Matryoshkas, traditional Russian nesting dolls, depicting Russian President Vladimir Putin (C), are displayed for sale at a shop near the Red Square in Moscow, Russia, 15 December 2014. The Russian ruble on 15 December dropped to an all-time low against the dollar at 58,35 and the euro at 72,66. (Maxim Shipenkov/EPA)

THE DRAMA playing out in Russia on Tuesday was not pretty. The ruble’s exchange rate has collapsed by some 50 percent against the dollar since mid-June, with an accelerating fall in recent days. A panicked attempt by the central bank at 1 a.m. Tuesday to stop the slide was a failure. Russia now faces a full-blown currency crisis.

For President Vladimir Putin, the crisis is his own doing, a direct outgrowth of a meddlesome adventure into Ukraine, in which he seized Crimea and subverted the Donbas region with pro-Moscow separatists. Mr. Putin’s incursion led to Western sanctions on Russian industry that are blocking badly needed refinancing on global financial markets; huge debts are coming due. The oil giant Rosneft is particularly hard-hit and has implored Mr. Putin to deliver a bailout. Russia has billions of dollars in foreign currency reserves but can’t easily bail out everyone who needs to repay loans. These squeezed companies are in many cases led by Mr. Putin’s cronies, and they have little room to maneuver.

The currency slide is also a consequence of the fall in global oil prices. There are a number of reasons for that decline, but the inescapable fact for Russia is that it remains heavily dependent on oil exports and Mr. Putin did little in recent years to diversify the economy. Lower oil prices will crimp Russia’s budget revenues, and the higher interest rates ordered by the central bank will cut into economic growth. Prosperity and stability in recent years have been essential elements in Mr. Putin’s formula of repressing critics while remaining popular. If the economy declines, so too may his standing. The ever-weakening ruble exchange rate will take a toll on public confidence.

Many Russians have endured currency upheaval before, most recently in 1998. The practical impact of a weaker ruble is to make imports more expensive, impacting those in the middle class and urban elites accustomed to foreign goods and travel. Meanwhile, rising inflation will affect everyone. The West has tried to shape sanctions as much as possible to spare ordinary Russians while targeting the nation’s kleptocrats, but many people will suffer from this economic crisis.

It’s important to keep Mr. Putin and his capricious behavior the target of Western policy — and remember that he is the chief cause of Russia’s troubles. The ruble’s plunge may portend a dangerous moment. Until now, Mr. Putin has steadfastly refused to back down in Ukraine and has escalated violence when his allies were cornered. He may respond to the latest uncertainty by striking out again in Ukraine or elsewhere, and he will most certainly ramp up the anti-American rhetoric. Europeans may also fear chaos in Russia and be eager to soften the sanctions, which come up for renewal in the new year. They should continue to offer him face-saving ways out, as they have from the start. But in the face of his continuing aggression, they must not back down.