A senior Russian official reiterated Russian President Vladimir Putin's insistence that negotiations with Ukraine must be based on the same uncompromising demands he made before the full-scale invasion and at the moment of Russia's greatest territorial gains, despite the fact that Ukraine has liberated significant amount of territory since then. Russian Federation Council Speaker Valentina Matviyenko stated on December 24 that Russia is open to compromise in negotiations with Ukraine, but that Russia will strictly adhere to the conditions that it laid out during negotiations in Istanbul in March 2022, when Russian troops were advancing on Kyiv and throughout eastern and southern Ukraine. Matviyenko added that Russia would not deviate from these conditions by "one iota." The partial agreement that emerged during the Ukraine-Russia negotiations in Istanbul in March 2022 stated that Ukraine would be a permanently neutral state that could not join NATO, and imposed limitations on the Ukrainian military similar to those imposed by the Treaty of Versailles on Germany after World War I, restricting Ukraine's Armed Forces to 85,000 soldiers. Russia's demands at Istanbul were mainly more detailed versions of the demands that Putin made in the months before he launched the full-scale invasion in February 2022, including Ukraine's "demilitarization" and neutrality. Matviyenko is reiterating Putin's demand from his annual Direct Line televised press conference on December 19, and more senior Russian officials are likely to make similar claims to domestic and foreign audiences in coming weeks. ISW continues to assess that senior Russian officials' references to conditions Putin attempted to impose on Ukraine when he believed his full-scale invasion could succeed in a few days in 2022 reflects his projected confidence that he can completely defeat Ukraine militarily despite the tremendous setbacks Ukraine has inflicted on Russian forces since then.
The Kremlin's economic limitations will likely hinder its efforts to impose policies combatting long-term demographic decline in Russia. Nizhny Novgorod Oblast Governor Gleb Nikitin stated on December 23 that Nizhny Novgorod Oblast would provide a maternity capital payment of one million rubles (about $10,000) for the birth of each child starting at an unspecified date in 2025. Nikitin stated that Nizhny Novogorod Oblast authorities would provide one million rubles for the first and second children with federal and regional funds and will provide one million rubles for the third and fourth children solely from the regional budget. Russian regional authorities will likely continue to expand maternity capital payments as part of a Kremlin directive to address long-term demographic issues. The Russian government may struggle to provide large maternity capital payments over time as the Russian economy is continually strained by its war in Ukraine, international sanctions, and rising labor shortages, however. Russian state newswire RIA Novosti reported on December 24 that it saw a letter that the Russian Central Bank sent in response to a request from Russian State Duma Deputy Denis Parfenov wherein the Central Bank stated that the lowering of the key interest rate in order to stimulate demand, when "demand already exceeds supply," is "dangerous." The Central Bank stated that Russia's current labor, equipment, and transport shortages mean that cheap loans will not immediately give producers additional resources and will only intensify competition for resources and increase prices. The Russian Central Bank raised the key interest rate to 21 percent in October 2024, and the bank's head, Elvira Nabiullina, has recently stated that the bank may raise it further. Russian President Vladimir Putin attempted during his Direct Line televised press conference on December 19 to portray the Russian economy as "stable and reliable," while also blaming the Russian Central Bank and Nabiullina for mishandling rising interest rates.
A Russian cargo ship sank in the Mediterranean Sea on December 23, possibly while traveling from St. Petersburg to Vladivostok via Syria and Libya. Spanish media reported on December 24 that the Russian Ursa Major cargo ship sank in the Mediterranean Sea between Spain and Algeria, and the Russian Ministry of Foreign Affairs (MFA) confirmed that the dry cargo ship sank after an explosion in the engine room. The Russian Ministry of Defense's (MoD) Oboronlogistika logistics company, which owns the Ursa Major, claimed in a press release from December 20 that the vessel was traveling to Vladivostok with two cranes necessary to expand the city's port terminal and 45-ton hatch covers for new icebreakers. Oboronlogistika claimed that the vessel was going to develop port infrastructure and the Northern Sea Route. Ship tracking services showed that the vessel left St. Petersburg on December 11. Russian media reported that the captain of the Ursa Major stated that the ship was carrying empty containers on board. The Maritime Executive reported that automatic identification system (AIS) data showed that the Russian cargo ship Sparta came to the aid of the Ursa Major following the explosion. Ukraine's Main Military Intelligence Directorate (GUR) recently stated that the Sparta and the Sparta II cargo ships were en route from Russia to the Port of Tartus to evacuate Russian military assets from Syria. The presence of the hatch covers for new icebreakers on the Ursa Major is consistent with Oboronlogistika's statement that the ship was travelling to Vladivostok. Russia may have diverted the ship to the Port of Tartus to evacuate Russian military assets from Syria. Russia has reportedly started moving military assets from Syria to Libya, and the Ursa Major may have planned to relocate military assets from Syria to Libya before continuing on to Vladivostok. The sinking of the Ursa Major may complicate and slow Russian efforts to evacuate military assets from the Port of Tartus.
The United States provided Ukraine on December 24 with the first tranche of loans generated solely from profits from frozen Russian assets. Ukrainian Prime Minister Denys Shmyhal stated that the United States gave Ukraine a one billion dollar loan generated solely from profits from frozen Russian assets. This is the first loan out of a total $20 billion generated from profits from frozen Russian assets that the United States allocated to Ukraine on December 10. The United States transfer of revenues from Russian frozen assets is part of the larger G7 Extraordinary Revenue Acceleration (ERA) Loans initiative to send $50 billion worth of profits from frozen Russian assets to support Ukraine's budgetary, military, and reconstruction assistance throughout 2025.
Key Takeaways:
- A senior Russian official reiterated Russian President Vladimir Putin's insistence that negotiations with Ukraine must be based on the same uncompromising demands he made before the full-scale invasion and at the moment of Russia's greatest territorial gains, despite the fact that Ukraine has liberated significant amount of territory since then.
- The Kremlin's economic limitations will likely hinder its efforts to impose policies combatting long-term demographic decline in Russia.
- A Russian cargo ship sank in the Mediterranean Sea on December 23, possibly while traveling from St. Petersburg to Vladivostok via Syria and Libya.
- The United States provided Ukraine on December 24 with the first tranche of loans generated solely from profits from frozen Russian assets.
- Russian forces recently advanced near Pokrovsk, Toretsk, Vuhledar, Velyka Novosilka, and in Kursk Oblast.
- Russian Security Council Deputy Chairperson Dmitry Medvedev claimed on December 24 that 440,000 recruits signed military service contracts with the Russian Ministry of Defense (MoD) in 2024.
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[ISW] 이란 업데이트, 2024년 12월 24일