The cost of Russian food is increasing, yet nobody is accusing Putin or the conflict of the rise.

• Butter prices have increased by 30% since December last year, while sunflower oil and vegetables are also experiencing ongoing price hikes.
• Despite raising interest rates to 21%, Russia's central bank has not seen a significant decrease in inflation.
• Russia's leadership has denied that the country has traded "butter for guns" and instead blamed "unfriendly" countries for the price rises.

In Yekaterinburg, a small food store experienced a break-in, which attracted global attention.

According to Russian media, CCTV footage from Dairy Place in early November shows a person smashing the door and rushing to empty the cash register, while another person rushes to the fridge and steals 20kg of butter from the chiller.

According to a Google translation, the owner of the store stated on Telegram that the heist demonstrated butter's new value as "gold." However, CNBC was unable to verify the footage independently.

Not only Dairy Place, but also other stores have experienced butter thefts, leading some of them to secure the product in containers. A 200g stick of butter now costs approximately 200 rubles, or about $2, which is a 30% increase in price since December 2023, as per data from the state statistics service Rosstat.

The attention of the public has been drawn to the rampant price rises in Russia due to the theft of a basic product.

For the past three years, the cost of basic foods has been increasing at an alarming rate, with the situation worsening rapidly, particularly this year, according to Stanislav, a resident of Moscow, who shared this information with CNBC.

The cost of food varies depending on the type. While some prices have decreased, such as buckwheat, which was three times lower in 2020 compared to the previous year, most food prices are increasing. The expert estimated that prices have risen by 10% to 40% annually.

In October, Russia's annual inflation rate was 8.5%, exceeding the central bank's target of 4%. This led the bank to increase interest rates to 21% in November, their highest level in over 20 years, and another hike is anticipated in December.

Despite high interest rates, food inflation has not been dampened, with shoppers feeling the impact on dairy products, sunflower oil, and vegetables, particularly potatoes, which have seen a 74% price increase since December last year.

According to Anton Barbashin, a Russian political analyst and editorial director of the journal Riddle, most citizens will inevitably experience price rises due to the fact that "nearly half of all Russians allocate the majority of their income towards food, making them the most affected by inflation."

He pointed out that product inflation is currently the main cause of inflation, resulting in the greatest increase in prices for basic goods, food, and personal items.

The strategy for most Russians has been to reduce their consumption, choose lower-quality goods, and delay long-term purchases. However, this stress is not uniformly distributed. While Moscow is barely feeling the difficulties, the hardest hit are people in small towns and rural areas.

'Butter for guns'

The ongoing war against Ukraine in Russia has intensified inflationary pressures in Europe, leading to rising food costs due to supply and labor shortages, higher wage costs, sanctions, and increased production costs.

Since its invasion of Ukraine in February 2022, Russia has shifted to a war-oriented economy, with a significant increase in state defense spending and a focus on domestic production of military hardware instead of agricultural production. Despite this, the Russian economy has performed better than anticipated, with the International Monetary Fund projecting it to grow by 3.6% this year.

Russia's leadership has evaded criticism for price increases by accusing "unfriendly" countries, specifically Ukraine's allies, of causing the conflict, imposing sanctions, and creating supply shortages.

Russian President Vladimir Putin defended higher defense spending, stating that Russia does not trade "butter for guns."

Putin emphasized at a Valdai Discussion Club plenary session in October that all previously announced plans for development and achievement of strategic objectives, as well as all social commitments made by the state towards the population, are being carried out to the fullest extent, despite some misconceptions about the allocation of resources.

It is risky for ordinary citizens to openly criticize the invasion, as any perceived "discrediting" of the army can be punished by up to five years in prison.

Stanislav, who wished to remain anonymous due to the risks of criticism of the war, stated that he is aware that the price increases are a result of the invasion of Ukraine, but he avoids discussing this topic with others because it is dangerous to speak the truth in Russia.

"Most people accuse foreign countries of being to blame for price rises, but smart individuals comprehend the economic situation," he stated.

The Kremlin has attempted to alleviate public concerns about product shortages by taking action, despite shifting blame for price increases away from itself and the war.

In response to a shortage of eggs and price increases of over 40%, the government lifted import duties on the product. The administration announced plans to purchase eggs from "friendly" countries, and in the first quarter, Russia imported 235 million eggs from Belarus, Azerbaijan, and Turkey, according to Russian media reports.

The government announced in October that it would keep track of butter prices and provide support for a "systemic increase in production" to help the dairy industry meet demand.

Anton Barbashin, a Russian analyst residing outside the country, observed that Russia's propaganda apparatus suggests little evidence of widespread dissatisfaction with the government or president due to persistent inflation.

The Kremlin has consistently managed to distinguish between Putin's policies and the personal struggles of Russians, according to him.

"Although it is not a universal rule, we have not observed these difficulties resulting in accusing the president or the conflict."

Some Russians believe that war is expensive and that propaganda is preventing mass dissatisfaction from rising.

He stated that as the pace of economic transformation in Russia accelerates, it's likely that more individuals will desire an end to the conflict.

"The Kremlin is blaming Western activities and sanctions for economic issues in Russia, providing an easy target for Russians to blame."