The tanking Russian economy seems to be doing little to encourage President Vladimir Putin to repair relations with the West . In fact , Putin is slipping deeper into a revisionist Cold War mindset , sending the worst East-West standoff in decades into a potentially more dangerous phase . With Russia 's economy on the verge of collapse , Putin could have used his annual marathon news conference on Thursday to show flexibility over Ukraine and to raise the prospect of relief from Western sanctions . But instead , in powerful rhetoric , he dug in , comparing Russia to a `` bear '' that the United States and its allies are determined to chain down before ripping out `` its teeth and claws . '' His comments solidified a cycle of escalating confrontation and recrimination which will see the year end with U.S.-Russia relations at their lowest point since the fall of the Soviet Union . And there is no sign that things will improve in 2015 . That 's a problem for President Barack Obama , who is holding a year-end press conference on Friday at which global issues like the tension with Russia will likely come up . Obama would rather concentrate on foreign policy crises elsewhere . Though Russia is not the Cold War superpower it once was , it ca n't be ignored : It has 1,600 deployed nuclear warheads and casts a huge geopolitical shadow in Europe . Moscow can also thwart U.S. foreign policy goals vital to Obama 's legacy in Iran , the Middle East and beyond . The White House responded to Putin 's news conference by saying that Putin 's `` revisionist narrative '' was troubling `` but utterly unconvincing . '' `` President Putin has repeatedly attempted to shift blame of the conflict in Ukraine and the internal problems that Russia is experiencing away from his own policies , '' White House spokesman Josh Earnest said . Obama , meanwhile , risked further irking the Russian leader by signing a bill that gives Obama the power to impose new sanctions on Moscow , though he does not plan to do so right away . Despite Putin 's defiance , the White House is convinced that U.S. and European sanctions on Russia , combined with steep drops in the price of oil , are sending the economy into a tailspin that Putin ca n't ignore . Western officials hope that will persuade Putin that the price of his annexation of Crimea and support for separatists in Ukraine is now too great . They reason the economic crunch could turn Russia 's middle classes against Putin despite his current popularity , or prompt oligarchs cut off from Western banks to force his hand . As panic hit Russia 's financial markets this week , the central bank was forced into a hurried intervention to hike interest rates to 17 percent and the government stepped in amid fears of a disastrous run on the banks . This stemmed the bleeding but the ruble has still lost more than 50 % against the dollar this year , leaving the Kremlin in a bind . `` They are between a rock and a hard place , '' said Jason Furman , chairman of President Barack Obama 's Council of Economic Advisors , adding that the Russian economy was `` on the brink of crisis . '' But there is a chance that Putin could respond not by offering concessions , as the West hopes , but by stoking nationalism and shows of Moscow 's military power not seen since the Cold War . Trying to prove it 's still a global power , the Kremlin has sent its warplanes and ships to test NATO defenses . Sweden expressed outrage last week , saying a Russian military plane with its transponder turned off narrowly missed colliding with a Scandanavian airliner . Moscow denied the incident . Russian officials , meanwhile , are accusing the West of plotting regime change in Moscow . Despite rising tensions , some of Obama 's critics , like Republican Sen. John McCain , want him to supply arms to Ukraine , a step the administration fears would not much help forces vastly outnumbered by Russia 's military . `` The argument that I hear from the administration is that we do n't want to provoke Vladimir Putin . That is just Orwellian ... history will judge this administration incredibly harshly , '' McCain told CNN in an interview . `` The only thing that will dissuade Vladimir Putin from what he is doing is when coffins come back to the families in Russia . '' The administration is concerned that imposing more U.S. sanctions unilaterally could fracture the united front with Europe , which has much greater exposure to the Russian economy . Europe has generally been more reluctant to maintain sanctions than Washington , and some experts believe one Russian tactic could be to pull back forces from Ukraine 's border and back peace talks between Kiev and separatists to further soften European resolve . U.S. officials and western Russian experts are also anxious about Putin 's state of mind . People who have met and studied him argue that his strategic choices are distilled from a worldview that insists the West is depriving Russia of its rightful role as a great power . `` We are concerned that the frame just does n't seem to track with events on the ground , '' said a senior administration official . `` That 's one of the reasons why world leaders do continue to reach out and talk to appropriate Russian interlocutors , '' the official said . `` It is a matter of concern . '' In a phone call in March , German Chancellor Angela Merkel told Obama she questioned whether the former KGB agent was in touch with reality . He is `` in another world , '' she said , according to the New York Times . Fiona Hill , a Brookings Institution scholar and author of an acclaimed book on Putin , says the Russian leader 's anti-Western instincts have hardened since he returned to the Kremlin as President in 2012 . `` Putin projects onto us the kind of actions he would take — believing that the CIA Cold War operations are still in place . He understands the world from a different vantage point . He is acting within that on the assumption that we are at war . '' Obama , already beset by foreign policy problems , has no desire for a new Cold War and says Russia 's actions are simply not in its own interests . But the world looks a lot different to Moscow . `` This insistence that Russia is headed in a disastrous direction , that Putin needs to recognize that and reverse course implies an expectation that at some point , Putin will realize that and give in to the West 's pressure over Ukraine '' said Matthew Rojansky of the Wilson Center . `` He has sent implicit and explicit messages to the West that that is not going to happen . '' Along with sanctions , the West hopes another , more personal tactic will break Putin 's resolve -- depriving him of the recognition he craves of the world stage . Putin left the G20 summit in Brisbane last month after he was given the cold shoulder by many world leaders in a nation still mourning 28 Australians among the dead when a Malaysia Airlines plane was shot down over rebel-held Ukraine in July . `` I think they are getting the message , '' the senior official said . `` Putin got it very clearly . His body language was quite clear . ''
Putin 's annual press conference spikes tensions . Russian leader doubles down despite economic crunch . Comment: