Izvestia: Accession of new regions to Russia expected this week

The decision on the accession of the Donetsk and the Lugansk People’s Republics as well as the Zaporozhye and the Kherson Regions to Russia may be made by the end of this week, politicians told Izvestia.

The LPR’s Ambassador to Moscow, Rodion Miroshnik, told the newspaper that the referendum was considered valid in his republic with voter turnout exceeding 50%, and now it should wait for the final results of the plebiscite. "The observers have not reported any violations that could affect the vote. This is a significant factor that shows that we are strictly adhering to international norms," he said.

However, Kiev has been shelling the liberated areas and the Donbass republics in an attempt to disrupt the referendums. The situation is tense in the liberated areas of the Zaporozhye and the Kherson Regions and in the LPR. "To a certain extent, this is because of the voting, because sometimes polling stations come under attack," Miroshnik explained. The military have been taking all the necessary measures to ensure security, the diplomat assured.

Though residents of the four regions would like their fate to be determined as soon as possible, joining Russia may take some time. The LPR envoy said it would be necessary to count the votes and sum up the results of the referendums in all of the regions. The authorities will do their best to speed up the process which would culminate with an appeal to Russian President Vladimir Putin, Miroshnik pledged. According to him, the current election results show that the vast majority of voters are genuinely interested in this process, so officials will not procrastinate.

First Deputy Chairman of the Russian State Duma Committee on CIS Affairs Konstantin Zatulin told Izvestia that arrangements for a meeting with Putin were currently underway in both houses of Russia’s parliament. "If [people say] `no,’ they will not join Russia, and if there is a `yes,’ they will obviously be admitted. Most likely, that will happen this week," the lawmaker emphasized.

He was echoed by Director of the Institute for Peacekeeping Initiatives and Conflictology Denis Denisov who said there was no reason whatsoever to postpone the process for months.

 

Vedomosti: Russia’s top brass wants to use volunteer servicemen as peacekeepers

The Russian Defense Ministry has proposed to amend the law on the participation of Russian military and civilian personnel in international peacekeeping efforts. Under the amendments, the country’s peacekeeping missions would hire volunteers who have undergone special training. The law stipulates that such servicemen should be contract soldiers. The law, as the text reads, should be backdated to August 15.

Vedomosti has asked the Defense Ministry to comment on the issue.

"The special military operation will end one day. And as soon as the DPR, the LPR and the Zaporozhye and the Kherson Regions join Russia, peacekeepers may be deployed along the line of engagement," military expert Viktor Litovkin told the paper. He recalled that decisions to send a peacekeeping mission are traditionally made by the United Nations Security Council, the Organization for Security and Cooperation in Europe (OSCE) or any other international organizations, while any unilateral deployment is ruled out.

In the context of international tensions and the need to increase the number of Russian military personnel, it is impossible to stay within the same framework that existed before February 24, 2022, said Director of the Moscow Center for Analysis of Strategies and Technologies Ruslan Pukhov. Peacekeeping operations in Karabakh-like areas could be a priority for Russia, the expert said. "Given the shift in priorities, Russia will become less involved in peacekeeping missions in" countries outside the former Soviet Union, he added.

The amendments may be applicable to most Russian servicemen in the military operation in Ukraine, Director of the Russian International Affairs Council (RIAC) Andrey Kortunov assumes. "This would perhaps involve expanding the category of those who can be involved in peacekeeping operations in other post-Soviet regions," he said. According to Kortunov, roles in peacekeeping missions are quite specific jobs that require people to be highly qualified. "At least, we are talking about UN peacekeeping missions for which people undergo special training for quite a long time," he said. Russian peacekeepers could be deployed to the border between Kyrgyzstan and Tajikistan, he believes.

 

Izvestia: Germany unlikely to replace Russian gas with LNG, experts say

Germany will need at least 11 LNG terminals and many years to wean itself off of Russian natural gas, German lawmakers told Izvestia, while adding that attempts to increase liquified natural gas supplies from the Middle East are unlikely to save the country from the energy crisis.

Over the past year, Berlin has launched operations to commission six LNG terminals, while the country had none before. Germany continues to struggle finding alternative suppliers. Back in the spring, Economy Minister Robert Habeck pledged that the country would be buying gas from Qatar to reduce its dependence on Russia, but he failed to sign any long-term contract during his visit to Doha in March.

Chancellor Olaf Scholz’s recent Mideastern tour was equally disappointing. Between September 24 and 25, the German leader managed to negotiate a contract to buy LNG from the UAE. Under the terms of the contract, Abu Dhabi’s national oil company ADNOC will supply 137,000 cubic meters of LNG. Following his talks in Qatar, Scholz said that Germany would be seeking "more progress" on its LNG imports.

LNG supplies can be expected, at best, years from now. Besides, other countries have long-term contracts with Qatar. Steffen Kotre from the Alternative for Germany faction told Izvestia diversifying gas deliveries was a good idea, and yet his country had reached a dead end in its policy of sanctions against Russia. According to Kotre, Germany will need to build at least 11 LNG terminals to completely replace Russian gas. "The reality is that more than just a buffer will be needed. It will take years to build decent infrastructure," he warned. The German lawmaker also said Germany’s ban on Russian gas would have severe social and economic costs in the short and mid-term.

Senior Researcher at the Institute of World Economy and International Relations Alexander Kamkin told Izvestia that though LNG has been a fast-evolving topic amid the energy crisis, that was not a cure-all. According to him, before February 2022, the United States exported around 2% of its LNG to Germany and has since increased the volume to about 6%. However, this surge cannot rival the 40% of Russian LNG Germany used to receive, and UAE exports would not allow Germany to avoid austerity measures anyway, he added.

 

Kommersant: Dollar gains against every currency except for Russia’s ruble

The US dollar has reached a new 20-year high globally. The dollar has been strengthening amid fears of a global recession in light of the Federal Reserve’s plans to take its interest rate up to where it was before the 2008 crisis. Meanwhile, the dollar has risen nominally in Russia, where the "toxic" unfriendly currencies are no longer in great demand, while the supply has been high thanks to a surplus on the country’s current balance.

The US currency has been rising amid the Fed’s tightening. Last week, the US regulator delivered an expected hike of 0.75 percentage points to 3-3.25%, and downgraded its economy and inflation forecasts for 2022-2023. It also sounded more hawkish on its future monetary policy path.

The Fed’s tightening makes a more severe recession in the US and globally more likely. "This will negatively affect all risk assets, including oil, gas and other commodities," Sovcombank Chief Analyst Mikhail Vasilyev told Kommersant. "In times of global instability, investors around the world tend to redirect their foreign exchange into the dollar and such safe assets as US treasuries," chief analyst at Zenit Bank Vladimir Yevstifeyev told the newspaper.

Analysts do not rule out a further rise in the dollar globally amid the Fed’s tightening. However, if a global recession occurs and Western sanctions bite more, there would still be a surplus on Russia’s current balance in the next few months and years, Vasilyev argues. This, together with several restrictions on the capital, should keep the ruble stable. According to his forecast, the dollar could slide to 55 rubles in weeks.

 

Kommersant: Europe may impose further restrictions on Russian steel imports

The European Union is mulling over additional restrictions on the import of Russian steel products, however, it has not specified which products would be banned. If Russian steel slabs are sanctioned, this would likely hit Europe harder, whose steel industry is already suffering from soaring energy prices and decarbonization costs. Meanwhile, Russian steelmakers may redirect their steel slabs to other markets. Experts warn the Europeans will have to buy semi-finished products at a significant premium elsewhere or restart their own expensive production, if Russian steel slabs disappear from the market.

The sanctions have not so far circumvented Russian steel slabs, and Russia remains a major supplier of those. According to June calculations by BCS, Russian steelmakers control a quarter of the global export of semi-finished products. Among major Russian suppliers, Mechel and Evraz are least exposed to geopolitical risks, as those have been focusing on the Far East as well as the Middle East and Northern Africa. Severstal has depended on the European market most. The company is under EU sanctions and on the US SDN-list, and has been unable to export slabs to those markets. And the potential ban could affect NLMK, which has five rolling mills in Europe.

"The hike in energy prices has forced 10% of European steel companies to close," Boris Krasnozhenov at Alfa-Bank told Kommersant. "Steel prices will soar higher in Europe, if there is a ban on Russian supplies of semi-finished products," he warned, for the market of steel slabs is very narrow.

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