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Ukraine Latest: Prisoners Freed; Bracing for Russian Gas Cuts

·10 min read
Ukraine Latest: Prisoners Freed; Bracing for Russian Gas Cuts

(Bloomberg) -- Ukraine sealed a major prisoner swap with Russia, an exchange that included handing over a key ally of President Vladimir Putin in return for leading defenders of Mariupol under a deal facilitated in part by Turkey and Saudi Arabia.

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Putin’s order to call up as many as 300,000 reservists to fight in Ukraine triggered protests around the country, the biggest since the early days of the war. Turkey’s president urged the United Nations to do more to push for a peace deal.

President Joe Biden excoriated Putin for making “overt nuclear threats” to Europe as the Russian leader escalated his war in Ukraine with the partial mobilization and vowed to annex territory. The G-7 followed up Thursday with similar commentary, including condemnation of Russia’s planned “sham referenda” in occupied Ukraine.

(See RSAN on the Bloomberg Terminal for the Russian Sanctions Dashboard.)

Key Developments

  • Putin’s Call-Up Brings Reality of War Home To Many Russians

  • Ukraine Frees Putin Ally for Hundreds of Troops in Major Swap

  • Russia Sets Out How Much It’s Going to Cut Gas Flow Through 2025

  • Ukraine Seizes Dozens of Russian Tanks Left by Fleeing Forces

  • Energy Crisis Empowers Europe’s Populists Harnessing Anger

  • North Korea Denies Selling Russia Arms, Blasts US for ‘Rumors’

On the Ground

Nearly seven months into the war, Russia declared a “partial mobilization” calling up 300,000 reservists in a major escalation of its flagging invasion of Ukraine. Ukrainian forces conducted strikes north and east of the city of Kherson against Russian logistics, military, and transportation assets in the Kherson region, according to the latest report from the Washington-based Institute for the Study of War. Russia hit Mykolayiv and Zaporizhzhia with 18 rockets early this morning, according to the Mykolayiv region’s governor and Zelenskiy’s office. No casualties were reported.

(All times CET)

Putin’s Mobilization Will Take Time, Won’t Solve Problems, US Says (9:46 p.m.)

Putin’s mobilization of as many as 300,000 reservists won’t happen quickly and won’t solve problems of morale and weak command that have hobbled Russian troops in Ukraine, according to the Pentagon.

“It would take time for Russia to train and prepare and equip these forces,” Brigadier General Pat Ryder, the Defense Department’s spokesman, told reporters at the Pentagon. “While in many ways this may address a manpower issue for Russia, what is not clear is whether or not it could significantly address the command-and-control, the logistics, the sustainment and importantly the morale issues that we have seen Russian forces in Ukraine experience.”

EU Rushes to Agree on an Oil Price Cap After Putin’s Threats (8:36 p.m.)

European Union member states are racing to clinch a political agreement within weeks that would impose a price cap on Russian oil.

The push has gained steam since Putin announced a “partial mobilization” of troops in an escalation of Russia’s war in Ukraine and will likely feature as part of a new a package of sanctions to be proposed by the European Commission, according to people familiar with the matter. A cap would align the EU with a US effort to keep the cost of crude from soaring and to hit Moscow’s revenue.

Despite the new effort from the commission, the EU’s executive arm, and some member states, the plan faces many hurdles and a positive outcome is not a given, said the people, who asked not to be identified because the discussions are private.

Read the full story here.

Estonian Premier Addresses Nation Amid Russia Tensions (8:34 p.m.)

In an unscheduled television address on Thursday night, Estonian Prime Minister Kaja Kallas sought to reassure her people that Russia’s mobilization posed no direct threat to the Baltic nation.

Earlier in the day, her government called up 2,861 reservists for a week-long snap military exercise that officials said was planned ahead of Russia’s announcement. “Russia’s declared mobilization has not changed the risk picture for us,” Kallas said in the TV address, while warning that Russia could take hostile non-military actions, such as disconnecting the three Baltic countries from its electricity grid. “We are exercising so that what we exercise will never be needed.”

Kallas said that some of Estonia’s 80,000 Russian citizens may also be ordered to report Russia’s military. “I believe that no one who lives in Estonia and shares our values is prepared to join the criminal war against Ukraine,” she said.

Russia Outlines Reduced Gas Flows Over Next Three Years (5:32 p.m.)

Russia set out just how much its gas flows to the global market will fall in the next three years -- and the numbers underscore the scale of the challenge facing Europe’s energy consumers.

Annual pipeline gas exports are set to drop by almost 40% to 125.2 billion cubic meters in 2023-2025, according to the nation’s three-year draft plan, seen by Bloomberg News. Pipeline gas exports is estimated at 142 billion cubic meters this year, the draft showed.

Read more: Russia Sets Out How Much It’s Going to Cut Gas Flow Through 2025

Zelenskiy Meets With Italian Defence Minister, Speaks With Saudi’s MBS (5:09 p.m.)

Ukraine’s president met with Italian Defence Minister Lorenzo Guerini, days before a national election in Italy is tipped to sweep a new right-wing government into power.

“We feel the constant support for our sovereignty and territorial integrity, as well as for the struggle for our existence, from Prime Minister Mario Draghi, the government, and the Italian people,” Zelenskiy said in Instagram post.

Zelenskiy also spoke Thursday with Crown Prince Mohammed bin Salman, a day after Saudi Arabia helped negotiate the release of foreign citizens held by Russia.

Erdogan Urges UN to Do More on Ending War (3:37 p.m.)

The United Nations must make a greater effort to end the war in Ukraine, state-run Anadolu Agency cited Turkish President Recep Tayyip Erdogan as saying.

The Turkish leader said he planned to continue “telephone diplomacy” upon his return home, and urged the UN to “take the initiative.”

Turkey’s Erdogan Urges UN to Work More for Peace in Ukraine War

Germany Ready to Take in Russian Deserters (3:30 p.m.)

Germany is ready under certain circumstances to take in deserters from the Russian army as well as opponents of Putin’s regime, according to Interior Minister Nancy Faeser.

“As a rule, deserters threatened by severe repression will receive international protection in Germany,” Faeser said in an interview with the Frankfurter Allgemeine Sonntagszeitung. “Anyone who courageously opposes Putin’s regime and therefore puts themselves in great danger can apply for asylum in Germany because of political persecution,” she added.

Latvia Tightens Rules on Residency for Russians (3:10 p.m.)

Latvia’s parliament adopted legislation to tighten rules for residency permits for Russians and Belarusians.

Under the measures, residency permits granted in exchange for investment will not be extended, and Russian citizens will also no longer be able to receive remote work visas.

Putin Ally Says Nuclear Shield to Protect Annexed Ukraine Regions (2:17 p.m.)

Former President Dmitry Medvedev, now a top security official, said Russia reserves the right to use nuclear weapons to protect newly-annexed Ukrainian regions, joining President Vladimir Putin in ramping up atomic threats.

Four regions in eastern and southern Ukraine are due to hold referendums on joining Russia starting from Friday. The votes have been denounced as “shams” by the G-7.

“The defense of all territories will be significantly bolstered by the Russian armed forces” drawn into a new mobilization announced this week, Medvedev said on Telegram.

Baltics Won’t Open Borders For Russians Fleeing Mobilization (2:03 p.m.)

The leaders of the Baltic states said their countries won’t offer asylum or humanitarian visas to Russians trying to flee Putin’s latest mobilization.

Lithuanian Prime Minister Ingrida Simonyte said humanitarian help is reserved for people who’ve consistently demonstrated their position against the war. Estonian Prime Minister Kaja Kallas said Russians are responsible for their leaders’ actions and asylum is open for opposition activists only.

“I could hardly understand a situation in which we’d allow people to enter Lithuania on humanitarian grounds just because the war was OK for them when they saw it on TV, sitting on a sofa, but it is no longer OK when your government and your (Defense Minister Sergei) Shoigu calls you to join the army,” Simonyte said.

G-7 Deplores Russia’s Referendum Plans (1:28 p.m.)

Foreign ministers of the G-7 on Thursday “strongly condemned” Russia’s plan to conduct “sham referenda” on Ukrainian territory in the next few days.

“Any referenda held under conditions of Russian military presence, intimidation, and forced deportation cannot be free or fair,” Germany’s Annalena Baerbock said in a statement on behalf of the group following a meeting at the UN General Assembly.

The ministers called on all states to condemn any votes and not to recognize the results. Further targeted sanctions on Russia are being pursued.

EU Sets Moderate Goals in New Sanctions Talks (1:04 p.m.)

The EU’s next round of sanctions targeting Russia for its latest escalation against Ukraine is likely to be limited to further trade restrictions and new listings, according to people familiar with the matter.

The bloc has been working on additional bans on key technologies and components, but there’s little appetite for major items according to one of the people. Much of the current focus is on monitoring and enforcing existing measures, including by analyzing trade flows with third countries that may be helping Moscow soften the impact of some of the sanctions imposed so far.

EU member states are also set to discuss how to change already approved oil sanctions to make way for a price cap agreed in principle by the Group of Seven nations.

Russia Says Terror Attack Thwarted on Turkey, EU Energy Link (10:41 a.m.)

Russia’s security service said it thwarted a planned terror attack on infrastructure delivering energy to Turkey and Europe, raising concerns over supplies to the region.

The Federal Security Service “prevented an attempt by the Ukrainian special services to commit a sabotage and terrorist act at the facility of the oil and gas complex that supplies energy to Turkey and Europe,” according to a statement on its website. A Russian citizen, whom the nation’s security service claimed was recruited by Ukraine’s special service, was detained.

“We are not commenting on fantasies of Russian special services,” a representative of Ukraine’s State Security Service said.

Hundreds Detained Around Russia in Anti-Draft Protests (10:23 a.m.)

President Putin’s order to call up as many as 300,000 reservists to fight in Ukraine triggered alarm and demonstrations as Russians were forced to confront the reality of the deadly conflict.

Police detained about 1,400 people at protests against the order in 38 cities Wednesday night, according to the OVD-Info monitoring group, marking the biggest protests since the early days of the war.

Some of the male detainees were handed draft notices.

Orban Says EU Should Withdraw Sanctions Against Russia (8:54 a.m.)

The European Union should scrap its sanctions against Russia by the end of this year, Hungarian Prime Minister Viktor Orban said, according to Magyar Nemzet newspaper which is closely affiliated with the premier’s party.

His call came just as EU foreign ministers agreed to bring forward additional restrictive measures against Russia as Moscow prepares to annex further parts of Ukraine.

215 Soldiers Released by Russia in Prisoner Swap With Ukraine (1:30 a.m.)

Ukrainian soldiers, including 108 defenders of the Azov battalion, have been swapped for 55 Russian prisoners, Ukrainian and Russian officials said.

“This was the most difficult prisoner exchange,” Interior Minister Denys Monastyrsky said. Saudi Arabia helped facilitate part of the swap, winning praise from western officials for the effort.

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