Moody's Investors Service downgraded Russia's sovereign debt to junk status on Friday, citing the crisis in Ukraine and the falling price of oil.
Moody's cut Russia's rating to Ba1 from Baa3, with a negative outlook.
"Russia is expected to experience a deep recession in 2015 and a continued contraction in 2016," the ratings agency said in a statement.
Moody's also warned of the—still remote—possibility that Russia could decide on an extreme response to Western pressure over Ukraine.
"The risk is rising, although still very low, that the international response to the military conflict in Ukraine triggers a decision by the Russian authorities that directly or indirectly undermines timely payments on external debt service," it said.