The decision by the Organization of Petroleum Exporting Countries (OPEC) to keep production at its current limits in the face of slumping oil prices means trouble for the Russian economy, analysts believe.
Despite hopes from members Venezuela, Iran and Iraq that the 12-counrty oil cartel would cut production from its current 30 million barrels a day, the committee, led by Saudi Arabia, sent out the message that it could cope with lower oil prices.
Brent crude was hovering near a four-year low early Friday of $72.43 a barrel, while U.S. crude futures tumbled Thursday nearly $6 to $67.75, the lowest since May 2010 after OPEC's decision. Crude prices have fallen around 30 percent since June on the back of an abundant supply and lack of demand. As such, there was hope that OPEC might support prices by cutting production but these were dashed on Thursday.
Along with the currencies of other oil producing nations, such as Norway and Canada, the Russian ruble fell further after the OPEC decision was announced. On Friday, it was trading at 49.14 against the greenback, having dipped from 47.39 against the greenback ahead of the OPEC decision on Wednesday. Russian stocks also dropped on the news but the country's MICEX index had recovered to trade slightly higher Friday morning at 1,533.
The Russian stock market has seen wild swings this year and the country's currency has fallen 45 percent against the dollar year-to-date due to global concerns over Russia's alleged incursions into Ukraine and the fall in the oil price. Russia holds among the world's largest resources of gas, oil and coal, according to the International Energy Agency – and relies heavily on its energy exports.
With the oil price falling further on the OPEC decision, Russia's economy bear the brunt of the decision, analysts told CNBC.
"(The OPEC decision is) very bad news for Russia and the ruble - just makes a difficult decision that much more difficult," Timothy Ash , head of emerging market research at Standard Bank, told CNBC in an email Friday.
Meanwhile Naeem Aslam, chief market analyst at Ava Trade said in an email to CNBC Friday that lower oil prices will drive the income of oil-producing firms lower "which could increase the pressure on Mr Putin and on his economy".
Russia between a rock and a hard place
Russia might be able to cut production, but that will come at a price to Russia's economy. On Thursday, Russia's finance ministry said the country's budget policy should be adapted to low oil prices which could last for a long time, RIA news agency said, cited by Reuters.
A weaker ruble in Russia on the back of sanctions imposed on the country after its incursions into Ukraine has not helped rampant inflation miring the domestic economy. The economy ministry believes inflation will hit 9 percent before the year is out.
The country's central bank has increased interest rates in a bid to curtail spending and bring the inflation rate down. But growth is falling as economic outlook worsens. Russian gross domestic product expanded just 0.7 percent year-on-year in the third quarter.
The Russian Central Bank has lowered its 2014 growth forecast to 0.3 percent and now forecasts no growth in 2015, down from a forecast of between 0.9 and 1.1 percent growth forecast in September.
Read MoreWhy is Putin buying gold?
The falling oil price might not be all bad, however, according to Ava Trade's Aslam. Falling oil prices mean lower inflation -- something Russia could do with -- as the cost of producing goods becomes cheaper. As such, Russian producers could be given a boost but for oil companies it's a different matter.
"Lower inflation is good for producing goods especially now (in the short term) however, as far as it goes for the drilling companies, it is a disaster," Aslam said.
The Kremlin has major stakes in some of Russia's biggest oil companies, among whom are Rosneft, Lukoil, Yukos, Gazprom, TNK-BP and Surgutneftegaz, which were trading mixed on Friday but the OPEC decision could spell "disaster" for them – and for the government.
Pressure on Putin
With attempts to buoy Russia's economy set to get harder, Russian President Vladimir Putin could face growing disillusionment among the Russian populace, analysts also believed.
John Kilduff, the founding partner of Again Capital, told CNBC in an email Thursday that the decision could put pressure on Putin's regime. "The (decision) could spell political trouble for Russia, including a threat to Putin," Kilduff said. "(CNBC presenter) Steve Liesman joked to me that they can (afford) $60 oil, but the regime won't be able to afford to stay in power," Kilduff noted.
If oil prices remain near or below current levels then the Russian government may well have to make some difficult decisions to help balance the books and try to keep its economy on an even keel, Michael Hewson, chief markets analyst at CMC Markets, told CNBC Friday.
"President Putin may be popular now but if the rise in inflation pressures starts to adversely affect the Russian public for a lengthy period of time it could well cause the Russian government some problems further down the line."
- By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt.