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There is a sense of panic in Russia after a massive rate hike by the country's central bank failed to stop the ruble from crumbling, a former United States ambassador to Russia told CNBC on Tuesday.
However, he doesn't think President Vladimir Putin will necessarily resort to war to distract from Russia's deteriorating economic situation.
"I actually get a sense of panic among economic elites right now, and that makes Putin more cautious," Michael McFaul, a professor at Stanford University, said in an interview with "Power Lunch. "
"Another war in Kazakhstan is not going to stop the falling ruble, it's not going to stop the crash in the stock market and I think he understands that."
Instead, he sees a different type of surprise coming from the Russian president.
"I actually think he may think about changing his government. I think that may be the surprise move you might see in the coming days or weeks."
On Monday night, the Central Bank of Russia unexpectedly raised interest rates in an effort to bolster the ruble, but the currency tumbled against the dollar on Tuesday.
On Tuesday, the President Barack Obama was expected to sign legislation implanting new sanctions on Russia over its activities in Ukraine by the end of the week.
McFaul said he's noticed a feeling of nervousness among his friends and colleagues in the country that surprised him and happened quicker than he expected. He said there is also the beginning of a debate as to whether Putin is choosing wise economic policy.
"I think he's going to have to do something to stop the bleeding. Just the status quo is not going to be good enough," he said.
Carlos Pascual, former ambassador to Ukraine and Mexico and former State Department special energy envoy, believes there is now an opportunity to find a way out of this crisis.
With the ruble in a "free fall" and Russia unable to refinance debt, the only way out of the crisis is for Russia to get access to international capital markets, he said in an interview with "Street Signs. "
"So the challenge today is for both Russia and the west, and in particular Germany, to create a framework that can also bring in Ukraine … to begin to find ways to resolve the Ukraine crisis and bring Russia back into a path of normalcy that will allow it to gain access to international capital."
Don Jensen, senior fellow at the Center for Transatlantic Relations, isn't as optimistic that the Ukraine situation will be resolved.
"A frozen conflict is much more likely. He can't afford to go further," he said.
Jensen believes Putin has lost control of the economic situation but not the domestic political one, yet.
"He's painted himself into a corner where he needs this high — in the 80s, still — public support … to maintain his authority but there's not any near-term signs it's going to go down," he said. "That's a longer-term problem, once some of the economic hardships we're seeing now filter through the society."
—Reuters contributed to this report.