The European Union is progressing with plans to apply a windfall tax to the profits generated by frozen Russian central bank assets, while opting not to seize the immobilised money outright.

A politician campaigning to end Russia’s war in Ukraine has collected more than the 100,000 signatures required to challenge Vladimir Putin in March presidential elections. However, that doesn’t mean he’ll be allowed to run.

Authorities in Ukraine’s second-largest city, Kharkiv, said at least four people had been killed in a Russian air strike that partially destroyed a residential building. 

Russia’s seaborne crude shipments fell to the lowest in almost two months, undermined by adverse weather and a Ukrainian drone strike that briefly halted flows from a key Baltic export terminal.

US Defense Secretary Austin asks for Ukraine aid post-surgery

US Secretary of Defense Lloyd Austin made his first public appearance since a two-week hospitalisation that provoked consternation in the White House and Congress over the Pentagon’s failure to disclose details of his illness.

Speaking by video link, Austin urged a meeting of the Ukraine Defense Contact Group to “dig deep” and support President Volodymyr Zelensky’s forces in their battle against Russia. It was a pitch also aimed at Republican legislators, who have so far refused to approve $60-billion in new funding for Ukraine even though current funding is close to running out.

A Pentagon spokesman said Austin was speaking from an office at his home, where he’s still recovering after suffering complications from prostate cancer surgery that left him hospitalised for the first two weeks of January. Austin declined to tell the White House or Congress about his hospitalisation for several days and waited even longer to disclose he’d been diagnosed with prostate cancer.

Read More: US defence chief leaves hospital after stay that caused uproar

Austin (70) was released from the hospital on 15 January and planned to work from home before returning to the Pentagon. His office hasn’t said when he’ll be back, and he made no reference to his health during the Tuesday remarks.

“Our support for Ukraine’s struggle against tyranny makes all of our countries more secure,” Austin said at the beginning of a virtual meeting of defence chiefs from almost 50 countries. “If we lose our nerve, if we flinch, if we fail to deter other would-be aggressors, we will only invite even more bloodshed and more chaos.”

Austin’s handling of his hospitalisation has drawn scrutiny from both the White House and Congress. The Pentagon has started an internal probe and the inspector-general is investigating communications related to the episode.  

EU moves ahead on plan to tax gains of frozen Russian assets

The European Union is progressing with plans to apply a windfall tax to the profits generated by frozen Russian central bank assets, while opting not to seize the immobilised money outright.

EU foreign ministers gave their political blessing to the windfall tax on Monday and it will be discussed by the bloc’s ambassadors later this week, according to people familiar with the matter.

Ukraine’s allies broadly agree that Russia needs to pay for the damage its war has caused. The EU, Group of Seven nations and Australia have frozen about €260-billion in Russian Central Bank assets in the form of securities and cash, with more than two-thirds of that immobilised in the EU. The majority of the EU-based assets are held by the clearing house Euroclear, where they earned about €3-billion last year.

The EU’s foreign policy chief, Josep Borrell, told reporters on Monday that progress was made on the windfall tax during a meeting of the bloc’s foreign ministers, and that discussions will continue. 

”I am convinced that we can move forward with this file,” Belgian Finance Minister Vincent Van Peteghem, whose country currently holds the rotating presidency of the EU, told Bloomberg TV in an interview.

Read more on frozen Russian assets:

• White House throws support behind seizing frozen Russian assets
• EU to offer initial steps for tapping Russian assets for Ukraine
• Russia’s frozen cash earns €3bn as EU mulls how to tap it

A group of countries including Germany have made clear they are against seizing the Russian assets themselves over legal concerns, said the people, who spoke on condition of anonymity.

A spokesperson from the German Foreign Ministry didn’t immediately respond to a request for comment.  

Russian anti-war candidate gathers signatures to challenge Putin

A politician campaigning to end Russia’s war in Ukraine has collected more than the 100,000 signatures required to challenge Vladimir Putin in March presidential elections. However, that doesn’t mean he’ll be allowed to run.

Supporters of Boris Nadezhdin, a member of the Civic Initiative party, braved freezing temperatures at times in long lines to add their names to his campaign application. While Russian authorities didn’t prevent the initiative, election officials must now approve the list of signatures and could deny Nadezhdin a place on the ballot. 

“I’m entering the elections as a principled opponent of the current president’s policies,” Nadezhdin said in a manifesto on his campaign website. “Putin sees the world from the past and is dragging Russia into the past.” 

Already the longest-serving Kremlin leader since Josef Stalin, Putin is seeking a new six-year term in the elections that will take place as Russia’s February 2022 invasion of its neighbour enters its third year. The result is widely expected to be a formality, and so far no strong opponent to Putin has emerged.

“Nadezhdin is the system’s player, he won’t cause problems,” said Tatiana Stanovaya, founder of the political consultancy R.Politik and a senior fellow at the Carnegie Russia Eurasia Center. “They also didn’t expect him to collect those signatures.”  

Nadezhdin has frequently appeared on political talk shows on state television during the war, expressing criticism of the conflict and offering liberal views on Russia’s development. He could play a similar role in the elections, providing an outlet for discontent without challenging the Kremlin’s tight control. 

For the Kremlin, his participation in the vote could be a way to gauge the level of anti-war sentiment in society. For Nadezhdin’s supporters, it’s a rare opportunity to voice dissatisfaction with the invasion amid the harshest crackdown on dissent in Russia since the Soviet era. 

That thousands have been arrested in Russia for speaking out against the war hasn’t seemed to deter his supporters.  

The effort is not without risk for Nadezhdin, according to Stanovaya. “For the pro-war lobby, he is the enemy and they will just make another example of him and his supporters,” she said.  

Ukraine says four dead in Russian strike on apartment block

Authorities in Ukraine’s second-largest city said at least four people had been killed in a Russian air strike that partially destroyed a residential building. 

Another 42 people were injured in the attack in the northeastern city of Kharkiv, regional Governor Oleh Syniehubov said on Telegram. Prime Minister Denys Shmyhal said four regions of the country had been targeted by Russian forces. 

The regional governor reported injuries in an assault on Kharkiv last week after Kremlin forces stepped up an aerial barrage on Ukraine in late December. Kyiv has urged its allies to provide more air defence systems as gaps in protection from missiles leave cities exposed to strikes.  

Two waves of explosions were heard in Kyiv as Russia launched missiles from planes within its territory, the Ukrainian Air Force said. At least 20 people were injured in the capital, with 13 requiring hospitalisation, while debris from intercepted missiles damaged cars and buildings in four municipal districts, Mayor Vitali Klitschko said on Telegram. 

Ukrainian forces shot down 21 out of 41 cruise and ballistic missiles launched by Russia on Tuesday, according to Ukrainian Commander-in-Chief Valeriy Zaluzhnyi. Some ballistic missiles failed to hit their targets, he said on Telegram.

Local authorities in the central Dnipropetrovsk region also said at least one person had been killed and another wounded in an attack Tuesday.   

Russian crude shipments hit by storms and Baltic drone strike

Russia’s seaborne crude shipments fell to the lowest in almost two months, undermined by adverse weather and a Ukrainian drone strike that briefly halted flows from a key Baltic export terminal.

About 3.36 million barrels a day of crude were shipped from Russian ports in the four weeks to 21 January, tanker-tracking data monitored by Bloomberg show. That was down by 50,000 barrels a day from the revised figure for the period to 14 January.

The more volatile weekly average fell by 340,000 barrels a day to a seven-week low of 3.02 million. Exports were hit by continuing bad weather at some ports and a Ukrainian drone strike on a condensate processing facility adjacent to the Ust-Luga crude export terminal, which interrupted loading on Sunday, pushing one shipment from the week ending 21 January into the following week.

Port maintenance and more poor weather may depress shipments again this week, while the drone attack has opened up a new front in Moscow’s war on Ukraine that highlights the vulnerability of oil exports from Russia’s western ports. DM