Russian economic problems have led to a flood of cash and triggered a real estate boom in the UAE

Russia's economic problems are creating opportunities for UAE investors to put money to work. Traders from that state have stepped up their activity in the Russian oil and gold markets, the WSJ reported.

At the same time, Russians are moving to the UAE en masse, contributing their wealth to its economy and causing a real estate boom. Russia's difficult economic situation has led to stronger ties between that country and the United Arab Emirates, which is experiencing an infusion of money from the warring country into its markets and economy. This comes against a backdrop of sanctions and trade restrictions that have hit the Russian economy hard, cutting it off from billions in foreign reserves and curbing energy trade.

However, Russia is still selling large quantities of oil, offering significant discounts to "friendly" countries that fall for cheap Russian crude. The discounts have led to UAE traders buying more cheap Russian oil and gold than ever before, bringing huge amounts of wealth to the Middle Eastern country.

The UAE bought a record 60 million barrels of Russian oil last year, according to Kpler data cited by the Wall Street Journal on Monday. At the same time, their purchases of Russian gold rose to $4 billion between February 2022 and March this year, according to ImportGenius data, up from just $61 million in 2021.

Meanwhile, the flight of Russians from their country due to Putin's war in Ukraine has led to a large number of immigrants entering the UAE, including wealthy Russian oligarchs who are flooding the local market with money and investment capital.

Russians became the third-largest group of real estate buyers in Dubai in the last quarter, real estate insurance company Betterhomes told the Journal, a significant increase from the ninth place in 2021.

Meanwhile, Russia's economy is in a state of turbulence. The country's oil and gas revenues are down 50 percent, the Russian Finance Ministry said in February. The Kremlin is also facing a $42 billion budget deficit as it tries to reconcile the rising costs of its "special military operation" in Ukraine.

Experts say the shift of capital from Russia to neighboring countries such as Poland and distant countries such as the UAE will continue in the long term as Putin's credibility in improving the lives of Russian citizens deteriorates. Russia's wealthy oligarchs and ordinary workers are unlikely to return to the country even after the war in Ukraine ends, two Yale University researchers told Insider.