Russia/Ukraine War Update - July 5th, 2022

*** MILITARY SITUATION ***

 

-The Russian parliament has approved laws to begin Industrial Mobilization. This likely precedes a general military mobilization to be announced in the next few weeks that will put Russian state on a war footing in preparation for the coming winter campaign.

-On Monday, Russia’s defence minister, Sergei Shoigu, told Putin that “the operation” in Luhansk was complete. The Russian president said the military units “that took part in active hostilities and achieved success, victory” in Luhansk “should rest, increase their combat capabilities”.

-"Успешно проведена наступательная операция по освобождению территории ЛНР. В течение двух недель окружены и ликвидированы группировки в Горском котле в районах Лисичанска и Северодонецка. <…> Операция завершена вчера освобождением одного из крупнейших городов ЛНР, Лисичанска. Всего в ходе активных наступательных действий взято под контроль 670 квадратных километров территории. Общие потери ВСУ составили 5 469 человек, в том числе безвозвратные 2 218", - сказал он.По словам Шойгу, также ВСУ потеряли 196 танковых и бронированных машин, 12 самолетов, один вертолет, 65 беспилотников, шесть зенитных ракетных комплексов большой дальности, 97 ракетных систем залпового огня, 166 орудий полевой и минометной артиллерии, 216 автомобилей. "В Лисичанске противник бросил 39 танков и других бронированных машин, 11 орудий и минометов".

Translation: "An offensive operation was successfully carried out to liberate the territory of the LPR. Within two weeks, groups in the Gorsky cauldron in the areas of Lisichansk and Severodonetsk were surrounded and liquidated. <...> The operation was completed yesterday by the liberation of one of the largest cities of the LPR, Lisichansk. control of 670 square kilometers of territory. The total losses of the Armed Forces of Ukraine amounted to 5,469 people, including irretrievable 2,218," he said. According to Shoigu, the Armed Forces of Ukraine also lost 196 tanks and armored vehicles, 12 aircraft, one helicopter, 65 drones, six long-range anti-aircraft missile systems, 97 multiple launch rocket systems, 166 field and mortar artillery guns, 216 vehicles. "In Lisichansk, the enemy threw 39 tanks and other armored vehicles, 11 guns and mortars".

-Fresh of their victory over the key stronghold of Sievierodonetsk, Russian forces have claimed victory over its sister city of Lysychansk, which puts Russia in total control of the Luhansk province. Russian Defense Minister Sergei Shoigu affirmed as much in a Sunday statement, while the Ukrainian regional governor of Luhansk, Serhiy Haidai, said the "city is on fire". "Sergei Shoigu has informed the commander in chief of the Russian armed forces, Vladimir Putin, of the liberation of the People's Republic of Luhansk [LPR]," the defense ministry said in a statement.

-Ukraine’s president, Volodymyr Zelenskiy, vowed to regain Lysychansk with the help of long-range western weapons. “We will return thanks to our tactics, thanks to the increase in the supply of modern weapons. Ukraine does not give anything up,” he said in an evening address.

-Ukrainian forces fired a Tochka-U missile at Russian territory in the center of the city Belgorod, Russia. The rocket hit a civil area with small houses. Reported - 5 people killed.

-Ukrainian forces likely used US-provided HIMARS rocket artillery systems to strike a Russian ammunition depot at the Melitopol airfield on July 3. Melitopol Mayor Ivan Fedorov reported that Ukrainian forces launched two strikes on one of the four Russian depots in Melitopol.

-A Russian ammunition dump was hit far behind the lines in Snizhne, Donetsk Oblast. Those ground branch or special ops forces operating the HIMARS for the Ukrainians are doing a great job hitting strategic targets deep in Russian territory. I'm sure the Russians will figure out where those are soon enough.

-The Ukrainian flag has been delivered by helicopter to Snake Island in the Black Sea after Russian forces withdrew from the strategic outpost last week, and it will be raised as soon as Ukrainian troops arrive, Ukraine’s military said on Monday. Natalia Humeniuk, spokeswoman for Ukraine’s southern military command, had initially said the flag had been raised on the craggy outcropping in the Black Sea, Reuters reported. “The flag has been delivered to the island by helicopter,” Ukrainian media quoted Humeniuk as telling CNN television. “It will await the arrival of troops and will then be hoisted.”

As I read thru the Gaurdian's Ukraine Live Coverage, it occurs to me that if this was my only source for news, I would have almost no idea as to what was actually happening in the war, but I would know about every house, school, hospital, and clinic that a Russian shell fell on. I would know the Ukrainian flag was raised on snake Island, but I would have no idea that the Ukrainians lost upwards of 6,000 men, including over 2,000 KIA, in the fall of the Lysychansk  cauldren. I begin to see that the entire Snake Island operation was intended all along as a PR campaign. They knew Lysychansk was about to fall, so they needed to be able to show the Ukrainian people a victory, even a hollow and irrevalant one. They have to give the western media something to report other than their defeats on the battlefield. The Ukrainian regiem really are masters of propoganda and narrative manipulation. If only they would tell their people the truth, but then again, our government doesn't tell us the truth either. I wonder if any government, anywhere, tells their people the truth. India maybe?

*** ECONOMIC & POLITICAL ***

-The eventual restoration of Ukraine through a $750bn (£620bn) recovery plan is the common task of the entire democratic world, the Ukrainian president, Volodymyr Zelenskiy, said on Monday at the first detailed event to map out a physical future for the country in the event it survives as a western-facing nation after the Russian invasion.

-Britain said it would on Tuesday introduce new economic, trade and transport sanctions on Belarus over the country’s support for Russia’s invasion of Ukraine.

-Britain is proposing a new law that will require social media companies to proactively tackle disinformation posted by foreign states such as Russia.

-If you look at the trajectory of inflation in the US, it was already at 7.5% before the Ukraine war started. Having said that, I think many experts are underestimating how much worse it could get, particularly if the US stirs things up in other hotspots like Syria or Taiwan to demonstrate it’s still the big dog on the world stage. On the potential for depression front, Germany, the UK and much of Northern Europe are going to hit a wall this winter due to energy shortages if they don’t change course, and their inability to admit the economic war with Russia is a disaster for them means they won’t. BASF is already threatening to shutter the biggest chemical complex in the world, over 200 plants in Germany. Business shutdowns will mean a collapse in employment and tax revenues. And Germany, the UK, and other European countries are also warning of very large food price increases coming. Italy is also heavily dependent on Russian gas and has wobbly banks and a fragile economy. And we haven’t even factored in the impact of sovereign debt crises and starvation in developing countries, particularly those who borrowed in dollars or have dollarized currencies. So Europe could go into crisis this winter. Due to the strength of the dollar (and aggressive US buybacks), European companies are less important to US indexes than they were in 2010. But some of the stressors that could pummel Europe will also affect the US, although perhaps not quite as severely. But it’s hard to see how a banking meltdown, which is entirely possible, won’t hit US financial assets hard.

-The mayor of Lappeenranta, a small Finnish city close to the border with Russia, would put his township in Russia’s sights by hosting a NATO military base, the speaker of the Russian State Duma, Vyacheslav Volodin, said on Monday. Volodin was commenting on a story published by Finnish media about a border town that expects an increase in investments after the nation joins the US-led military bloc. Kimmo Jarva, the mayor of Lappeenranta, hinted that his town would like to host a military base. Finnish broadcaster Yle cited Jarva as saying that formal accession to NATO would bring “a sense of security” to the people and businesses in the region of South Karelia. The Russian State Duma speaker said the mayor is mistaken about how security works, due to the fact that military infrastructure would be targeted first should a conflict between the two nations break out.

-Washington believes it’s too early to discuss peace talks between Moscow and Kiev since neither side is ready for such negotiations, the National Security Council (NSC) Coordinator for Strategic Communications John Kirby told Fox News on Sunday. When asked whether US President Joe Biden should “push” Russia and Ukraine towards peace talks, Kirby said instead it was “time for the US to continue to support Ukraine.” Washington’s goal is to make sure Kiev “gets to determine how victory is decided” in the ongoing conflict and “on what terms.” “We do not want to see Ukraine defeated by Russia and that is why we are continuing to rush aid and assistance,” the senior NSC official said, adding that the US alone has already allocated $7 billion in aid and assistance to Ukraine.

-Ukraine is holding talks with Turkey and the United Nations to secure guarantees for grain exports from Ukrainian ports, Volodymyr Zelenskiy said on Monday.

-Ukraine PM: confiscated assets from Russian oligarchs should fund recovery

-Western envoys in China have criticised Russia for its invasion of Ukraine, with the US ambassador saying China should not spread Russian “propaganda”, during an unusual public forum in a country that has declined to condemn Moscow’s attack.

-Russia's says it's preparing to respond in kind after Bulgaria expelled up to 70 Russian diplomats from its territory on Sunday. Starting June 28, the Bulgarian government declared that Russian diplomats in the eastern European NATO country "persona non grata" as they were "working against" Sofia's interests, and they were given until July 3rd to depart Bulgaria. Bulgaria's acting Prime Minister Kiril Petkov said, "Anyone who works against the interests of Bulgaria will be called to go back to the country from which they came." The Associated Press confirmed on Sunday that "Two Russian airplanes were set to depart Bulgaria on Sunday with scores of Russian diplomatic staff and their families amid a mass expulsion that has sent tensions soaring between the historically close nations, a Russian diplomat said." Russia's ambassador to Bulgaria had earlier stated that Moscow is ready to close its embassy in Sofia altogether in retaliation for the expulsions.

-Ukraine plans to present a recovery plan at a national reconstruction forum in Lugano, Switzerland on July 4-5. European Union officials said the 27-member bloc that formally recognized Ukraine as a candidate last month would provide the bulk of the overall financial aid, which could top €500 billion. It is noted that the Ukrainian authorities discussed the draft of the project with donors, including the EU countries.

-Australia will send more than $100m in new aid to Ukraine including military equipment.

-The UK may follow the example of Canada and seize the assets of Russians in Britain in order to give them to Ukraine.

-Thousands of Polish people took part in a pro Russian and pro  BRICS rally in Warsaw. A way of saying no to NATO and the G7.

-The president of Belarus and Vladimir Putin’s closest ally has said his ex-Soviet state stands fully behind Russia, adding that the country’s “have practically a unified army”.

-Jeff Bezos accused the U.S. president of either deliberately misleading the public or lacking a “basic” understanding of the forces that actually drive prices.

-Global oil prices could reach a “stratospheric” $380 a barrel if US and European penalties prompt Russia to inflict retaliatory crude output cuts, JPMorgan Chase analysts warned. The Group of Seven leading industrial nations are working out a complicated mechanism to cap the price fetched by Russian oil in an attempt to tighten the screws on President Vladimir Putin amid Russia's invasion of Ukraine. But Moscow can afford to reduce daily crude production by 5 million barrels without excessively damaging the Russian economy, JPMorgan analysts including Natasha Kaneva wrote in a note to clients. For much of the rest of the world, however, the results could be disastrous. A 3 million barrel cut to daily supplies would push benchmark London crude prices that are now around $111 to $190, while the worst-case scenario of 5 million could mean “stratospheric” $380 crude, the analysts wrote. “The most obvious and likely risk with a price cap is that Russia might choose not to participate and instead retaliate by reducing exports,” the analysts wrote. “It is likely that the government could retaliate by cutting output as a way to inflict pain on the West. The tightness of the global oil market is on Russia’s side.”

-The shifting nature of the war in Ukraine has prompted a split among analysts and U.S. lawmakers, with some questioning whether American officials have portrayed the crisis in overly rosy terms while others say the government in Kyiv can win with more help from the West. The growing conjecture comes more than four months after Russia’s invasion and its failure to seize the capital. Russian President Vladimir Putin has since narrowed its objectives, focusing on capturing eastern Ukraine’s industrial Donbas region while launching thousands of artillery rounds per day at outgunned Ukrainian forces. Biden and NATO send Russia a defiant message. U.S. officials acknowledge that as Russian forces have massed firepower, they have gradually seized territory in the east. That includes capturing the strategically important city of Severodonetsk in June and threatening to do the same in its nearby sister city, Lysychansk. U.S. officials have downplayed the gains, calling them halting and incremental, while highlighting the significant number of Russian military fatalities that have come as a result. But the Ukrainians have sustained heavy casualties, too. Independent estimates indicate each side has seen tens of thousands of soldiers killed and wounded. The Pentagon has largely refused to publicly discuss its assessments of killed and wounded. The Defense Department’s overriding concern about discussing the Ukrainian military is balancing what can be said at an unclassified level and not providing an “unintended assessment” that Putin can use to his advantage, Pentagon spokesman Todd Breasseale said. “We’re simply not going to do Russia’s BDA or intel work for them,” Breasseale said, using a military acronym for battle damage assessment. “However, I think we have discussed what we can, when it is knowable, demonstrable and objective.”