The Russian economy has recently taken a sharp turn for the worse because of the shift in the global economy following the crisis in Ukraine and its critical impact on the Russian economy in general. As a result, Russia is facing the worst economic condition since 2009, recording a negative 3.7% growth in 2015. The purpose of the following research is to analyze the change in the Russian economy following the outbreak of the Ukrainian crisis in terms of two core causes: Western economic sanctions against Russia and the decline in oil prices.
   The crisis in Ukraine has fundamentally altered the international relations within Eurasia. Not only that, Russia and Ukraine are sitting in their worst disunion since the dissolution of Soviet Union, but the Russian-Western relation also remains to be sharply discordant. Most notably, the economic sanction war is still in progress between the Russian and the Western world, and the following are the key elements of Western sanctions against Russia. First, the European Union and the United States are pursuing target sanctions upon the core areas of the Russian economy, rather than the trade embargos or the block in currency exchange. Secondly, in the case of the European Union, the specific range of economic sanction is comparatively narrower than that of the United States. On the other hand, the Russian government has imposed an import embargo and restrictions on select items upon the Western nations that are participating in the economic sanction. The core characteristic of the Russian economic sanction against the West is that the embargo is only restricted to items imported by Russia; this was a strategical plan aimed to promote the national industry amidst the Western economic sanctions and dropped oil prices through import substitution.
   The Western economic sanctions and the decline in oil prices had negative effects on the Russian economy. The former of the twoincluding the prohibition of the Western sale of military or strategic resources to Russia and the restriction of sale on energy facilities and advanced technology-discouraged foreign trade, led to financial instability and built uncertainty regarding the Russian market. Accordingly, a decreased inflow of the capital for businesses affected by the sanction, increase in currency exchange risk, discouraged business activity, capital outflow caused by lowered Russian market confidence, and decrease in investment have followed. The latter of the two had the greater impact on the shift in Russian economy. Approximately 30% of Russia’s GDP relies on exportation, and raw material export constitutes 90% of the entire exportation activity, wherein two-thirds are oil and natural gas. Due to the nature of the Russian industry structure and export items, the decline in oil prices is reinforcing an economic recession in Russia by inevitably contributing to the decrease in energy resource export, decline in economic growth, worsening of financial expenditure over revenue, devastation in value for Russian Ruble, sharp decline in stocks, reduced investments, diminished productivity in industries, and weakened domestic market. Ultimately, it was the key shifting points in the post-Ukrainian crisis international economy (viz. Western economic sanctions and decline in oil prices) that worked as the core cause of the deterioration of Russia’s economy. It can be asserted that the basic conditions of lower oil prices had the worst effect on Russian economy as a whole, while the Western economic sanctions relatively had limited effects.
   The following are the speculated policy implications proposed under the scope of this study. A prolonged economic sanction war between the West and Russia, along with the dichotomic opposition that has formed, greatly limited the Korean government’s policy options in breadth. In addition, as the North Korean nuclear crisis provoked a sharp tension and opposition within the Korean peninsula, a three-nation joint industrial venture of the Rajin- Khasan project by South Korea, North Korea, and Russia has also entered a complete cessation. However, it is noteworthy that Japan, while being a participant in the sanctions against Russia, is in the process of strengthening its approach towards Russia since the North Korean nuclear crisis. Accordingly, South Korea must readjust its existing policies by comprehensively and objectively evaluating the achievements and future tasks of Russia-related Eurasia Initiative policies. Such evaluative efforts must not only take the unique nature of the current state of affairs and the potential for future collaboration into consideration, but also focus on devising new plans for cooperation with Russia. To this end, it is necessary to look toward different directions in constructing a new actual cooperative system between Korea and Russia, in its continued expansion of both civilian and governmental networks, and in devising and advancing Korea-Russia partner projects. Plans for an additional degree of coexistence and mutual cooperation that can give practical benefits to Russian economy ought to be prioritized over focus on non-repetitive ceremonial events. Specifically, Korea must devise particular plans that can contribute to projects such as modernization of the Russian industry, development of the import substitution industry, industrial innovation, and enhanced productivity. Such is a model for a new industrial collaboration between Korea and Russia, and it is a construction of Global Value Chain. If the environment of sustainable cooperation between the two countries is formed through such endeavors, the Korean-Russian relation may open the door for a new stage of progress: 3.0 Era of Korean- Russian Partnership.