President Vladimir Putin warned that key industrial sectors are facing major slowdowns even as he highlighted signs of economic strength, underlining the challenges the Kremlin faces as the impact deepens of international sanctions imposed after Russia invaded Ukraine.
Defense Minister Sergei Shoigu said that Russian forces have “liberated” 97% of the territory of Luhansk, one of two regions that make up the Donbas, the focus of Putin’s war aims in Ukraine. Chancellor Olaf Scholz said on a visit to Vilnius that Germany is prepared to deploy more troops in the Baltics as part of NATO’s plans to shore up its eastern flank.
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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.
Ukrainian President Volodymyr Zelenskiy said on 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 on Tuesday 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 of Ukraine 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. Cabinet minister Nadhim Zahawi said on Monday that Zelenskiy would be “punching the air” following Johnson’s narrow win in the confidence vote.
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 in Ukraine 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.
Kingspan to Invest 200 Million Euros in Ukraine Tech Plant (11:21 a.m.)
Irish building materials firm Kingspan Group Plc is investing 200 million euros ($214 million) in a building technology campus in Ukraine following its withdrawal from the Russian market. The move is a rare signal of investment confidence in Ukraine and its government since the invasion.
The facility will make insulation and heating products to help meet the demand for energy efficient buildings and create over 600 jobs, the company said in a statement.
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.
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.
Separatist Leader Confirms Russian General’s Death (9:01 a.m.)
Denis Pushilin, who heads the self-declared Donetsk People’s Republic, confirmed Russian Major General Roman Kutuzov’s death. It was first reported over the weekend by a journalist who works for state-run Russian media.
Russian forces have lost a number of senior commanders during the war. The army doesn’t regularly disclose military deaths and last reported casualty figures in late March, when it said 1,351 soldiers had died. Ukraine says about 30,000 Russians have been killed and the UK estimates about half that number.
Russia May Classify International Reserves Data (6:45 a.m.)
The Russian Economy Ministry drafted anti-sanction amendments to legislation on financial markets, RBC reported, citing a copy of bill, which it said was approved by a governmental commission on Monday.
The amendments allow for classifying data on Russia’s gold and foreign currency reserves. In April, central bank Governor Elvira Nabiullina said sanctions cut off access to half of Russian reserves.
Other proposals in the measure would include the cancellation of a cross-default provision on eurobonds and allowing companies to issue “substitute” bonds to repay eurobonds, it said.
Ukraine May Need $8 Billion in Gas Imports (11:15 p.m.)
Ukraine will need to import as much as $8 billion-worth of natural gas for the next heating season, Naftogaz CEO Yuriy Vitrenko said on Bloomberg TV.
Ukraine is in talks with the US on financing for purchases of liquefied natural gas, which could replace the pipeline gas that the country has been buying from the European market, Vitrenko said.
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