He bet almost his whole economy on oil and gas that only can be exploited long-term at the risk of disruptive climate change; he underestimated the degree to which technological innovation has enabled America to produce more oil, gas, renewable energy and greater efficiency, all at the same time, helping to undermine crude prices; he talked himself into believing that Ukrainians toppled their corrupt leaders only because the C.I.A. told them to — not because of the enduring human quest to realize a better future for their kids; and he underestimated how integrated and interdependent Russia is with the global markets and how deeply sanctions, over time, would bite him.

Let us not mince words: Vladimir Putin is a delusional thug. He created, fell in love with and is now being disabused of a fantasy notion of his and Russia’s power. Might he lash out militarily now to distract his people with more shiny objects? Yes, he might, but then he’d only be violating another rule of geopolitics: “The First Rule of Holes” — when you’re in one, stop digging.

I say that with no satisfaction. In fact, I say it with deep regret. I opposed NATO expansion and our unilateral ripping up of the Anti-Ballistic Missile Treaty, when Russia was weak. I wanted — and still want — to see America partner with Russia to help stem global disorder, because in many places in the world we can’t be effective without a Russian partner. Alas, we expanded NATO — and unintentionally helped to foster the political conditions in Russia for Putin’s xenophobic, grievance-based politics to flourish.

But Putin also went nuts. Oil at $110 a barrel went to his head. He thought all of this was about him, his decisions, the economy he and his cronies built and on some Russian geopolitical entitlement based on history. In reality, he had bet everything on drilling oil and gas, not on building his people and their talents. He rode the price up and now it is riding him down.

Along the way, Putin lied to the world and deluded himself. His big lie is that the popular toppling of the corrupt government of Viktor Yanukovych in Kiev was just a Western plot to bring Ukraine into NATO. In Putin’s spook-defined world, no one has agency — except the Central Intelligence Agency (or K.G.B.). It is inconceivable to him that a critical mass of Ukrainians might have looked over at Poland and envied how well it had done since freeing itself from the Kremlin’s orbit and joining the European Union — that they might have then said to themselves, “We want that”— and that to get it they might have taken to the streets and overthrown Putin’s ally in Kiev, demanding a less corrupt, more transparent, democratic government.