget, which means the reactor in Bangladesh and the artillery in the Donbas are increasingly competing for the same state financial resources. And the competition is lopsided. A ruble spent on shells buys military capability this month. A ruble committed to a reactor is locked away through a seven-to-twelve-year build, in projects like Akkuyu in Turkey, contracted at about $20 billion for four units, with full payback decades out, which is precisely the kind of long-duration bet that wartime treasuries cut first. 

The rivalry extends to people as well as money. The specialized workers Rosatom relies on, such as technicians, certified welders, metallurgists, specialty forgers, and nuclear and quality engineers, are the same people defense plants, shipyards, and missile lines are competing for in a labor market strained by mobilization, emigration, and demographic decline. Even where the financing appears, the execution capacity may not be. The result is a corporation coping in five distinct and telling ways.

Five Warning Signs Inside Rosatom

First, it is slashing its own investment program nearly in half. The program ran RUB 1.66 trillion (about $20 billion) in 2025 and is just over RUB 900 billion for 2026, or roughly $11.5 billion, as TASS recently reported. CEO Alexei Likhachev has said the company immediately abandoned or postponed a number of projects, using profit per ruble invested through 2030 as the main filter, all the while “of course, without compromising the fulfillment of state objectives.” That is not a state of strategic expansion; rather, it’s financial triage.

Second, the triage extends to the flagship. At Akkuyu in Turkey, the first nuclear plant in that country’s history, a roughly $7 billion financing shortfall in 2025 slowed work on the other three units while Rosatom directed resources to getting the first reactor online. Some Turkish media reports estimated the site workforce had fallen that year from approximately 35,000 to 12,000, with Russian workers reportedly leaving........

© The National Interest