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Ukraine update: Scholz, Macron, Draghi to visit Kyiv; B...

World

UKRAINE UPDATE: 16 JUNE 2022

Scholz, Macron, Draghi to visit Kyiv; Biden announces additional $1bn weapons package

Svitlana, a member of Ukraine's Territorial Defence Forces, stands above a trench dug out to serve as a fighting position at her post on 15 June 2022 near Kramatorsk, Ukraine. (Photo: Scott Olson / Getty Images)
By Bloomberg
15 Jun 2022 0

Germany’s Olaf Scholz, France’s Emmanuel Macron and Italy’s Mario Draghi are planning to visit Ukraine on Thursday to meet with Ukrainian President Volodymyr Zelensky, even as Russia further tightened its grip on European energy markets by curbing gas shipments.

Shipments via the key Nord Stream pipeline dropped by about 60%, a move Germany’s vice-chancellor said was politically motivated, “to unsettle and drive up prices”. Meanwhile, President Xi Jinping reiterated China’s support for Russia’s security concerns in a phone call with Vladimir Putin.  

Earlier, US Secretary of State Antony Blinken said it’s up to Ukraine to make any decisions about territorial concessions, adding that the US and allies are working to make sure Kyiv receives the help it needs to have a strong hand on the battlefield. President Joe Biden called Zelensky and vowed to provide an additional $1-billion in security assistance for the country. 

Key developments

Putin Seen Stalling Grain Deal for Leverage

Senior European officials are not optimistic about the chances of Putin agreeing to a deal that would allow Ukraine to resume its grain exports, even as Moscow and Kyiv may take part in UN-facilitated discussions this week.

One of the people said the Kremlin had manufactured the debate as a means to get sanctions lifted and was intent on using the threat of global hunger as a bargaining tool in any future peace talks.

A number of issues remain unsolved while alternative plans to get the grain out of Ukraine are fraught with security and logistical challenges, the people said. More than 25 million tons of grain, sunflower oil and other commodities are estimated to be stuck in Ukraine.

Scholz, Macron, Draghi Plan Kyiv Visit 

The three European leaders would be making the highest-profile visit to Ukraine since Russia invaded at the end of February. Romanian President Klaus Iohannis is also set to take part in the visit, according to people familiar with the matter.  

Macron has come under fire from officials in Ukraine for his efforts to engage diplomatically with Putin. It will be the first visit to Kyiv since Russia’s invasion for Macron, Draghi and Scholz.

Ukraine Gets Western Balkan Backing for EU Ambitions 

Zelensky met with the prime ministers of Albania and Montenegro, who traveled to Kyiv to offer their backing for the nation and its ambitions to join the European Union. The leaders, Edi Rama and Dritan Abazovic, visited areas that had been under Russian occupation, expressing their support for candidacy status.

“Our countries must be full-fledged members of the European Union, and we agree that our countries are not competing on the European path but reinforce possibilities of each other,” Zelensky said during a joint press conference in Kyiv. 

Putin Opponent Navalny Moved to Strict-Regime Prison Colony

Russian opposition leader Alexey Navalny was transferred to a top-security penal colony to serve a new nine-year prison sentence, his supporters said Wednesday.

“Hi everyone from the strict-regime zone,” Navalny (46) said in an Instagram post, recounting his transfer along with his book collection, which he said weighed 50 kilograms. 

Turkey Says Position on Nato Won’t Change in Blow to June Summit

Turkey is maintaining its opposition to Sweden and Finland joining Nato unless they address its security concerns, President Recep Tayyip Erdogan said, leaving little hope that enlargement of the bloc could get underway by a summit meeting in Madrid this month.  

“We will certainly not change our stance on the Nato issue until Sweden and Finland take clear, concrete and decisive steps in the fight against terrorism,” Erdogan told his ruling AK Party legislators in parliament. 

Turkey Says Position on Nato Won’t Change in Blow to June Summit

US Announces Additional $1-Billion in Weapons for Ukraine 

The Biden administration announced $650-million in weapons and equipment for Ukraine, including for the first time launchers for vehicle-mounted Harpoon anti-ship missiles, according to a person familiar. 

The weapons package – part of presidential drawdown authority – also includes $320-million for secure radios and related equipment, $55-million for thermal, night-vision optics, and $160-million for training, according to the person. 

 

 

 

Germany Says Latest Russian Gas-Flow Cuts Politically Motivated 

Russia has tightened its grip on European energy markets, with German Economy Minister Robert Habeck saying Gazprom PJSC’s decision to curb natural gas shipments via the Nord Stream pipeline is “politically motivated.” 

The Russian gas giant had blamed a drop of 40% in shipment capacity on technical issues, with a key gas turbine that was sent abroad for maintenance ending up stuck in Canada due to sanctions. Gazprom was also unable to ship a second turbine for repairs due to the penalties. Habeck said maintenance work that would have a “relevant” impact on supply isn’t due to be carried out until the fall and, and in any case, wouldn’t affect 40% of the infrastructure.

“I have the impression that what happened yesterday is a political decision and not a decision that can be justified in technical terms,” he told reporters in Berlin. 

China’s Xi Holds Second Phone Call With Putin Since War Started 

The Chinese leader reaffirmed Beijing’s support for Russia’s sovereignty and security concerns in a phone call with counterpart Putin, the state broadcaster China Central Television reported. 

The call, which came on Xi’s 69th birthday, was the second between the two heads of state since Russia’s invasion of Ukraine in February. “China is willing to continue mutual support with Russia on issues related to sovereignty, security and issues of major concern,” Xi said, according to the CCTV report. The two leaders discussed economic cooperation, trade and military-technical ties, according to the Kremlin. 

Xi in Call With Putin Reaffirms Support for Russia’s Security

Kishida to Be First Japanese Premier to Attend Nato Summit

Japanese Prime Minister Fumio Kishida plans to attend a Nato summit later this month, showing support for its efforts during Russia’s war in Ukraine by becoming the first Japanese premier to take part in such a meeting of the military alliance.

Nato Nations to Agree on Long-Term Support Package for Ukraine

Nato member states are set to agree to a long-term support package for Ukraine as well as a new force model for the alliance when defense ministers gather in Brussels later today and tomorrow, Nato Secretary General Jens Stoltenberg told reporters.

The package is to help Ukraine’s armed forces transition from Soviet to modern equipment over the long-term and increase their interoperability with Nato standards, Stoltenberg said.

The new model would maintain more forces at higher readiness with specific contingents preassigned to allies, he said. It would also fit into the alliance’s broader plans to overhaul its long-term defense posture, with a significant increase in troops, ships and jets apportioned to defend the eastern flank. 

Macron Says Talks Needed With Putin at Some Point 

The French leader said fresh discussions between Ukraine and the European Union were needed to send a “signal of support” in a critical moment – and that a line to the Kremlin must remain open. His comments come after he caused an uproar by saying that the allies shouldn’t “humiliate” Moscow and risk a peaceful solution.

“At some point, President Zelensky will need to negotiate with Russia and we’ll also need to be at the table, bringing security guarantees,” Macron told reporters during a visit to a military base in Romania’s Black Sea coast. “This is the reality and this needs to happen.”

“Russia is a big power and we don’t want to start a war with the Russian people, but for Ukraine to win and the war to end we need to negotiate,” he said, declining to comment on reports of an imminent visit to Kyiv. 

Russia’s Oil Revenue Jumps to $20-Billion in May, IEA Says

Russia’s oil-export revenues surged to around $20-billion in May despite shipping lower volumes, as a rally in global energy prices buoyed its coffers, according to the International Energy Agency. 

That’s a 11% increase from a month earlier, taking Russia’s total revenue for shipping crude and oil products roughly back to levels before the invasion of Ukraine, even as exports fell by about 3%, the IEA estimates in its monthly report published Wednesday. 

Rosneft Examines Idea of Dubai Trading Unit 

Russia’s state oil producer has explored the idea of creating a trading venture in Dubai, the latest sign of how sanctions against Moscow are disrupting the nation’s export system.

Officials from Rosneft PJSC visited the emirate in the past month and met with advisers who could assist in setting up a new entity, according to people with knowledge of the matter, who asked not to be identified as the details are private. Rosneft didn’t immediately respond to a request for comment.

 

 

 

Eni Said to Be in Talks With Egypt on LNG Sales

Eni is in talks to boost gas imports from Egypt to Italy and Europe, as Rome looks for ways to wean itself off Russian supplies of energy, people familiar with the matter said. 

The Italian oil giant already has a deal with Egyptian state energy firm EGAS to boost flows of liquefied natural gas to Europe by 3 billion cubic meters per year, and the new agreement would see Eni and Egypt add capacity for export to Italy beyond that level within the next two years, the people said, asking not to be named discussing confidential deliberations.

Blinken Says Zelensky Makes Call on Territory

When asked about territorial concessions in an interview with PBS NewsHour, Blinken said those decisions would be made by Ukraine’s democratically elected government, including Zelensky. “Ukraine’s future is up to the Ukrainians,” he said.

Blinken added the US is working with its allies and partners to deliver assistance to Ukraine in its fight against Russian President Putin’s forces. 

“There are significant casualties on both sides. It’s horrific and it’s the result of Russia’s aggression against Ukraine,” the secretary of state said. “We are determined that Ukraine gets what it needs to deal with this aggression and ultimately to have a strong hand at any negotiating table that emerges.”

China Passes Over Russia Defender Diplomat

China transferred one of its most high-profile diplomats – and senior Russia experts – to a state media regulator, fanning speculation Beijing’s tensions with the West will influence who becomes the next foreign minister. 

Former Vice-Foreign Minister Le Yucheng (59), who has stood in for Foreign Minister Wang Yi in recent months, has been made deputy director of the National Radio and Television Administration, according to a government statement. The lateral move out of the Foreign Ministry likely removes the Russian-speaking Le from the running to replace Wang, 68, one of China’s most visible officials globally. 

Read more: China Moves Russia Defender Out of Line for Foreign Minister Job

Kostin Sees Rouble at 70-75 to US Dollar

Russia’s VTB CEO Andrey Kostin expects markets to price the rouble at 70 to 75 to the US dollar by the end of the year with a restoration of imports, Kommersant reported, citing an interview. Some companies had to freeze many large-scale projects because they can’t import equipment blocked by sanctions, which led to building up of excessive amount of foreign currency.

“The main task is to restore imports,” Kostin told the newspaper. He also expects that the Russian banking sector will return “to positive results” next year, according to his interview.

US Open to Let Russians Compete Under Neutral Flag

The United States Tennis Association will let Russian and Belarusian athletes compete in this year’s US Open under a neutral flag.

“Based on our own circumstances, the USTA will allow all eligible players, regardless of nationality, to compete at the 2022 US Open,” organisers said in a statement, adding that they continue to condemn the invasion of Ukraine.

Russia Says Critic Navalny Sent to Maximum Security Prison

Russian opposition leader Alexey Navalny has been transferred to a maximum-security prison in Melekhovo in the Vladimir region east of Moscow, Tass reported, citing comments from an official.

Navalny, who has criticised Russia’s war in Ukraine, lost his appeal last month against a new nine-year prison sentence, a move his supporters say is aimed at further isolating President Vladimir Putin’s top critic. Navalny’s spokeswoman, Kira Yarmysh, said on Twitter that his whereabouts had not been confirmed.

Ukraine Agriculture Has Lost $4.3-Billion From War 

Ukraine has suffered $4.3-billion in damage to farmland, machinery and livestock as a result of Russia’s invasion, according to the Kyiv School of Economics.

About half of the “already immense” destruction from the war comes from pollution caused by landmines and unharvested crops, according to a report by authors Roman Neyter, Hryhorii Stolnikovych, and Oleg Nivievskyi. Almost a quarter of the total – $926-million – accounts for damage done to farm machinery due to military activity and occupation, they write. 

Read the full story here. DM

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