BEN MORGAN: Disappointments for Ukraine, but more bad news for Russia

During the last couple of weeks Ukraine has dropped off the mainstream media’s radar, replaced by the Iran-Israel War.  Regardless of the lack of media interest, the war Ukraine continues and the prospects for a ceasefire or peace remain grim.  

Strategically, Ukraine suffered some recent setbacks but Russia appears to be weakening faster. Europe continues to support Ukraine regardless of some US aid cutbacks, and there are new signs that Russia’s economy is in trouble.  The most significant being Putin’s 27 June announcement that Russia plans to cut military spending next year.  A decision that can be linked to Putin’s earlier statements at the St Petersburg International Economic Conference where he said that that Russia must avoid slipping into a recession “under any circumstances.”  

The St Petersburg International Economic Forum is an annual event designed to showcase the Russian economy, and to attract overseas investment. So, it is notable that some of Putin’s key officials were sounding alarm bells. Elvira Nabiullina, governor of the Russian Central Bank, spoke at the forum and said that “We grew for two years at a fairly high pace because unused resources were activated,” and that “We need to understand that many of those resources have truly been exhausted.” Even more dramatically, Russia’s Minister for Economic Development, Maxim Reshetnikov warned that the country’s economy is “on the brink of recession.”

Russia has used up its cash reserves paying large wages, cash bonuses and death benefits to attract soldiers; and pouring money into the defence industry.  Now a moment of reckoning is approaching, the Russian economy is not in immediate collapse but is tracking in line with many commentators predictions and starting to fail.   

Further evidence of Putin’s concern is provided by Russia’s recent expansion of laws covering state secrets to include data related to trade, foreign policy, economic policy, scientific and plans for mobilisation.  Historically, clamping down on sharing information with the public is a sign of a regime under pressure. 

Further, Ukrainian estimates of Russian casualties have now passed 1 million dead or seriously wounded.  Ukraine’s figures are often challenged but Open-Source Intelligence (OSINT) work by Russian news service Mediazona, working in conjunction with the BBC confirms at least 111,387 Russian deaths.  And, even this figure is significant when seen in a wider perspective, for example during nine years of war in Afghanistan, Russian casualties were lower, approximately 70,000 killed and wounded.   

Massive losses both on the battlefield and of talented young people emigrating, combined with an unsustainable economy means cracks are starting to appear in Russia.  A situation that is causing the Kremlin concern.

Iran compounds Russia’s diplomatic loss in Syria

The Ukraine War has compromised Russia’s strategic position and international influence.  Russia’s inability to support the Assad regime in Syria or to provide meaningful assistance to Iran undermines a key plank of Russian diplomacy military aid.  The Peace Research Institute Oslo summarised the situation as follows “Moscow, sidelined by its limited military and economic tools, is watching its influence recede across Syria, Iran, and the Organization of the Petroleum Exporting Countries Plus (OPEC+) structures.”

Russia influence in the Middle East is important because it buys drones from Iran, and works together with OPEC+ countries to set oil prices.  Russia’s loss of diplomatic power in the Middle East is likely to ripple outwards into other regions like.; Africa, Central Asia and South America. 

Is Putin’s reduction in military spending a ploy?

Some commentators argue that Putin’s announcement he intends to reduce military spending is a manoeuvre designed to influence the US, by demonstrating to President Trump that Russia is a reasonable partner.  A thesis that is supported by recent US announcements stopping shipments of some weapons to Ukraine, and the Trump White House’s policy on sanctions. 

In my opinion, Putin is probably aiming to ‘spin’ potential reductions in military spending to gain political traction.  Domestically, it demonstrates that he is prudent about managing the economy, and that victory in Ukraine does not require endless increases in military spending. Internationally, this action is probably designed to send a similar message to the world, that Russia is winning and does not need to increase spending.  A message that plays to Trump’s assessment of Russia and the Ukraine War.

NATO Summit a mixed bag, but mostly good for Ukraine

Ukraine was not a key topic of discussion at the NATO Summit, and was pushed down the agenda by the US. However, Ukraine’s leader President Zelenskyy still attended and supported discussions.  The Guardian summarised the situation as follows “Concerns from earlier this year about whether Trump would reject NATO, withdraw US troops from Europe, abandon Ukraine and pursue a close relationship with Moscow have eased, though none have gone away. Ukraine’s president, Volodymyr Zelenskyy, is invited to the dinner, but not to a working meeting with NATO leaders, reflecting the softening US support for Kyiv, where fresh military aid has been halted under Trump.”

The summit did not provide the strong language of support that Ukraine and its allies want, like a pathway to NATO membership or an increase in sanctions against Russia. Regardless though, the summit delivered several blows for Russia. First, European nations confirmed their continued support, Newsweek reporting that “NATO members pledged to provide €40 billion in defense aid to Ukraine in 2025. According to reports, €35 billion in security assistance has already been supplied to Ukraine this year.”

Member countries also agreed to massively increase defence spending. The alliance agreed that by 2035 all members are expected to increase their defence spending to 5% of GDP.  But there are noteworthy details, 1.5% of each nation’s GDP based contribution is ‘ring-fenced’ for collective activities. This means that NATO will create a significant fund available for activities like; developing independent space capabilities, new digital communications networks, Airborne Early Warning and Command aircraft and other projects to fill capability gaps left by a US withdrawal.  

Another notable feature of the agreement is that aid to Ukraine can be recorded against the 5%. This incentivises nations to continue donating aid to Ukraine. But the key impact is likely to be in Europe where, stung by the Trump Whitehouse’s foreign policy decisions, NATO alliance members are keen to develop their own defence industries.  

NATO’s increase in defence spending will support Ukraine by providing another source for weapons and equipment. NATO defence industries already work closely with Ukraine, and this increase in defence spending will accelerate integration between these parties. NATO Secretary General, Mark Rutte stating that “We have made clear in the communique that defence-spending commitments through 2035 are intrinsically linked to Ukraine’s security needs, ensuring Kyiv remains in the fight for a durable and lasting peace,” 

Where does this leave the war?

In the air

The air war continues at pace, both sides increasing the severity of their strikes. Russian missiles and drones continue to hammer Ukraine’s cities and civil infrastructure. Ukraine continues to strike deeper and more effectively into the Russian hinterland.  In recent days Ukraine managed to attack the Kupol Factory in Izhevsk, 1,300 km north-east of the Ukrainian border.  Kupol produces sophisticated drones and air defence weapons. 

In another effective attack on 27 July Ukrainian drones attacked Kirovske airfield in Crimea, destroying helicopters and an advanced air defence system.  The key point is that the air war is not slowing down, and both sides are escalating their attacks and becoming more effective. 

On the ground

The immediate impact of the US cancellation of some military aid is an immediate increase in Russian offensive activity.  Russian forces attacking strongly in two locations; Sumy in the north, and Dontesk in the east.  At operational-level, Russia is trying to turn Ukraine’s flank by forcing it to choose between to widely located axes of advance.  

Russia’s ‘main effort’ is in Donetsk, its forces pushing forwards trying capture the key logistics hubs that provide the transport network to support an advance on the two large cities; Sloviansk and Kramatorsk.  The two logistics hubs Russia wants to capture are Kostyantynivka and Pokrovsk, both have been under siege for more than a year and Russia has failed to capture them.

A feature of the war is that towns and other urban areas are key terrain providing a mix of easily defensible terrain, and roads for resupply. Therefore, at tactical-level controlling towns is vitally important.  In Donetsk, Russia continues trying to envelop Kostyantynivka and Pokrovsk but at this stage remains unsuccessful. 

Fighting around Toretsk is an example of how a village or small town becomes a hub for offensive operations. Russian troops using Toretsk as a base to continue trying to envelop Kostyantynivka from the south.  The remains of buildings providing concealment and the local road network allowing supplies to be move forwards. 

Meanwhile, in the north, Russia is threatening Sumy trying to draw Ukrainian forces away from the ‘main effort’ in Donetsk.  Sumy is a turning movement, designed to threaten Ukraine’s left flank and draw defenders away from the battle in Donetsk.  

Russia is also persistently reinforcing its position on the west bank of the Oskil River. Probably, aiming to claim conquest of the whole of Luhansk Oblast, and develop a base for future operations.  

Conclusion 

Currently, the war is hard to judge because neither side appears to have an advantage that could translate into a decisive victory.  Ukraine and Russia both appear to be ‘holding on’ rather than being able to create the conditions for victory. 

At this stage, my assessment is that Russia has more to lose from this stasis than Ukraine.  Russia’s economic cracks are starting to show and, on the frontline, it is not making the progress it needs to finish the war quickly. Most importantly, its leadership remains committed to maximalist aims like; regime change, disarming Ukraine and ensuring it does not join NATO. 

Achieving these goals requires a total defeat of Ukraine, and Russia is no where near this objective.  Even if Russia suddenly took Sumy, Sloviansk and Kramatorsk they would still not be close to achieving these goals.  The maximalist approach commits Russia to slowly but surely burning through soldiers and equipment with little or no chance of achieving its strategic goals.  I do not know why Russia persists with this approach because it seems to invite eventual defeat. 

Ukraine on the other hand, is winning by surviving and all it needs to do to win is to outlast Russia.  And, Russia’s economic troubles and lack of progress on the ground indicate that Ukraine can prevail.

Ben Morgan is a bored Gen Xer, a former Officer in NZDF and TDBs Military Blogger – his work is on substack