US official warns Russia over Nord Stream 2: Ukraine update

US army reinforcements have arrived in Europe.
Members of the Ukrainian forces participate in an urban combat training exercise, organised by the Ukraine Ministry of Internal Affairs, within the exclusion zone in the abandoned city of Pripyat, Ukraine, on Friday, Feb. 4, 2022. Russia denies any plans to invade Ukraine, saying the forces are on routine maneuvers, but it has warned Kyiv against making any military move against the separatist regions Moscow backs in the Donbas area. Image: Bloomberg

U.S. Army reinforcements arrived in Europe, and French President Emmanuel Macron held talks on unity among North Atlantic Treaty Organization countries, continuing his active diplomacy.

Ukraine’s defense minister said the probability of an escalation by Russia still looks low, while an official close to President Vlodymyr Zelenskiy said the West should specify potential sanctions.

Moscow has repeatedly denied that it plans to attack Ukraine, while the U.K. and U.S. say Russia has massed almost 130,000 troops close to the border. Russia has decried the use of NATO forces near its borders.

Key developments

  • Putin’s Financial Fortress Blunts Impact of Threatened Sanctions
  • Putin Courts China’s Xi for Help in Showdown With the West
  • Ukraine May Help Shore Up Its Market With Debt Buybacks
  • What we know so far about potential U.S.-EU sanctions on Russia
  • Where military forces are assembling around Russia and Ukraine

All times converted to SA time

Ukraine Official Suggests Proactive Sanctions (7:06 p.m.) 
A senior Ukrainian official says the West should outline a package of potential sanctions against Russia now if they consider the threat of escalation to be real.

European nations have been cautious about using sanctions as a deterrent to a potential Russian incursion into Ukraine that Moscow has repeatedly denied.

Mykhailo Podolyak, adviser to President Vlodymyr Zelenskiy’s chief of staff, told Bloomberg News that “sanctions to deter Russia are already needed,” and that support for Ukraine’s “economic stability” should go hand-in-hand with military aid and active diplomacy.

U.S. Warns Nord Stream 2 Is on the Line (4:55 p.m.) 
U.S. National Security Adviser Jake Sullivan expressed confidence that the Nord Stream 2 pipeline will never begin pumping natural gas from Russia to Germany should Russian forces invade Ukraine.

“We will follow through on the clear and definitive statement we have made as the Biden administration — one way or the other, if Russia invades Ukraine, Nord Stream 2 will not move forward,” Sullivan said on “Fox News Sunday.”

Sullivan reiterated on NBC’s “Meet the Press” that an incursion would lead to “the imposition of severe economic consequences,” while declining to describe any military action by President Vladimir Putin as imminent. Russia has denied that it plans to attack its neighbor.

Ukraine Ministry Downplays Escalation Prospects (4:06 p.m.) 
Ukrainian Defense Minister Oleksiy Reznikov said Sunday that “the probability of a significant escalation” by Russia “continues to be assessed as low.” Ukrainian intelligence are closely monitoring movements of Russian personnel along the shared border, in Belarus and Crimea, and in separatist-controlled areas, he said in a statement posted on the ministry’s website.

“There is an intense exchange of information with international partners,” Reznikov said. “At the moment, everything is happening within the framework of our estimates.”

Ukrainian soldiers are now training on equipment sent by Western allies, Reznilov added.

German Chancellor Under Pressure to Take Stand on Russia (8 a.m.)
German Chancellor Olaf Scholz, who heads to Washington Sunday for a meeting with President Joe Biden, is under increasing pressure to take a stand on Russia over its military buildup near Ukraine.

The extent of Scholz’s duress was made clear last week when a German newspaper wrote a headline, “Where is Scholz?” that questioned the chancellor’s engagement with the tensions over Russia’s military buildup on Ukraine’s border.

Scholz has stuck so far to talking points, namely that all options to impose retaliatory sanctions against Russia are on the table, but shipping weapons to help Ukraine defend itself are off.

Russian Official Calls U.S. Intelligence Assessments ‘Scaremongering’  (5 a.m.)
Ambassador Dmitry Polyanskiy, the deputy at the Russian Mission to the United Nations, said U.S. military and intelligence estimates on the impact of any potential Russian invasion of Ukraine are “madness and scaremongering.”

Polyanskiy responded on Twitter to a tweet on a lengthy Washington Post story that cited recent assessments to U.S. lawmakers and European allies that as many as 50,000 civilians would be killed and 5 million displaced in the event of a large-scale Russian invasion of Ukraine.

Macron Seeks to Ease Tensions in Putin Meeting (1:00 a.m.)
French President Emmanuel Macron plans to discuss de-escalating the situation in Ukraine with Vladimir Putin during a trip to Moscow on Monday.

“We have to be very realistic,” Macron told Le Journal du Dimanche newspaper. “We’re not going to get unilateral gestures, but it’s essential to avoid a deterioration of the situation before building reciprocal mechanisms and gestures of trust.”

Macron said Russia’s geopolitical goal was “to clarify the rules of cohabitation with NATO and the EU.”

U.S. Army Task Force Sets Up in Germany (7:26 p.m.)
About 300 newly deployed U.S. service members arrived in Germany and set up a joint task force within 24 hours of getting the call, according to an Army statement on Saturday. The forces from the 18th Airborne Corps out of Fort Bragg, North Carolina, were sent to Wiesbaden, near Frankfurt.

Army Major General Christopher Donahue, the commander of the 82nd Airborne Division, has arrived in Poland, where the Pentagon has said it’s deploying components of an infantry brigade combat team.

The corps’ presence “serves to bolster existing U.S. forces in Europe and demonstrates our commitment to our NATO allies and partners,” Captain Matt Visser, the unit’s spokesman, said in the statement.

© 2022 Bloomberg L.P.


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