Putin is losing the war, so prepare for escalation
“It surprised a lot of people because they didn’t think Ukraine could reach that far. We’re clearly seeing the effects of deep strike technology,” he told the Royal United Services Institute this week.
Zagorodnyuk said that the old war is actually dead. Much of Russia’s massive military hardware is useless. The war has turned into a high-tech race and Ukraine is one step ahead.
Wall StreetJournal says Trump administration now actively assists with long-range intelligenceWe have crossed a line that Joe Biden never dared to cross.
All optimism about the Trump-Putin summit in Alaska two months ago has evaporated.
“Our relations are collapsing and the Americans are responsible for this,” said Russian deputy foreign minister Sergei Ryabkov.
20 regions of Russia face fuel rationing. Gas stations limit sales to 30 liters in most of the country. Many have stopped selling 95-grade fuel altogether.
Russia was producing 9.7 million barrels of oil per day in 2023. Goldman Sachs says this has fallen to 9 million barrels/day and could move towards 7.5 million barrels/day.
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The refinery crisis is causing a buildup of unstorable crude oil. Goldman Sachs said drillers were reeling from 17 percent interest rates and a growing “tax wedge.”
Energy and Clean Air Research Center It says total export revenues from Russian oil, gas and coal have fallen for three years, reaching a new low of 546 million euros ($980 million) per day in August.
This is not enough to sustain a Russian war machine that, in one way or another, consumes a tenth of the national income. The liquid component of the reserve fund fell below 2 percent of GDP.
The Kremlin is pursuing desperate taxes. He’s even working on a “parasitism tax” for shirkers, excluding only retirees, the disabled and the seriously ill.
Russia’s “hot” military-Keynesian economy supported growth, but at the cost of deepening deformation.
Putin has hidden the real deficit by forcing banks to lend to the military-industrial complex, but this means piling up a banking crisis and that is the end of the road.
The financial loss is now colliding with a second serious threat to Russia: the possibility of a prolonged collapse in oil prices as Saudi Arabia and Gulf states flood the global market.
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US Energy Information Administration He expects oil prices to reach US$50 in 2026. Goldman Sachs says that if the world economy slows down and the Gulf countries maintain their market share maximally, Brent may drop to 40 USD.
In real terms, this is comparable to the oil market collapse that brought down the Soviet Union in the 1980s. On the other side of the ledger, low oil prices serve as tax breaks for Europe’s oil-importing states. The pendulum of pain is swinging in the West’s favor.
The clock is ticking for Putin, and this is exactly the imminent danger facing Europe.
“He always raises the bar when things go wrong. He may try to go beyond Ukraine to avoid losing,” said Zagorodnyuk, who is now head of the Center for Defense Strategies in Kiev.
“The view of my colleagues in Eastern Europe is that the likelihood of the war escalating in Europe is now extremely high and they are very concerned,” he said.
Russia’s war economy is producing weapons at full speed
From a Western perspective, it seems like suicide for Putin, who is unable to defeat Ukraine, to even consider such a crazy move; but it may gain more tactically from softer targets in Moldova and even beyond NATO lines.
While the war economy is producing weapons at full speed, Germany and NATO countries in Europe are just starting to close the gap. The window of opportunity will never be this wide again.
A well-chosen conflict can reveal deep divisions within NATO.
Vulnerabilities are well known. Ethnic Russians make up 85 percent of the population Narva city in EstoniaIt sits on the border with Russia. This is where Peter the Great won his first major victory over the Swedish empire, and Putin’s portrait hangs above his desk.
These are dangerous times. If the West shows even the slightest sign of weakness, they become more dangerous.
It wouldn’t be difficult to revive a dark irredentist complaint. Hitler’s Sudetenland playbook – deceives those who want to be deceived.
Otherwise he could Creating trouble at Suwalki Pass It runs from Belarus via Lithuania to Kaliningrad, Russia’s Baltic region. Putin can escalate tensions anywhere to confuse the West.
Zagorodnyuk said there is another geopolitical change in this story.
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The talk in security circles is that Putin has reached a workable agreement with Xi Jinping: Russia is wearing down NATO with air incursions and cyber attacks, trying to sow division and scare appeasers; China, on the other hand, is stopping the collapse of the Russian economy and is committed to staying on this path.
Chinese foreign minister Wang Yi stunned EU officials in July Makes clear Beijing must keep Russia in war To prevent the United States from turning all its attention to China.
RBC Capital’s Helima Croft, China It is rapidly filling its strategic oil reserves. American intelligence analysts suspect that China is preparing for a showdown with the United States over Taiwan.
How would Trump react to the Chinese navy’s adjusted customs blockade of Taipei?
These are dangerous times. If the West shows even the slightest sign of weakness, they become more dangerous.
A better reflex would be to hold an economic knife to Putin’s throat by closing the Denmark Straits to any ship in Russia’s shadow fleet that violates clean navigation rules.
Zagorodnyuk promising template Crimean War of 1853-1856. Russia did not lose to France and Britain because it was defeated in battle or because it ran out of men and artillery. He lost because his silver-based currency regime collapsed, triggering hyperinflation.
His archaic serf-based army was no match for the technology and structure of a modern army.
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The reactionary Tsar Nicholas I, who started the war with the false confidence that Britain and France would never join forces, eventually accepted the harsh terms of defeat because the costs of continuing the war had become unbearable.
Needless to say, in democracies the Tsar had his cheerleaders. A Karl Marx wrote in his column: New York Daily Tribune that “a certain class of writers” were fascinated by this cruel, reckless and unlikable autocrat.
He was attributed “extraordinary strength of mind and especially the ability of far-reaching, comprehensive reasoning which marks the truly great statesman”.
Some things never change.
