RA’s Daily Russia News Blast – February 14, 2022

Today in Russia/CIS: Ukraine crisis leads to financial chaos; Ukraine seeks urgent OSCE meeting; Ukraine says its ultimate goal to join NATO enshrined in its constitution; Putin’s isolated worldview; US playing information warfare a la Putin?; Duma to hold vote on recognition of Donetsk and Lugansk; Ukraine vows to keep airspace open despite threats and insurance concerns;

Financial chaos. As warnings about a possible Russian invasion of Ukraine grow louder, financial markets are taking a hit. Russian stocks, as well as Ukraine’s currency the Hryvnia both, hit three-week lows. European stocks also suffered sharp drops after being ‘wrongfooted’ by US warnings over the weekend of a potential Ukraine invasion. The Financial Times wrote, “The regional Stoxx Europe 600 index fell as much as 2.9 per cent, before recovering slightly to trade 1.7 per cent lower. Germany’s Xetra Dax fell 2 per cent with sharper falls for bourses in Sweden, Austria and Greece.”

Urgent meeting. Ukraine has requested an urgent OSCE meeting to discuss Russian invasion threats. Ukrainian Foreign Minister Dmytro Kuleba said his country was seeking “a meeting with Russia and all participating states [of the Organization for Security and Co-operation in Europe] within 48 hours.” The meeting is set to be convened on Tuesday after Kyiv accused Moscow of failing to respond to its concerns about Russian troop movements along the border (a journalist has indicated that Moscow did in fact respond, but after the 48-hour window in which a response was requested).

Diplomacy first. Foreign Minister Sergei Lavrov urged President Vladimir Putin to give diplomacy more time in a meeting earlier today, possibly signaling that Moscow has not yet made up its mind on full-scale invasion. When asked whether there was still scope for compromise with NATO and the US, Lavrov said “There’s always a chance” that diplomacy could still be effective.

Spin zone (in isolation). Russia’s next moves remain shrouded in uncertainty, and that is likely how the Kremlin would like it to be. The Financial Times wrote that “the frenetic atmosphere around the deployments and the increasingly frequent airing of security grievances with the west may have already brought significant dividends for Putin, according to two people close to the Kremlin.” Putin, who has found himself physically isolated (most Russian visitors must quarantine for two weeks before seeing him), is also apparently isolated in terms of who has his ear, according to FT sources:

“The restrictions have made Putin, 69, increasingly reliant on a small group of security advisers, said a former senior Kremlin official. “His circle of contacts is getting smaller. It affects his mind,” the former official said. “He used to see things in 360 degrees — now it’s more like 60.” Many of his key advisers — such as security council secretary Nikolai Patrushev, foreign intelligence chief Sergei Naryshkin and Alexander Bortnikov, head of the FSB, Russia’s main security service — share Putin’s background in the KGB and a deep-rooted scepticism of the west that borders on the conspiratorial.”

NATO or bust. The Kyiv Post reported that “The Ukrainian Foreign Ministry has reiterated that Ukraine’s membership of NATO is stipulated as a goal in the Constitution of Ukraine. Foreign Ministry spokesman Oleh Nikolenko was responding to comments by Ukraine’s Ambassador to the UK on the possibility of Ukraine renouncing NATO membership for the sake of peace.” The comments and clarification come, of course, at an exceedingly sensitive time where the country’s potential NATO membership is one reason for Russia’s bellicose rhetoric and troop buildup.

Russia did not take these comments kindly, replying that Ukraine retracting its NATO ambitions “would facilitate security talks. Foreign Minister Lavrov also fired back at Nikolenko’s remark, declaring, “In this particular case we also paid attention to Kiev’s request the ambassador should explain his opinion. For this reason, it can hardly be interpreted as an accomplished fact Kiev has fundamentally revised its foreign policy outlook,” adding that the Ukrainian Constitution “identifies very different aims.”

Information warfare or overreaction? It is no secret that the US has been the leading trumpeter of Russia’s apparent intention to invade Ukraine. Could it be that this is a form of information warfare? As the New York Times put it, “After decades of getting schooled in information warfare by President Vladimir V. Putin of Russia, the United States is trying to beat the master at his own game” by exposing the Kremlin’s moves as the US receives intelligence about Moscow’s intentions. The series of disclosures in recent weeks about Russian activities and intentions – from troop buildups to plans to create pretexts for invasion – “has amounted to one of the most aggressive releases of intelligence by the United States since the Cuban missile crisis, current and former officials say.”

Let’s vote. Vyacheslav Volodin, the Speaker of the Duma said the Duma will hold a vote on the recognition of the occupied Donestk and Lugansk People’s Republics tomorrow, February 15, Lenta.ru reported and Volodin wrote on his Telegram.

The plenary session will consider two versions of the decision to appeal to Putin. The first draft is a document that was submitted to the State Duma by deputies from the Communist Party. It provides for immediate referral to the President immediately after possible House approval. The second draft resolution, proposed by deputies from the United Russia faction , provides for sending the document first to the Foreign Ministry , the Ministry of Defense and other responsible departments.

Please fly to us. Ukraine has allocated 16.6 billion hryvnia ($592 million) to guarantee the continuation of flights through Ukrainian airspace, Prime Minister Denys Shmygal said. The move came as insurance rates for aircraft traveling to Ukraine and over its airspace has fluctuated wildly as the fear of Russian invasion has grown. Dutch airline KLM has already announced that it was suspending flights to and over Ukraine, and a flight operated by low-cost Ukrainian carrier SkyUp traveling from Madeira, Portugal to Kyiv was forced to divert to Chisinau, Moldova after the aircraft leaser banned travel to Ukraine while the plane was mid-flight. Despite the insurance guarantees the government has pledged, it has still urged all aircraft to avoid flying over the Black Sea region.