Merkel warns on Putin; Kyiv wary of grain talks

Ukrainian President Volodymyr Zelenskiy reiterated calls for more weapons to strike back at invading forces.
Image: Aris Messinis/AFP/Getty Images

Former German Chancellor Angela Merkel made a tentative return to the public arena, saying President Vladimir Putin made a “big mistake” by invading Ukraine and warning that isolating Russia isn’t possible over the long term.

Russian Foreign Minister Sergei Lavrov arrived in Ankara for talks that may restart grain shipments out of Ukrainian ports on the Black Sea, while Kyiv is skeptical of the Kremlin’s intentions and seeking strong security guarantees that would allow it to export a key commodity.

Ukrainian President Volodymyr Zelenskiy reiterated calls for more weapons to strike back at invading forces, as Russian Defense Minister Sergei Shoigu said that Moscow’s military had occupied 97% of the territory of Luhansk, one of two regions comprising the Donbas that is the focus of Putin’s war aims.

Key Developments 

(All times in CET)

  • Russia Is in Topsy-Turvy World Where Belarus Tops German Exports
  • Merkel Warns of Isolating Russia After Putin’s ‘Big Mistake’
  • US Seeks $4.3 Billion for Nuclear Fuel to Wean Off Russia Supply
  • Ukraine’s $27 Million War Bond Sale Is the Weakest on Record
  • The US Is Now Sending the Bulk of Its Export Gas to Europe
  • US Treasury Prohibits Investors From Buying Russian Debt

Merkel Warns of Isolating Russia (5:00 a.m.)

Merkel said in an on-stage interview at a theater in central Berlin that “there’s no excuse for this brutal aggression.” While she has remained active behind the scenes, it was her first public appearance in front of a larger audience since leaving office in December.

Asked whether she had interacted with Putin, she dodged a direct response, saying she wouldn’t do anything that government didn’t ask her to do.

Merkel’s only other foray into the public sphere was in April to respond to criticism from Zelenskiy, who accused Merkel of being partly responsible for the invasion by preventing Ukraine’s NATO accession in 2008.

World Bank Approves $1.49 Billion for Ukraine (11:26 p.m.)

The new financing is part of a total support package of more than $4 billion that the World Bank is mobilizing.

Almost $2 billion of the funding has been disbursed, the World Bank said in a statement on its website. The money from the latest project will be used to pay for wages for government and social workers, it said.

Russian Oil Output Set to Dive in 2023, EIA Says (11:25 p.m.)

The European Union’s ban on seaborne imports of Russian oil will lead to an 18% drop in the country’s fuel output by the end of next year, according to the Energy Information Administration.

Production of liquid fuels will drop to 9.3 million barrels a day in the fourth quarter of 2023 from 11.3 million in the first quarter of this year, the US government agency said in a monthly report.

Russia Returns 210 Bodies of Ukrainian soldiers (9:46 p.m.)

Mariupol was devastated under Russia’s siege, which lasted almost three months. Azovstal, owned by Ukraine’s richest businessman, was the city’s last holdout of Ukrainian troops, who surrendered at the end of May. It’s unclear how many Ukrainian defenders were killed there, and Russia said it’s holding more than 2,000 prisoners after supplies of weapons, food and medicine were cut off.

Ukraine is working for the release of the prisoners, according to the intelligence statement.

Ukraine Says It Needs Strong Security Guarantees in Black Sea (7:10 p.m)

A Russian attack that destroyed a warehouse at a grain terminal in southern Ukraine over the weekend shows the need for guarantees that would be provided “by supplying Ukraine with weapons to protect its shores from naval threats and by involving navies of third parties to patrol certain water areas in the Black Sea,” the Foreign Ministry said in an emailed statement.

The ministry said Ukraine values Turkey’s efforts for an accord to permit food shipments but Ukraine’s interests must be protected.

Kuleba: No Deal on Unblocking Ports Without Ukraine (6 p.m.)

Ukrainian Foreign Minister Dmytro Kuleba reiterated that no agreement has been reached among Kyiv, Ankara and Moscow on unblocking grain exports from the Black Sea.

Ukraine is in talks with the UN and other partners over corridors for grain exports. Russian Foreign Minister Lavrov arrived in Ankara Tuesday for talks with Turkish counterpart Mevlut Cavusoglu, Russian news agency TASS reported.

Read More: Corn Futures Rise Amid Concerns About Black Sea Shipments

Zelenskiy: Ukraine Lacks Weapons for Counteroffensive (5:40 p.m.)

Ukrainian troops have slowed down their liberation of Russian-occupied territories as they lack fire-power and manpower, Zelenskiy said in an interview with the Financial Times, according to a transcript of his remarks provided by the president’s office.

Ukraine needs 10 times the amount of weapons and people to move forward with its counteroffensive, he said. Even so, Zelenskiy reiterated his country needs to defeat Russia on the battlefield. Having Russian troops pushed back to their Feb. 24 positions would only be a temporary victory as Ukraine has to regain control over all of its territories, he said.

“So far I don’t see a configuration which could force Russia to halt this war,” he said when asked about calls to negotiate a resolution.

US Says It Helped Moldova Reroute Stranded Apples (4:35 p.m.)

As disruptions from the war in Ukraine threaten a global food crisis, Samantha Power cited a success story involving apples from Moldova. Power, administrator of the US Agency for International Development, said that the agency helped Moldova export “tens of millions of dollars” in apples that were stuck in cold storage as a result of Russia’s war in Ukraine and blockade of Black Sea ports.

US Bars Investors from Buying Russia Debt (4:25 p.m.)

The US Treasury stepped up its financial sanctions on Russia, restricting investors from buying the country’s debt in the secondary market. The new guidance means US firms can hold or sell Russian debt, but can’t buy it, according to a spokesperson for Treasury’s Office of Foreign Assets Control.

Metinvest Requests Probe of Metal Theft (4 p.m.)

Ukrainian steelmaker Metinvest asked the Prosecutor General’s Office to start criminal proceedings into the suspected theft of its metal products in Mariupol by Russian forces, Interfax reported. Metinvest’s Azovstal and Ilyich Iron and Steel Works said property was misappropriated at both plants and shipped in unknown directions, the news service said, citing companies’ requests filed with prosecutors.

Russia Claims Military Advances (2:45 p.m.) 

Speaking during a televised Defense Ministry meeting, Shoigu highlighted advances in Luhansk, adding that Russian forces have also taken control of the residential areas of Sievierodonetsk and are now storming the industrial area.

Zelenskiy said Monday that “the most dangerous situation” of the war was in Zaporizhzhia, a region west of Donetsk partly occupied by Russian forces. He added that Ukrainian forces were still fighting in Sievierodonetsk, although they are outnumbered by Russian personnel and heavy weapons.

Putin Warns on Economy Outlook, Cites Successes (1:30 p.m.)

Putin singled out the auto sector, where nearly all car plants have shut for lack of imported components, and said industries like steel face “risks of substantial reduction in output in the medium term.” At the same time, he touted record-low unemployment and the ruble’s strength as positive signs.

In a televised meeting with officials, Putin called on the government to provide more assistance to companies and consumers, though he didn’t announce any new spending. He didn’t specifically mention sanctions imposed by the US and its allies, referring only to “today’s difficulties caused by a series of circumstances that we won’t get into the details of.”

Russia is facing one of the deepest downturns in years, according to official forecasts, as sanctions cut off access to key markets and components and have triggered an exodus of foreign companies.

Johnson: Ukraine Shouldn’t Be Pressured Into ‘Bad Peace’ (1:20 p.m.)

UK Prime Minister Boris Johnson, fresh from surviving a vote of no confidence, told ministers at a cabinet meeting that it was “vital” Zelenskiy wasn’t “pressured into accepting a bad peace.” Asked by reporters whether the remark was a dig at recent comments by French President Emmanuel Macron, Johnson’s spokesman Max Blain said the prime minister had no specific person in mind.

Russia’s invasion has played a major part in the fortunes of Johnson, who often presents the UK’s response as reason for rebels in his ruling Conservative Party not to try to oust him.

Ukraine Sees No Immediate Fresh Attacks From North (12:51 p.m.)

Ukraine sees no signs that Russia’s troops are poised to resume their invasion from the north, although it retains three battalion tactical groups, or about 2,000 soldiers, near its southern border with Ukraine, according to the Ukrainian Military Staff.

Russian forces meanwhile retreated from parts of Vasylivka south of the city of Zaporizhzhia in the direction of Kherson, governor Oleksandr Starukh said on national television. And Russian forces pulled back from most road checkpoints around Melitopol, the city’s mayor Ivan Fedorov said on Facebook.

Scholz Says Germany Prepared to Reinforce Baltics (12:30 p.m.)

“We are prepared to strengthen our engagement toward a robust fighting brigade,” Scholz said in Vilnius after a meeting with leaders from Lithuania, Latvia and Estonia.

The three countries want the alliance’s battalion groups to be increased to brigade-size units of roughly 5,000 troops. This together with local troops would give it division-level strength in each of the Baltic countries. NATO’s enhanced Forward Presence Battalion Group in Lithuania is now led by Germany, which currently has some 500 soldiers on the ground there.

Turkey Says Finland, Sweden in NATO Is ‘Not a Right’ (12:21 p.m.)

Finland and Sweden’s NATO membership is an “issue of principle” for Turkey, said Fahrettin Altun, communications director of President Recep Tayyip Erdogan. Speaking in Ankara, Altun said Turkey expects “concrete steps against terrorism” from the two nations, adding, “NATO membership is not a right but a privilege.”

Speaking separately in Helsinki, Finnish Foreign Minister Pekka Haavisto called on NATO to confirm “that they have the mechanism for taking new members” and said the bloc’s summit in Madrid at the end of June “is a very crucial point where they have to take stock of where we are in the process of Finnish and Swedish application.”

Ukraine’s River Ports Take Lead as Main Food Export Route (11:40 a.m.)

Most of Ukraine’s agriculture commodities were exported through river ports last month, making them “main export gate” for one of the biggest global suppliers of food, which is struggling to restore its shipments to foreign markets amid the war with Russia.

The country boosted its exports of grains, oilseeds and refinery products by 80% from the previous month in May, with 47% of overall shipments going via river ports and ferries, while in April the most popular way to ship was by rail, according to Ukraine’s Agriculture Ministry.

Russian Forces Intensify Attacks in North, East of Ukraine (10:13 a.m.)

Russia is continuing its offensive near Izyum in the Kharkiv region and Slovyansk in the north of Donetsk region, according to the General Staff of the Ukrainian army. “Reports of heavy shelling near Izyum suggests Russia is preparing to make a renewed effort in the northern axis,” the UK Ministry of Defense said in its latest intelligence update on Twitter.

OKHTYRKA, UKRAINE

Russian forces also intensified attacks in nearby Sumy region in northeastern Ukraine. Around 40 mortar and artillery projectiles were fired Monday evening on several villages in Sumy region near the Russian border, governor Dmytro Zhyvytskyy said on Telegram. Mortar and artillery fire continued Tuesday morning, he said.

© 2022 Bloomberg

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Russia can control the intensity of this for years to come and’s its possible expansion. The more Zelensky hangs out for a ‘win’, whatever that means and probably at the behest of the US and UK, the worse it gets for Ukrainians and Ukraine.

It is time for him to get around a table and negotiate a settlement.

You don’t negotiate with terrorists – which is what putin is.

Putin must get out of democratic Ukraine.

Putin must pay for the damage to Ukraine.

If he doesn’t the rest of the world will sanction russia back into the stone age. If China and India continue to break sanctions to buy $35 discounted oil then they too must get slapped with tariffs on their exports and those proceeds used to repair Ukraine.

Putin in any event is not controlling this war, this invasion has shown that his army cannot fight a NATO nation never mind the whole of NATO

Putin is not trying to beat NATO. He does not have to anyway. He holds the Joker in the form of his nuclear arsenal. This is a low-scale war of attrition. He only has to fire some long-range artillery every now and then. He has to feed the soldiers anyway.

He knows from experience that US and European voters can’t stomach a drawn-out war. They can’t even tolerate sending their soldiers to Ukraine for one day. NATO is a weak and disorganized puppet of the USA, and a front for its imperialist ambitions. Putin is playing the long game. He has the public support, finances, and the military to back him. Nobody can bankrupt the nation that holds the key to the largest exports of grains and commodities.

Ukrainian forces are retreating and getting captured, even while the Western media tells us that they are winning.

The loss of life and destruction of property is a shameful disaster. All the parties to this war, like in all wars, are killing innocent people for economic reasons. Prostitution is an honorable profession relative to international politics.

I wonder if anyone can explain in simple, logical terms what benefits there are for Russia in invading Ukraine, when the economic benefits of NOT invading and expanding good economic relationships in tourism, international social connections, exports of oil, gas, gemstones, minerals, raising funds in international bonds with the plusses to their citizens of a more comfortable lifestyle are so obvious?

Please don’t tell me that the West was planning to invade Russia and this was a preemptive strike.

The West never planned to invade Russia and I am not aware that anybody made such a statement.

“The first casualty of war is truth” – therefore, there are many perspectives and narratives. We cannot trust the statements made by any party to this war. Each participant has his own propaganda machine that tries to win the popular opinion. People in the West trust western media and the Chinese and Russians trust their media. Intelligent, well-educated, and knowledgeable individuals hold opposing viewpoints on this matter.

The individual who tries to form an objective opinion should ignore all biased and emotional media reports. It is like building a puzzle upside down. Answering the question is the easy part. Understanding the answer is the hard part.

Without a thorough understanding of what money is, and how the monetary system works, it is impossible to understand the reason for the war.

So if Putin was living a happy, successful life within the borders of Russia, with a happy successful population, why destroy it all by invading a country that poses absolutely no threat to the success and existence of Russia?

Beachcomber, the way I see it, and there is quite a large crowd that shares my opinion, Russia is reacting in a proactive way to a real threat to its national security. Ukraine poses no threat to Russia at all. Just like Iraq and Libya posed no threat to the USA at all. The war in Ukraine is a proxy war. Purin is merely using Ukraine as a battleground against the USA, like the USA is using Ukraine as a battleground against Russia.

Keep in mind that Russia owns the largest proven mineral reserves in the world and that the USA has a virtual monopoly in the issuance of the reserve currency that is used for more than 80% of commodity transactions. This, in essence, is the war. (IMHO)

The short answer to your question is this – the war in Ukraine is merely another link in a long chain that ties all major commodity producers to the Bretton Woods agreement.

What is the most important characteristic of a Fiat currency system? What determines the value of the currency? Why do people use it when it is nothing more than bouncing cheques, or promises to pay without any backing? It is backed by debt they say. That is like a bankrupt person writing out cheques. His promises to pay are also backed by debt.

A Fiat currency has value because the government says so. It is money “by decree”. The government has to ensure the acceptance of worthless money by force. The size and proficiency of the police and the army determine the extent to which the currency is accepted as payment. That is why the nation that issues the reserve currency of the world will always have the largest military force in the world, and they will only be able to occupy that position while they have military superiority. The hegemon will, and has to, use its military to “persuade” delinquent resource producers to accept its fake currency in exchange for real resources.

That, IMHO, is the simplest and only logical explanation for the war in Ukraine.

End of comments.

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