Warsaw sought to de-escalate a spiralling dispute with Kyiv by walking back remarks from its premier that the country had stopped weapons shipments to Ukraine. That came after the two nations’ leaders exchanged barbs in an argument over a Polish ban on Ukrainian grain.

Russia launched the largest missile attack against Ukraine’s power grid since early spring after Ukrainian President Volodymyr Zelensky urged the United Nations Security Council to revoke Moscow’s veto rights at the body.

Latest developments

• Zelensky presses US lawmakers for aid as opposition persists
• McCarthy says Biden needs to address border before Ukraine aid
• Yellen signals support for windfall tax on frozen Russian assets
• Poland seeks to mend Ukraine rift with arms supplies U-turn
• Russia hits Ukrainian power grid with missiles as UN meets

Germany faces criticism over company’s renewed LNG trade with Russia

The German government is facing criticism over its energy ties as a taxpayer-backed company re-enters the liquefied natural gas trade with Russia.

Securing Energy for Europe — a former unit of Russian gas giant Gazprom — plans to load LNG produced by the Yamal plant in Siberia early next month. Germany nationalised the company, known as SEFE, last year at the height of Europe’s energy crisis.

Although the cargo is headed for India, a German state-owned company doing deals with Russia is causing some alarm. Critics say it flies in the face of Germany’s pledge to avoid handling Russian LNG in the fallout of the Kremlin’s war in Ukraine.

“This contradicts pretty much everything the German government has said on the subject in the past,” said Christian Leye, a member of parliament from the opposition Left Party group. “The economic entanglements with Russia are apparently not as easy to resolve as politicians would have us believe.”

Poland may send more older weapons to Ukraine later, says Duda

Poland may send more of its older weapons to Ukraine at a later date, once the country receives new equipment ordered in South Korea and the US, President Andrzej Duda said on Thursday.

“We cannot transfer our new weapons that we buy to strengthen Poland’s security or modernise the Polish army,” Duda told private broadcaster TVN during a visit to New York. “We’ve signed agreements with Ukraine regarding, among others, ammunition and special vehicles, and we are implementing them.”

Read more: Poland seeks to mend Ukraine rift with arms supplies U-turn

The Polish government earlier on Thursday sought to walk back remarks by its prime minister that the country had stopped weapons shipments to Ukraine, which added to tensions between the two countries amid a dispute about grain exports from the war-torn nation.

Ukraine should show understanding for Poland’s decision to impose restrictions due to “a flood of grain” on its market, according to Duda.

“It’s against our interests, we have to watch our market,” Duda said. “It’s hard not to understand what decisions the government has taken.”

Zelensky presses US legislators for aid as opposition persists

Zelensky pressed US legislators privately on Thursday for sustained support to counter Russia’s war machine in a conflict that allies now fear will drag on for years, just as hardline Republicans are threatening to halt additional aid.

Zelensky met on Thursday with military leaders at the Pentagon and with President Joe Biden at the White House. But the success of his trip hinges on his visit to Capitol Hill and his ability to persuade ultra-conservatives who represent a small but crucial bloc of the Republican majority in the US House.

“Zelensky said, ‘If we don’t get the aid, we will lose the war,’” Senate Majority Leader Chuck Schumer said following the Ukrainian president’s meeting with senators.

Topping Zelensky’s requests during the meetings were F-16 fighter jets, as well as the longer-range ATACMS missiles that Kyiv has long sought, House Foreign Affairs Chairman Michael McCaul said after the meeting, which lasted less than an hour.

“A war of attrition is not going to win this. That’s what Putin wants, is to break the will of the American people,” said McCaul, who is among the Republicans who support ongoing aid. “We can’t afford a war of attrition. We need a plan for victory, and we need to do it soon.”

Continued backing from the US and its allies is vital for Zelensky as his forces struggle to advance against Russian troops still occupying about 17% of his territory, fuelling doubts about his ability to oust them completely.

After the meeting on Thursday, House Speaker Kevin McCarthy said Zelensky “answered a lot of my questions”. Reiterating his support for Ukraine in the war, McCarthy said he’s “more than willing to look at” the requested aid package but he wants Biden to address the US border with Mexico before funding Ukraine.

UAE considers export controls that may hurt Russia’s war machine

The United Arab Emirates is considering introducing export licences for a list of items including chips and other components that are sanctioned by the US and European Union and used by Russia’s military in Ukraine, according to people familiar with the matter.

If implemented as envisaged, the system could see permits withheld for dual-use goods destined for the battlefield, potentially hurting the Kremlin’s ability to feed its war machine. The people, who spoke on condition of anonymity to discuss private matters, cautioned that the Persian Gulf nation has yet to make a final decision.

Asked about the plan, a UAE official said the country takes its responsibilities as a business hub seriously: “The UAE has a legal export control framework in place and is continuously monitoring the export of dual-use products.”

Russia has so far been able to get around some of the trade restrictions imposed on it by the US, UK and Europe by routing banned goods via third countries such as the UAE, Turkey and some Central Asian nations that have not introduced sanctions themselves.

Bulgarians accused of spying for Russia to face UK charges

Five Bulgarians suspected of spying for Russia are set to be formally charged by UK prosecutors, the Crown Prosecution Service said on Thursday.

Three men and two women will be accused of conspiring to collect information for the Russian state for almost three years until February, the agency said.

Orlin Roussev (45), Bizer Dzhambazov (41), Katrin Ivanova (31), Ivan Stoyanov (31), and Vanya Gaberova (29), will all be charged with the same criminal offence.

The move follows an investigation by the Metropolitan Police’s Counter Terrorism Command. The five defendants will appear at Westminster Magistrates’ Court on 26 September. Law enforcement authorities across Europe have been seeking to disrupt Russian spy networks since the full-scale invasion of Ukraine, with several countries also expelling diplomats.

Putin’s tilt on flashpoint region exposes rift with ally Armenia

A week before Azerbaijan began its lightning military campaign to force the surrender of Armenians in Nagorno-Karabakh and take full control of the contested region, Vladimir Putin signalled Russia wouldn’t stand in the way.

Since Armenian Prime Minister Nikol Pashinyan had recently recognised that Nagorno-Karabakh was part of Azerbaijan, “What is there to discuss?” Putin said at his flagship Eastern Economic Forum in Russia’s Vladivostok on 12 September. “Armenia determined the status of Karabakh itself. That is all there is to it.”

His words may have amounted to a green light for Azerbaijani President Ilham Aliyev to begin Tuesday’s attack despite the presence of some 2,000 Russian troops in Nagorno-Karabakh tasked with maintaining a truce that Putin himself brokered to stop a 2020 war between Azerbaijan and Armenia. When some of those peacekeepers were killed in the two-day assault, Russia made no threat of retaliation. Aliyev apologised in a phone call with Putin on Thursday, the Kremlin said.

Officials from Baku and Nagorno-Karabakh held their first meeting on Thursday aimed at the “reintegration” of the region into Azerbaijan more than 30 years after its majority Armenian population declared independence during the Soviet Union’s collapse. Nagorno-Karabakh’s Defence Army will disarm and disband under the deal mediated by the Russian forces to end the fighting.

Thousands of angry protesters have taken to the streets in Armenia’s capital, Yerevan, accusing Pashinyan of selling out their ethnic kin in Nagorno-Karabakh and blaming Russia for failing to come to the aid of its ally against Azerbaijan.

WTO posts Ukraine trade dispute case versus its EU neighbours

The World Trade Organization (WTO) on Thursday published Ukraine’s request for dispute settlement proceedings after Poland, Hungary and the Slovak Republic banned imports of a range of Ukrainian agricultural goods.

Ukraine’s request for consultations marks the first formal step of the WTO’s lengthy dispute resolution process and could escalate into Ukraine’s first WTO dispute case as a plaintiff against a European Union member. Ukraine is simultaneously working to join the 27-nation bloc.

Ukraine alleged that the bans violate various provisions of the WTO Agriculture Agreement and the General Agreement on Tariffs and Trade, according to a copy of the complaints.

Yellen signals support for windfall tax on frozen Russian assets

US Treasury Secretary Janet Yellen voiced support for a European Union plan to impose a windfall tax on profits generated by frozen Russian sovereign assets, calling it a “sensible” way to help finance the reconstruction of Ukraine.

“This seems like a reasonable proposal,” Yellen said in an interview with Bloomberg reporters and editors in New York on Wednesday, adding that the US was discussing the idea with the EU. “It’s a different thing than seizing the assets.”

The Biden administration has come under pressure to seize the funds outright, something Yellen has said would be illegal under current law. The EU’s legal service reached a similar conclusion, which led to the alternative idea of taxing the profits earned on the frozen funds.

Opening the way to tap profits from Russian funds for Ukraine’s benefit may help boost support for continued aid to Kyiv as the war drags on. The Biden administration is pushing Congress to approve an additional $24-billion in assistance, but faces growing scepticism from some Republicans.

Yellen and other US officials have weighed endorsing the proposal to help unlock the debate over it in Europe, according to a person familiar with the matter.

Poland seeks to mend Ukraine rift with arms supplies U-turn

The Polish government sought to walk back remarks by its premier that the country had stopped weapons shipments to Ukraine, tapping the brakes on an escalating dispute that’s shaken a key wartime alliance.

After Prime Minister Mateusz Morawiecki said Poland was no longer transferring weapons to Ukraine, his office aimed to lower the temperature following a heated exchange of barbs this week that’s dismayed allies and undermined a relationship that’s been crucial to aid for Kyiv.

“Poland is only carrying out previously agreed supplies of ammunition and armaments, including those resulting from the contracts signed with Ukraine,” government spokesman Piotr Muller said. Those include a contract to deliver locally manufactured howitzers, he added. “Poland consistently helped repel Russia’s attack.”

The sparring marked a sharp contrast to the unity on display between the two allies since Russia’s invasion last year, with Poland a key conduit of weapons and aid to Ukraine. But the comity reached its limit after Warsaw extended a unilateral ban on grain imports to appease restive farmers, an important constituency for the ruling party ahead of a tightly contested election on 15 October.

The prime minister’s statement on weapons to Ukraine was misunderstood and wrongly interpreted, a government official said on condition of anonymity. Another official said Poland has no more weaponry that can be donated, but ammunition shipments would continue.

An easing also appeared to be possible on the grain front a day after Morawiecki threatened to expand import restrictions to other Ukrainian products. The two countries’ agriculture ministers agreed in a phone call to seek a solution.

Russia hits Ukrainian power grid with missiles as UN meets

Russia launched the largest missile barrage to target the Ukrainian power grid since early spring, hours after Zelensky urged the United Nations Security Council to revoke Moscow’s veto rights at the body.

The attack left parts of five regions, including the one around Kyiv, without electricity, the national grid operator Ukrenergo said on Telegram.

“It’s impossible to say whether this is the beginning of a new massive terrorist wave of targeted attacks on the power system,” Ukrenergo’s chief executive officer Volodymyr Kudrytskyi said on Facebook, adding that his company was preparing for any scenario. The strike also damaged substations, cutting power for more than 50,000 households, according to the Energy Ministry.

Russia fired 43 cruise missiles from strategic bombers in several waves overnight. They entered Ukraine from various directions and continually changed their course, army chief Valeriy Zaluzhnyi said on Telegram. The country’s air defence downed 36 missiles, he said.

At least seven people were hurt when missile debris fell on several districts of Kyiv, damaging a gas pipeline, a hostel and a non-residential building, and interrupting water and electricity supply to parts of the capital, Mayor Vitali Klitschko said on Telegram. Kyiv city administration said around 20 missiles were shot down.

Authorities said a second wave of Russian attacks across Ukraine targeted the northeastern city of Kharkiv, central Cherkasy, the western city of Rivne and the Lviv region near the Polish border. Ten people were injured after a strike on a hotel in Cherkasy and at least 20 others may be trapped in the ruins, according to local officials, while two people were reported hurt in Kharkiv.

Russia reported 19 Ukrainian drone attacks on Crimea, the Black Sea peninsula annexed by Moscow in 2014. In what appears to be a widespread retaliatory strike for the Kremlin’s invasion of Ukraine, drones also hit the Orel, Kursk and Belgorod regions, according to the Russian Defence Ministry, which reported no casualties and said it had downed several of them.

Russia takes aim at exporters with new tax targeting windfall

Russia plans a new tax on exporters to soak up excess revenue companies reap when the rouble depreciates past a certain level and to support its strained wartime budget.

The Finance Ministry is proposing a levy on exporters that kicks in once the rouble weakens past 80 per US dollar, four people familiar with the situation said, declining to be identified as the decision isn’t final. Oil, gas, grain and some other goods would be excluded under the plan, leaving industries like metal and mining to shoulder the biggest burden.

The rouble is the third-worst-performing currency this year in emerging markets after briefly depreciating past 100 per dollar in August. A weaker domestic currency can boost revenue from exports in rouble terms. The new tax would help funnel some of that windfall toward the budget, which remains under pressure from the financial drain of the war in Ukraine. The rouble traded at 96.3 per dollar at 10.57am in Moscow.

The tax is expected to generate about $1-billion a month at the current exchange rate, said one of the people, who is close to the government. DM