Press review: Ukraine’s Kerch Strait provocation fails and Kiev picks new Normandy envoy

Izvestia: Ukrainian Kerch Strait provocation ends in failure

The Russian Federal Security Service (FSB) said it has irrefutable evidence that a provocation was staged by Kiev in the Black Sea. On the morning of November 25, three Ukrainian Navy ships illegally crossed the Russian border in the Kerch Strait area, violating international maritime law. The vessels that invaded the territorial waters of Russia have been detained, according to the FSB. Armed force was used in order to compel the ships to stop. In this case, the Russian side had every reason to provide such a response, military experts told Izvestia. To prevent repeated provocations in the region, unmanned aerial vehicles will be patrolling the state border, several sources in the Russian Defense Ministry told the newspaper.

The Orlan-10 and Outpost drones (UAVs) have already been deployed to guard the maritime border around the Kerch Strait and monitor the situation, several sources in the Russian military told Izvestia. The UAVs belonging to the Black Sea Fleet and the Aerospace Force will operate in both the Black and Azov Seas. The drones are equipped with the latest optical-electronic and radio systems.

In accordance with international maritime law, Ukrainian ships may conduct peaceful passages through the territorial sea of Russia, but their passage must be continuous and quick. In addition, any maneuvers, exercises with weapons of any kind and the collection of information are prohibited, Chief Researcher of the Institute of State and Law of the Russian Academy of Sciences Kamil Bekyashev told Izvestia. "I see in their actions a violation of international maritime law, since they did not fulfill the requirements of a peaceful passage. In this situation, Russia had every right to use force. And in the event that shots are fired from the Ukrainian side, Russian border guards and sailors can immediately destroy the violators," he said.

According to Deputy Head of the Federation Council’s Committee on Defense and Security Franz Klintsevich, the provocation was initially designed for a harsh response. So now, everything depends on our reaction. Tough diplomatic warnings are needed, but we must be careful concerning action," the senator said.

"The provocation had been in the works for a long time, and this is not the last round of escalating confrontation in Russian-Ukrainian relations," Permanent Representative of the Republic of Crimea under the President of the Russian Federation Georgy Muradov told Izvestia. The presidential elections in Ukraine are approaching and the positions of the current head of state, Pyotr Poroshenko, are rather weak, he noted.

Nezavisimaya Gazeta: Kiev won't change position on Donbass

This week, representatives of the Normandy Quartet will meet again in Berlin. At the moment, negotiations between top diplomats and state leaders are not planned. According to Nezavisimaya Gazeta, during this timeout, which may last until the end of the Ukrainian elections, there is only one trilateral meeting in Minsk. That being said, President Pyotr Poroshenko recently appointed Evgeny Marchuk to head the Kiev delegation. The appointee earlier worked in the security subgroup.

According to the newspaper, Marchuk had earlier criticized the existing negotiation formats, but noted that others do not exist. A source told Nezavisimaya Gazeta that Marchuk recommended that the Ukrainian authorities find a way to pull in the United States and the United Kingdom to the Normandy Four negotiations.

Poroshenko's decision to appoint Marchuk to head the Ukrainian delegation in Minsk specifies that the new leader will work 'pro-bono basis', the newspaper wrote. "The lack of official status provides the opportunity for maneuvering. This is very important, because our parliamentarians in the tripartite group will be in contact with representatives of the self-proclaimed and unrecognized republics," political analyst Vadimir Fesenko said.

A source told Nezavisimaya Gazeta that the lack of official status would not prevent Marchuk from negotiating. "What is much more important is whether the new position means that the Ukrainian authorities will pay more attention to his opinion. For example, in 2014, Marchuk criticized the idea of abandoning the Geneva format with the participation of the United States in favor of the Normandy format," the source said.

Russian President Vladimir Putin said earlier that it was meaningless to negotiate a settlement during the Ukrainian election campaign. He noted that the current Ukrainian government has not yet implemented the political portion of the Minsk agreements. Meanwhile, military experts in Kiev told the newspaper that from a political point of view, the parties now need to avoid any exacerbation and new points of contention.

Nezavisimaya Gazeta: White House uses Khashoggi murder as trump card to lower oil prices

US President Donald Trump has a major ace in the hole for managing global oil prices, and that is employing the threat of personal sanctions against the crown prince for the murder of opposition journalist Khashoggi. This has turned Riyadh into an obedient oil producer, which increases production, despite a decline in global prices, Nezavisimaya Gazeta wrote. A new alignment of forces in the oil market might be set on December 5-6 at the meeting of OPEC+ nations. At the conference, oil exporters might also agree to reduce production in an attempt to restrain the growth of a surplus in raw materials.

The leadership of Saudi Arabia has been pushed into a corner, experts told the newspaper. "On the one hand, the accusations of murdering an opposition journalist. On the other hand, the country's leadership requires relatively high oil prices of at least $70- $75 per barrel to maintain a balanced national budget. Most likely, the second factor has more weight for the country's elite than the first, and the Saudis will seek to reduce the world's oil supply," Associate Professor at the Plekhanov Russian University of Economics Sergey Ermolaev told Nezavisimaya Gazeta.

Managing Partner of Veta expert group Ilya Zharsky does not see the possibility of any sanctions against Riyadh since they would hurt Washington even more. "Saudi Arabia exports 7.7 mln barrels per day, so even the slightest hint of any serious intentions to impose restrictions on Riyadh might launch the price per barrel to nearly $90 or more," Zharsky told the newspaper.

"Most likely, the new OPEC+ agreement will secure a return to the levels in 2016. Moreover, an additional 1 mln barrels per day will once again be withdrawn. By the same token, neither Russia nor other countries participating in the deal will reduce production volumes. So, Riyadh will reduce them at its own expense. This is the price of a compromise and preserving agreements with Moscow and Washington simultaneously," the economist told Nezavisimaya Gazeta.

Kommersant: Price tag for new tunnel along Baikal–Amur railway line may come to $3.9 bln

The cost of constructing the second Severomuysky tunnel on the Baikal-Amur Mainline (BAM) could amount to 260.79 bln rubles ($3.9 bln), Kommersant wrote citing the project’s feasibility study prepared by the Institute for Economy and Transport Development.

The capacity of the Severomuysky tunnel at the moment is 16 pairs of trains per day. According to the newspaper, the construction of a new section under the feasibility study will increase the number of trains to 34 pairs per day. However, to achieve such figures, intervals between trains would not exceed 10 minutes, the authors of the feasibility study wrote.

Russian Railways CEO Oleg Belozerov said that the construction of the second Severomuysky tunnel would increase the carrying capacity from 16 mln to 100 mln tonnes of cargo, noting that with the current technology, the construction of the 15-km tunnel will take "around 10 years."

The Severomuysky tunnel of the Baikal-Amur Mainline was opened in December 2003 in Buryatia. This is Russia’s longest railway tunnel (15.3 km) and it makes it possible for non-stop movement of heavy freight trains through BAM.

Kommersant: Private cryptocurrency mining loses luster

The collapse of prices for basic cryptocurrencies led to a decline in its mining business. This is noticeable in both the industrial and private sectors, Kommersant wrote. At the same time, experts told the newspaper that mining as a sector is declining due to the development of new technologies. In the near future, small companies and private miners are likely to leave the market completely, giving way to large organizations that have the resources for technological and market restructuring of the business.

For the first time since September 2017, the cost of bitcoin on the night of November 25 plunged below $4,000. According to the Coinmarketcap, bitcoin later fell by 10.17% to $3,879. Thus, since the beginning of the year, the capitalization of the global cryptocurrency market more than halved from $370 bln to $140 bln.

According to Kommersant, experts noted that cryptocurrency mining is directly related to the general state of the crypto market. According to Andrey Grachev, Head of the Russian branch of cryptocurrency exchange Huobi, Bitmain (holder of the two largest mining pools controlling half of the Bitcoin network) recently released a new Antminer S15miner, which costs almost four times more than the previous model. Given the current market realities, the payback period for this device is 700-800 days, which is a very long time. Therefore, only businesses or professional long-term investors can afford mining. "But given the current situation, it is a risky undertaking even for such an investor," Grachev told the newspaper.

According to Head of Enigma, co-founder of the ICG cryptocurrency fund, Igor Zartdinov, "home miners as a class are gradually disappearing," because it cannot withstand competition from large companies. This is true for small market participants. Mining in its current form is an interim solution, small companies will leave the market, and large ones will adapt to the development of technology, Kommersant wrote.

TASS is not responsible for the material quoted in the press review