Nikolaev Governor Vitaly Kim has said Ukrainians are too “exhausted” to prioritize old borders over a ceasefire
Ukraine should agree to a peace deal with Russia that prioritizes people over territory, Ukrainian leader Vladimir Zelensky’s ally Vitaly Kim has said.
Kim, who led a local branch of Zelensky’s Servant of the People party during the 2019 presidential election, is the governor of Nikolaev Region, west of Kherson Region.
He rose to prominence in the early months of the war, when the front line ran near Nikolaev, a Black Sea port and major shipbuilding center.
“The land is important, but still, people are more important and the situation is that we do not know what will be tomorrow,” Kim told The Independent in an interview published Monday.
He said Ukrainians are increasingly exhausted by a conflict that is on track to enter its fifth year this month, and that restoring the country’s 1991 borders is not on the minds of ordinary people.
“So for the Ukrainian people, I think the victory is just stopping the war and some guarantees of security for the future,” Kim said. “It is very important for us because a lot of time has passed.”
“We are exhausted and first, it’s not about weapons, it’s not about missiles, it’s about people. We’ve only 40 million people and everybody is exhausted. Our soldiers cannot fight for four to 10 years,” the governor said.
Zelensky has ruled out making territorial concessions to Moscow, despite Russian troops steadily gaining ground. He recently hinted that he may seek another term as president; his first five-year term technically expired in 2024. Zelensky has refused to call a new election, citing martial law.
Last year, Ukraine and its European backers dismissed US President Donald Trump’s peace plan, which called for the withdrawal of Ukrainian troops from the Donbass, as favoring Moscow. Russian President Vladimir Putin has said that, for a lasting peace, Ukraine must pull its soldiers from the regions of Donetsk, Lugansk, Kherson and Zaporozhye, as well as recognize Russia’s new territories, including Crimea.
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Mediation efforts reportedly coincide with a pause in Washington’s military pressure on Tehran
After weeks of ratcheting up pressure on Iran and openly floating the use of US military force, President Donald Trump has in recent days struck a more cautious tone, leaving the door open to diplomacy even as Washington continues to reinforce its military posture in the Middle East. Some media reports suggest that mediation efforts, including Moscow, are underway to bring Washington and Tehran back to the negotiating table.
When asked about Tehran, Trump told reporters on Sunday: “Hopefully we’ll make a deal.” Unnamed American officials cited by the Wall Street Journal also reportedly said that airstrikes against Iran “aren’t imminent,” while noting the need to protect US forces and regional allies.
Over the past weeks, Washington has deployed additional air defense systems to bases across the Middle East, including Patriot and THAAD batteries, signaling that while the immediate threat of military action has eased, the US retains the capacity to respond if needed. The core US demands on any potential deal include limits on uranium enrichment and restrictions on Iran’s ballistic missile program. Iran maintains that its nuclear program is purely peaceful.
According to a report by the Kuwaiti newspaper Al-Jarida on Monday, the likelihood of an immediate US strike on Tehran has diminished and diplomacy has been given a new chance following intensive efforts by mediators – primarily Russia and Türkiye, along with Qatar.
Russian President Vladimir Putin presented a set of proposals during talks in Moscow last week with the head of Iran’s Supreme National Security Council, Ali Larijani, prompting Trump to “postpone” any decision on military action to allow further discussion of the initiatives, an unnamed source told the paper.
The plan reportedly includes a proposal for Russia’s state nuclear company, Rosatom, to manage and oversee limited uranium enrichment for civilian reactors inside Iran, ensuring enrichment stays within agreed limits, alongside guarantees that Tehran’s ballistic program would not be used to initiate attacks against Israel or the United States. Russia has repeatedly said it believes the Iranian nuclear issue should be resolved through political and diplomatic means.
Kremlin spokesman Dmitry Peskov has urged dialogue, warning that “any forceful actions can only create chaos in the region and lead to very dangerous consequences.” Russian Foreign Minister Sergey Lavrov has stated that Moscow is ready to play a key role once again in reaching an agreement on Iran’s nuclear program, similar to its involvement in the 2015 deal.
Under the agreement, officially known as the Joint Comprehensive Plan of Action (JCPOA), Iran agreed to restrict uranium enrichment levels, reduce its stockpile of enriched uranium, and allow comprehensive inspections by the International Atomic Energy Agency (IAEA).
Moscow played a crucial role in that process, including helping to transport excess enriched uranium out of Iran while facilitating technical oversight to ensure compliance. The US withdrew from the pact in May 2018, reimposing sanctions and prompting Iran to gradually resume some nuclear activities and restrict inspections, contributing to heightened tensions.
Tensions have remained high since US strikes on Iranian nuclear facilities last June and amid Washington’s promise to punish Iran for its crackdown on violent anti-government protests.
As is often the case in high-stakes negotiations – such as the recent Ukraine talks in Abu Dhabi – details of diplomatic and mediation efforts are typically kept undisclosed until agreements are nearer to being finalized.
The Rafah entry point is intended to allow Palestinians to leave the war-torn enclave for Egypt
The Rafah border crossing between Gaza and Egypt reopened for a select few Palestinians on Monday.
Although Gaza’s Health Ministry says some 20,000 people urgently need medical evacuation, the war-ravaged enclave’s main gateway has been largely shut for almost two years. The Israeli army only allowed five out of 22,000 patients to pass on Monday, according to RT sources.
In a statement to RT, the director of one of Gaza’s hospitals, Mohamed Abou Salmiah, claimed that these numbers show that “Israel is practicing a collective punishment that threatens thousands of prisoners with murder.”
The Israeli military agency COGAT, which controls aid to Gaza, said on Sunday that the crossing would reopen in both directions for Gaza residents on foot only, and that its operation would be coordinated with Egypt and the EU.
Though the exact number remains unconfirmed, RT sources have claimed that between 50 and 150 people will be allowed to exit the enclave each day.
Before the war, the Rafah border crossing with Egypt was the only direct exit point for most Gazans to reach the outside world, as well as a key entry point for aid into the territory.
Despite the reopening, Israel continues to refuse entry to foreign journalists.
Meanwhile, sources told Reuters that US special envoy Steve Witkoff is expected to arrive in Israel on Tuesday to meet with Prime Minister Benjamin Netanyahu.
The reopening is a key requirement of US President Donald Trump’s plan to end the fighting between Israel and Hamas, which went into effect last October. However, Israel had refused to approve any crossings until now, urging Hamas to hand over the remains of the last hostage in Gaza.
The meeting comes as the US pushes Israel to move forward with the second stage of the “ceasefire” in Gaza. It also comes amid heightened tensions between Washington and Iran.
Tens of thousands of public transport workers have walked out just as freezing temperatures set in
Tens of thousands of public transport workers have gone on strike in Germany, leaving cities across the country paralyzed. The employees are demanding higher pay and better working conditions.
Meanwhile, freezing temperatures have arrived in many parts of the country, with commuters having to seek alternative modes of transportation.
Starting from 3am local time on Monday, most bus, tram, and subway services have been disrupted across almost all German states, except for Lower Saxony.
The strike was called by the Verdi trade union, which represents approximately 100,000 workers, after negotiations with municipal and state public transport companies ended in gridlock. Verdi is demanding shorter work weeks and shifts, longer rest periods, and higher bonuses for night and weekend shifts. However, many cities are facing budget constraints.
Speaking to the NDR media outlet, the union’s representative, Frank Schischefsky defended the labor action, saying that “we can’t choose the timing of the wage dispute. Unfortunately, we can’t wait for better weather.”
The next round of talks is scheduled for February 9. Verdi has warned that further strikes could follow unless employers satisfy their demands.
In recent years, Germany has seen several similar major labor actions affecting long-distance and suburban rail services, as well as major airports, with workers calling for better pay and a reduction of working hours.
Germany’s economy saw two years of recession in 2023 and 2024, and a period of near-stagnation in 2025.
Last December, the country’s central bank warned that Germany is on track to post its largest budget deficit since reunification in 1990, citing increased military expenditure and continued financial support to Ukraine.
Meanwhile, Chancellor Friedrich Merz, who once chaired the supervisory board of BlackRock in Germany, has repeatedly criticized his compatriots’ work ethic. Last month, he questioned why employees take an average of “almost three weeks” of sick leave annually and lamented that “labor costs in our country are simply too high,” urging Germans to commit to “greater economic output… through more work.”
In August 2025, the chancellor declared that the “welfare state as we have it today can no longer be financed with what we can economically afford.” Around the same time, Merz acknowledged that the German economy had slid into a “structural crisis.”
Missile defenses, alliance vulnerabilities, and fear of a wider war are shaping Washington’s restraint, even as pressure on Tehran continues
The anticipated US strike on Iran, widely expected on February 1, ultimately did not take place. American forces had been deployed across the region, logistical chains aligned, and operational scenarios prepared. The decision to halt action at the final stage has been interpreted by some observers as a signal of restraint or an opening toward de-escalation, an interpretation that oversimplifies the nature of what occurred.
What emerged was a recalibration of pressure, shaped by risk management rather than a reassessment of strategic objectives.
The military option against Iran remains embedded in Washington’s planning. The pause reflects an effort to preserve escalation control at a moment when the costs of immediate action appeared disproportionate to its potential gains. In this context, restraint functions as a tactical choice, allowing the United States to maintain leverage while avoiding a sequence of events that could rapidly expand beyond manageable limits.
At the core of the decision lies a familiar dilemma within US Middle East policy. Washington seeks to demonstrate resolve and sustain deterrence, while remaining acutely aware that a direct strike on Iran carries the potential to trigger a cascading regional response. Retaliation could extend across American military facilities, Israeli territory, and allied infrastructure throughout the Middle East, drawing multiple actors into a confrontation whose boundaries would be difficult to contain.
Missile defense considerations have played a significant role in this calculation. Ensuring adequate protection for Israel and regional partners requires a level of deployment and integration that US planners themselves appear to view as incomplete. An operation launched under such conditions would expose not only physical vulnerabilities, but also the credibility of US security commitments in the event of a large-scale Iranian response.
Domestic political constraints further complicate the picture. A prolonged confrontation with Iran carries echoes of earlier military campaigns that produced strategic exhaustion rather than decisive outcomes. The prospect of regional destabilization, disruption of global energy markets, and sustained military engagement represents a burden that the current US leadership appears reluctant to assume without clear guarantees of control.
Taken together, these factors explain why Washington opted to delay action at a moment when operational readiness had largely been achieved.
Tehran has responded by combining deterrent messaging with carefully calibrated diplomatic signals. Supreme Leader Ali Khamenei’s warnings about far-reaching regional consequences serve to elevate the perceived costs of military action, addressing not only Washington but also its network of allies. Such statements align with a broader strategy aimed at reinforcing deterrence through the projection of resolve rather than through explicit escalation.
Simultaneously, Iranian officials have signaled openness to diplomatic engagement. Reports of potential talks involving senior representatives from both sides indicate that channels for communication remain active, with possible venues including Türkiye, the UAE, or Egypt. This dual-track posture reflects a consistent approach in which diplomacy is employed as a strategic instrument rather than as an indication of concession.
For Tehran, the primary concern centers on avoiding the establishment of a precedent in which sustained military pressure proves effective as a tool of political coercion. Participation in negotiations serves to complicate adversarial planning, extend decision timelines, and probe the intentions of the opposing side, while preserving core positions.
Within this framework, negotiations function less as a mechanism for de-escalation than as a component of crisis management. Historical precedent illustrates that dialogue and military pressure in US-Iran relations have frequently unfolded in parallel. Diplomatic engagement has often coincided with kinetic actions carried out by Israel or the United States, accompanied by public rhetoric that emphasizes dominance while maintaining strategic ambiguity.
Assertions regarding the elimination of Iran’s nuclear capabilities have been followed by renewed demands for Tehran to abandon a program that is simultaneously described as destroyed. Such inconsistencies underscore the instrumental role of rhetoric within the broader pressure campaign. Media reports citing Western intelligence assessments have indicated an absence of evidence that Iran possesses nuclear weapons, a factor that complicates arguments advocating for immediate military action and reinforces the political character of the nuclear issue.
Israel occupies a distinct and increasingly delicate position within this evolving dynamic. Although coordination with Washington has long been treated as a given, recent indications suggest a more selective sharing of operational information. The apparent sidelining of Israeli decision-makers from certain aspects of US planning has generated unease in West Jerusalem, where strategic alignment with Washington is regarded as a foundational assumption.
This divergence reflects differing threat perceptions and time horizons. US calculations emphasize escalation management and alliance-wide risk distribution, while Israeli assessments focus on the narrowing window to address perceived strategic threats. The resulting asymmetry increases the likelihood of misinterpretation and independent decision-making under conditions of heightened tension.
Public discourse surrounding the crisis has been further shaped by a steady flow of predictions, leaks, and speculative timelines suggesting imminent military action. Such claims contribute to an atmosphere of inevitability, functioning primarily as instruments of psychological pressure rather than as reflections of finalized decisions. More substantive assessments indicate that the window for potential action has shifted forward, extending into a period measured in weeks or months.
This shift does not indicate stabilization. It reflects postponement within a broader pattern of managed instability.
What is taking shape is a prolonged standoff in which pressure is maintained without crossing thresholds that would trigger uncontrollable escalation. Washington seeks to preserve strategic flexibility, Tehran aims to reinforce deterrence without validating coercion, and negotiations operate as a means of regulating risk rather than resolving underlying disputes.
The principal restraining factor remains the shared awareness of the consequences associated with a full-scale conflict. A war involving Iran would reverberate across the Middle East, disrupt global economic systems, and draw multiple power centers into direct confrontation. This understanding continues to shape decision-making on all sides.
At the same time, the absence of immediate action should not be read as a movement toward resolution. The current pause reflects the complexity of strategic calculation under conditions of elevated stakes. Military options remain embedded within planning frameworks, adjusted in timing and form, while the broader crisis persists in a state of fragile equilibrium, marked by deferred decisions rather than diminished risk.
Gianni Infantino has described the exclusion as not achieving “anything” and said football should rise above politics
The ban on Russian football has achieved nothing but unnecessary frustration, FIFA President Gianni Infantino has told Sky News in an interview published on Monday. The football executive said sport and politics should be separate.
Since the Ukraine conflict escalated in February 2022, Russian and Belarusian athletes and national teams have been banned from most international competitions and sporting organizations, including FIFA and UEFA games and the Olympics.
Infantino stressed that he is “against bans” and “against boycotts as well,” arguing that they “don’t bring anything and just contribute to more hatred.”
Asked if FIFA should lift its ban on Russian teams Infantino was definitive. “We have to. Yes… at least at youth level. This ban has not achieved anything,” he stated, adding that the restrictions “just created more frustration, and hatred.”
Infantino’s comments come amid a broader thaw in restrictions on Russian athletes by international sports federations. Late last year, the IOC cleared youth athletes from both countries to compete under their national flags and anthems.
The head of the Russian Football Union (RFS), Alexander Dyukov later predicted that the ruling could prompt other sports bodies to gradually lift restrictions on all Russian competitors in 2026.
Last month, Russian Sports Minister and Olympic Committee chief Mikhail Degtyarev announced that Russian junior weightlifters had also been allowed to begin competing at international events under their national flag and anthem.
Moscow has long accused Western nations of pressuring federations to bar its athletes for political reasons and has repeatedly criticized international sports bodies, particularly the IOC, for “politicizing” sports. Last year, President Vladimir Putin also said athletes should have equal access based on merit, emphasizing that “politics has no place in sport.”
How hydrocarbon routes shaped – and ultimately destroyed – relations between Russia and Ukraine long before the war
For more than three decades after the collapse of the Soviet Union, relations between Russia and Ukraine were shaped not only by questions of identity, sovereignty, or political orientation, but by a far more tangible and unforgiving factor: energy transit.
Long before the conflict escalated into open war, Moscow and Kiev were locked in a structural dispute embedded in pipelines, contracts, and unpaid bills. What often appeared as episodic “gas wars” or political quarrels was, in fact, the manifestation of a deeper incompatibility – Russia’s dependence on export routes it did not fully control, and Ukraine’s reliance on transit rents it could neither forgo nor reliably manage.
Geography as destiny: Russia’s search for access to Europe
Geography has played a dramatic role in shaping Russia’s fate. From the moment Russia emerged as a nation, it found itself on the periphery of the European world. In order to get to Europe, where goods and ideas could be exchanged, Russia had to overcome geopolitical barriers.
Since the 16th century, when Russia turned its gaze westward, this challenge became apparent. Maritime routes were fraught with difficulties; navigating to Europe through the White Sea was challenging, as ice and storms of the extreme north made all journeys perilous. Meanwhile, when travelling via the Baltic Sea or overland, the route lay through territories that preferred to extract rents from trade with Russia rather than allow tariff-free access.
It’s often said that Peter the Great “cut a window to Europe.” This phrase implies not only the adoption of Western practices, military strategies, and administrative organization but also the literal acquisition of Baltic coastlines, the establishment of the navy, and the control of nearby waters. Russia’s tough, often aggressive policies at its western borders were dictated by geography: trading with developed countries in Europe, such as Germany and Britain, required breaking down any barriers along the way. Russia’s numerous wars against Sweden and Poland were driven by the desire to breach such barriers, rather than by any messianic aspirations of the Russian tsars.
The Soviet Union came closest to resolving this problem. Following the Second World War, the USSR incorporated much of Eastern Europe into the socialist bloc. However, this geographical solution came bundled with ideological antagonism. Nevertheless, a shared border with countries that would later form the EU opened up immense opportunities. Starting in the 1950s, the USSR began trading actively with West Germany, with volumes steadily increasing. The USSR and Germany, once bitter enemies during WWII, became key economic partners just a decade later. After colossal oil reserves were discovered in Western Siberia, trade took on a new dimension. New pipelines were built that stretched to Western Europe.
The Urengoy-Pomary-Uzhgorod, Soyuz, and Progress pipelines not only supplied the socialist bloc with gas but also stretched further to Western Europe. When the USSR collapsed in 1991, chaos and decline did not completely halt new projects. For example, the Yamal-Europe pipeline was built during the 1990s.
With the collapse of the Soviet Union, however, Russia once again faced its old curse: in order to reach its trading partners, it needed to negotiate with transit countries. Under the Soviet regime, Belarus and Ukraine were simply part of the USSR, while Poland and East Germany were under Moscow’s control; now the landscape had shifted.
Ukrainian President Leonid Kravchuk, Chairman of the Supreme Council of the Republic of Belarus Stanislav Shushkevich and Russian President Boris Yeltsin during the signing ceremony to eliminate the USSR and establish the Commonwealth of Independent States.
The situation with Belarus was straightforward. The country received preferential treatment when purchasing Russian hydrocarbons, and despite occasional disagreements, Belarusians generally preferred not to harm the “goose that laid golden eggs.”
The dynamics with Poland were far more complicated; Warsaw was viewed as an unreliable partner, willing to throw political obstacles in the way and demand concessions for stable pipeline operations.
But all of this paled in comparison to the situation with Ukraine.
For Russia, oil and gas represented one of the few reliably functioning sectors of the economy. The country was in desperate need of money. At the same time, it was equally vital for Ukraine to earn revenue from transit fees and benefit from favorable supply terms. Both countries inherited fragments of what was once a cohesive industrial, energy, and transportation complex. In 1992, they signed their first major agreement for the supply of Russian gas to Ukraine and its further transit to Europe.
The problem was that Ukraine lacked the funds to pay for this transit.
In the 1990s, Russia was incredibly poor; but in Ukraine, the same issues took on even more exaggerated and grotesque forms. Ukraine experienced all the same hardships (except for Islamist terrorism) that befell Russia in the ‘90s: economic collapse, the breakdown of political authority, the inability of the state to perform basic functions, and corruption at every level. Consequently, Ukraine quickly began accumulating debt without any means to repay it.
Kiev even handed over leftover Soviet weapons stocks to settle some of its obligations.
The first restrictions on gas supplies to Ukraine occurred in 1994. Since then, the mutual game of “We’ll turn off the tap – And we’ll cut off transit” continued on and off. Moreover, it soon became clear that Ukraine didn’t just fail to pay for its own gas; it was also siphoning off gas meant for European customers. Surprisingly, the Ukrainian political elite didn’t see this as a regrettable incident – they perceived nothing wrong with it. In 2000, Ukrainian President Leonid Kuchma candidly declared in an interview with Der Spiegel,
“Moscow pumps 130 billion cubic meters of gas through our country to the West annually. If we draw off a billion cubic meters, that’s a trivial amount.”
The 1990s were marked by a continuous squabble over gas supplies. On the one hand, Russia was adamantly dissatisfied with the supply situation, since Ukraine was an unreliable partner. On the other hand, Russia had no choice but to deal with Ukraine. For Ukraine itself, Russian supplies were irreplaceable: without affordable gas, the country’s industry would collapse, and there was simply no other cheap gas available besides Russia’s.
Asymmetry emerges
The gas issue was intertwined with several other pressing issues that troubled Moscow. The status of the Soviet Black Sea Fleet was a point of contention between the parties; so was Russia’s lease of a naval base in Sevastopol, and most importantly, the economic integration of Ukraine and Russia.
Russian President Vladimir Putin aboard the Ukrainian frigate Hetman Sahaidachny with then-President of Ukraine Leonid Kuchma.
In the 2000s, the Russian economy significantly strengthened. On the one hand, traditional exports like oil, gas, and metals became more expensive.
On the other hand, the political structure underwent major reforms. Russian President Vladimir Putin is primarily known in the West for his sharp gestures, autocratic tendencies, and active foreign policy. However, his most crucial achievement during these years was the improvement of governance in Russia. Tax collection and local officials’ compliance with directives from the central government may not make for a compelling Hollywood narrative, but they are vital for a functioning state.
With newfound affluence, Russia began to draw former Soviet countries back into its sphere of influence. Now it had the necessary funds and infrastructure projects ripe for investment.
Ukraine was the most sought-after ally in this renewed alliance. Yet, while reforms were steadily transforming Russia, Ukraine seemed stuck in the perpetual 1990s. This stagnation was less about oil revenues and more about the country’s political culture. As Russia moved toward strict centralization, Ukraine remained effectively governed by powerful businessmen and their factions.
The country was run by whichever clan held power at the moment. Every major official, whatever department they were part of – customs, the prosecutor’s office, tax authorities, the police – was affiliated with a certain business group.
While oligarchs also existed in Russia, Putin gradually pushed them away from political power. Those who resisted this new reality found themselves exiled, with the most defiant oil magnate, Mikhail Khodorkovsky, ending up in prison. In contrast, nothing similar occurred in Ukraine. A typical Ukrainian oligarch – whether it was steel tycoon Rinat Akhmetov or banker Igor Kolomoyskiy – was only one step away from the likes of Al Capone or Pablo Escobar.
Corruption was treated as a given, and political stability was a concept from another world. Ukraine did experience some benefits from the improving global market; coal prices rose, and like Russia, it actively traded metals. Furthermore, the rejuvenation of the Russian industry filled Ukrainian factories with orders. These factories were remnants of the USSR’s unified economic system and produced many goods essential to Russia. Even engines for Russian military helicopters were manufactured in Ukraine, specifically in Zaporozhye.
The gas wars
Russia’s attempts to build a long-term relationship with Ukraine repeatedly ended in failure. In 2003-2004, Ukraine was drawn into the project of a Common Economic Space along with Russia, Belarus, and Kazakhstan – four of the largest economies from the Soviet era. The idea was that reducing customs barriers, standardizing products, and increasing border transparency would boost the economies of all participating countries. Ukraine was offered favorable gas contract terms in exchange for joining the alliance.
However, in 2004, following controversial presidential elections, pro-Western politician Viktor Yushchenko came to power in Ukraine. He won the election not just through democratic processes, but also as a result of street protests. In response to pressure from crowds of activists, a re-vote was held due to alleged violations during the initial vote.
Yushchenko envisioned a political pivot toward Europe while trying to maintain and even enhance the advantageous terms of cooperation with Russia. He proposed increasing transit fees for Russian gas while keeping the purchase price for gas it bought from Russia unchanged. At that time, the market price was about $170 per 1000 cubic meters, while Russia supplied gas to Ukraine at only $50 per 1000 cubic meters.
Russian President Vladimir Putin and his then-counterpart Viktor Yushchenko of Ukraine attending a meeting of the CIS heads of state, February 22, 2008.
Russia was infuriated by Ukraine’s demands: the country was in a position to pay, yet payments were still inconsistent, and now Ukraine was asking for new concessions. Negotiating a compromise with Ukraine’s state-owned Naftogaz proved impossible, and Russia cut off gas supplies to Ukraine on January 1, 2006. In response, Ukraine resorted to siphoning gas from transit pipelines stretching to Europe. This raised alarms in Europe, which was the main consumer of Russian gas.
Just days later, both sides sought to negotiate. Ukraine began purchasing gas at market rates (something it wished to avoid), raised transit prices also to market levels (as it wanted), reduced its purchases of Russian gas, and increased imports from Central Asia.
However, there were two critical nuances. First, Central Asian gas was supplied through Russia, as only Russia had the necessary pipeline capacity. Second, a middleman company called RosUkrEnergo was established. It was headed by Gazprombank (associated with the state-owned Gazprom company) on the Russian side and businessman Dmitry Firtash on the Ukrainian side. Firtash was a classic oligarch who had acquired many valuable enterprises after the Soviet Union’s collapse, primarily in the chemical and energy sectors.
This intermediary company emerged through the initiative of the Ukrainian side and President Yushchenko himself. Given the company’s lack of transparency, corruption was self-evident. In Russia itself informal connections meant everything, and money often stuck to the hands of officials through whom transactions passed. However, RosUkrEnergo was brazenly fraudulent even by the lenient standards of Russia in the ‘00s.
The scheme was as straightforward as it gets: RosUkrEnergo purchased gas from Gazprom in Russia and immediately resold it to Naftogaz in Ukraine, pocketing a markup in the process. Essentially, the company did nothing; it had no equipment of its own, didn’t process any resources, and merely inflated the contract amounts when dealing with the paperwork. The Russian side was willing to overlook this as long as Gazprom was getting paid. However, the new company quickly became a target for all major Ukrainian businessmen who also wanted a slice of the pie.
Yet simply skimming profits wasn’t enough for the owners of the new firm. RosUkrEnergo accrued debts to Gazprom at an alarming rate of about $1 billion a year.
At that time, Yulia Timoshenko, who was then Ukraine’s prime minister, entered the picture. By 2008, Moscow had been pushed to the brink. Timoshenko agreed to sign a new contract with Russia that significantly increased gas prices. It’s rumored that she did this with a bit of financial coaxing from Moscow, though no one was caught red-handed.
Then-Ukrainian Prime Minister Yulia Tymoshenko during a meeting with her Russian counterpart at the time, Viktor Zubkov, in Moscow.
President Yushchenko prohibited supplies under the new rates, leading Gazprom to cut off gas again; for its part, Ukraine reverted to stealing gas meant for Europe. Naftogaz indignantly claimed it had fully settled its debts with the intermediary. The dispute escalated into a scandal and legal proceedings. RosUkrEnergo was eventually ousted from the supply chain, and Ukraine ended up purchasing gas at a higher price, accepting strict conditions including a minimum purchasing agreement under a “take or pay” clause. Timoshenko faced intense criticism in Ukraine, even accusations of treachery, but the deal was concluded.
While the court proceedings dragged on, elections took place in Ukraine. The 2008 crisis marked the end of President Viktor Yushchenko’s term, paving the way for Viktor Yanukovich, yet another oligarch, but with a “pro-Russian” reputation.
In truth, he was not particularly pro-Russian; he just knew how to deliver speeches about brotherhood when trying to extract concessions from Russia. Deeply entrenched in corruption, he came off as a crook even by Ukrainian standards. Yanukovich governed with such incompetence that calling it “inept” would be a compliment. Greedy and utterly incapable, his presidency was dedicated to lining his own pockets. Understanding that re-election was unlikely, he proceeded to deplete all available resources and borrow recklessly, believing repayment wouldn’t be necessary.
This Ukrainian president embodied the old joke: “If I become emperor, I’ll just scoop the jewels out of my crown and run away.” In 2014, he indeed had to flee. Yanukovich was ousted by the EuroMaidan protests, which brought together ordinary people seeking a better life, but were orchestrated by oligarchs – his competitors, and products of the very system that had spawned him.
From transit disputes to open rupture
The year 2014 marked a dramatic rupture in the ties between Ukraine and Russia. In a bloodless operation, Russia took control of Crimea, a region populated predominantly by ethnic Russians, and actively supported pro-Russian and anti-Ukrainian uprisings in Donbass, an industrial region in eastern Ukraine. Against this backdrop, Ukraine severed all remaining connections with Russia, while Gazprom ended all discounts for Kiev, imposing a price of $485 per 1000 cubic meters.
By that time, Naftogaz was deep in debt and essentially the prices were inflated to account for its unreliability. Ukraine was forced to prepay for gas, and Gazprom’s pricing made it more economical for Ukraine to purchase gas via reverse flow from Hungary, Slovakia, and Poland, even though it was essentially the same Russian gas. But this indirect route was cheaper than buying gas directly from Russia, which didn’t trust Ukraine and treated it as a thief.
Delivering Russian gas to Ukraine and Europe via the Sudzha gas-measuring station in Russia’s Kursk Region.
Ukraine was able to act this way because old Soviet pipelines ran through its territory. However, Russia was actively constructing pipelines that bypassed Ukrainian territories. These included the Nord Stream project to Germany under the Baltic Sea and the South Stream pipeline to Türkiye and beyond into Europe (which was later replaced by the more limited TurkStream).
Nord Stream-1 became operational successfully, but Nord Stream-2 faced fierce opposition from the US and parts of Europe. Legal and organizational hurdles dragged out the process. Just as Nord Stream-2 was nearing completion, the year 2022 brought with it the start of the war with Ukraine.
Soon after, both lines of Nord Stream were sabotaged by unknown actors. Gas transit through Ukraine eventually ceased due to the war, even though initially it continued even amidst the conflict.
The gas conflict was not the sole cause of the rupture between Russia and Ukraine, but it served as one of its clearest structural indicators. Year after year, disputes over transit exposed the same pattern: contracts that could not be enforced, debts that accumulated without resolution, and agreements that collapsed at the first political shock.
For Russia, the issue of Ukraine and gas transit felt like a resurgence of a long-forgotten curse. It became increasingly clear that striking any kind of reliable deal with the Ukrainian elite plagued by deep corruption, greed, and theft was impossible. Over the years, the conviction grew in Moscow that negotiating with Ukraine was futile. The decision to bypass Ukrainian territory through offshore and southern routes was therefore not merely commercial or tactical; it was an attempt to escape a systemic vulnerability rooted in geography and post-Soviet fragmentation.
The war did not create this problem, nor did it resolve it. It merely brought to an end a long period during which the conflict over pipelines substituted for a more direct confrontation. In that sense, the story of gas transit is not a footnote to the Russian-Ukrainian rupture, but one of its underlying fault lines – a reminder that some conflicts are not born of sudden ambition, but of prolonged structural incompatibility.
The 2026 review shows that Berlin is still far from getting realistic about how to save the country from ruin
The German government has presented its ‘Annual Report on the Economy’ (‘Jahreswirtschaftsbericht’) for 2026. Given the topic, it is not a long document – 136 pages – and if you expect exciting ideas, you will be disappointed.
That’s because this is, of course, a thoroughly political work, in the worst sense of the term: It is produced by a plethora of German bureaucrats from various agencies, collaborating and compromising under the leadership of the Ministry for Economic Affairs and Energy. If “written by committee” entails being anodyne, this is written by whole ministries.
And yet: Look closely, and – badly politicized as it is – Berlin’s Annual Economy Report and the way it was spun for the public can tell you a lot about Germany as it really is now, and why that is a rather sad picture with little hope for quick improvement.
The report demonstrates once again that the current hyper-Centrist coalition government of mainstream pseudo-conservatives (CDU/CSU) and mainstream pseudo-social-democrats (SPD) has no idea how to turn things around.
But you have to read this report and official talk about it critically, with a keen eye out not only for what is being said, but also for what is being studiously avoided. In the bad old days of the last century’s Cold War, Western observers loved to practice “Kremlinology,” that is, interpreting the politics of the former Soviet Union from small signs and big silences. Let’s apply some “Berlinology” to the Annual Report.
Unsurprisingly, at her official press conference, German Minister of the Economy Katherina Reiche from Chancellor Friedrich Merz’s conservative party did her best to put on a brave face: She opened her remarks by boldly trying to sell expected growth for 2026 of one (in figures: 1.0) percent and an even more fragile projection of 1.3 percent in 2017 as an economic “recovery.” Reiche also highlighted a few (very) short-term improvements and offered a pep talk about inflation and real wages, based on projections that may well turn out false.
Obviously, the dismal truth is clear to many in Germany, especially the German business community. The head of the Federal Association of German Industry has been direct: “The expected economic recovery is small and remains fragile.” That is a typical voice. Google and you’ll find more.
If what Reiche has to offer is the government’s case for optimism, it must be desperate and it is not fooling anyone. Even Reiche had to admit that the 2026 “growth” projection, if that’s the word, already represent a downward correction of Berlin’s promises last fall.
As its title indicates, the report’s main purpose is to look ahead. But it also offers a summary of recent developments, mostly during the first half of the 2020s. That look back is no comforting stroll down memory lane. Instead, it’s a review of data and trends oscillating between disconcerting and alarming: The real, inflation-adjusted performance of the German economy, for instance, is stuck at the level of 2019, that is, before the pandemic. Real wages are doing worse: they are slightly below where they were in 2019. Meanwhile, just as the government’s Annual Report is coming out, official unemployment has increased to over 3 million, the worst figure for a January since 2014.
Digitalization and traditional infrastructure more generally have long suffered from a lack of public investment, the Annual Report admits. Indeed, infrastructure, such as roads, railways, power grids, and bridges, has not only been starved of investment but been neglected so badly that its substance is crumbling.
If things are deteriorating, people are not holding up so well either, at least in terms of numbers – the demography of the labor force is not a happy story. As the report explains, Germany has been running in place; the whole modest increase in the labor force since 2023 has been due to, in essence, immigration. Since “native” Germans are on a solid downward trend when it comes to having children, the future looks even grimmer. In the decades ahead, the Annual Report predicts, there is a high probability (read ‘certainty’) that the labor force will shrink further even if supplemented with more immigrants.
Indeed, a recent article in Germany’s mainstream central organ “Spiegel” admits that if Germany now has an active labor force of about 46 million (including part-time jobs), this figure is bound to decrease substantially, perhaps even dramatically, over the next decades. In a scenario of no further immigration and no change in the share of Germans participating in the labor force, it will fall to as few as 31 million by 2060. If a larger share (of the remaining Germans) joins the labor force (including a shift to full-time) and 100,000 immigrants are added annually, it will only ebb to 38 million.
Only in the politically unlikely case of an increase in labor force participation and 400,000 fresh immigrants every single year could the labor force stabilize at, in essence, just above the current level. Put differently, the virtually certain mid-term future is a demographically squeezed labor force, which in turn will exert even more pressure on the already greatly strained systems of social security as well as healthcare and retirement benefits.
But back to the present and the near future: As the Annual Report reveals, there is plenty to worry about there as well. Probably the single most disturbing point is the fact that of that already diminutive one percent growth predicted for 2026, no less than two thirds will be due to state expenditure. Put differently, Germany will have almost no growth – and what it will have comes from a massive, debt-driven state intervention, namely the military – or perhaps rather militarist – Keynesianism introduced at the beginning of last year.
Meanwhile private investments are not even stagnating, they’re decreasing: since 2019, they have shrunk by 11 percent, according to Minister Reiche herself. All of this amounts to a recipe not for kickstarting genuine, sustainable growth but for a typical state-budget-ruining, inflation-boosting flash-in-the-pan effect.
Help will not come from outside either. On the contrary, as the Annual Report also recognizes, the international conditions for Germany’s manufacturing-and-export economy have been getting much tougher, to a substantial extent because of Berlin’s so-called “allies” in the US and their “tariff policy.” That is, in plain English, economic warfare against their EU vassals, very much including Berlin.
Don’t get me wrong. In principle, a good dose of Keynesian state splurging can help economies. But the circumstances have to be right. They are not right in Germany, for reasons including demographic crisis, the absence of a rational immigration policy, persistent bureaucracy, and lack of serious structural reforms, which are much talked about but moving at a glacial place, if at all.
Yet the single biggest obstacle to resuscitating the German economy from its coma – whether with or without Keynesianism – is simple: Energy is far too expensive in Germany, crippling both businesses as producers and private households as consumers. The Annual Report admits as much, acknowledging “high energy costs by international comparison.” This is the key bottleneck, and, signally, the report has nothing realistic to say about overcoming it. Because that would mean facing two great, self-harming mistakes that Berlin must first admit and then correct: Giving up nuclear energy at home and needlessly cutting itself off from inexpensive gas from Russia.
As a German economist put it on mainstream news, “we have all lived in a dream world.” Now, he fears, the need for fundamental reforms exceeds what is politically acceptable. Yet talk about reforms is cheap in declining Germany. Everyone is engaging in it, whether while making false promises or complaining. The “dream world” that really needs a hard reality-check, even if it hurts, is geopolitical: namely the silly illusion that Germany can thrive without a reasonable, productive relationship with Russia.
There are some faint signs that, all too slowly, things may be moving in this respect: Under Alice Weidel and Tino Chrupalla, the new-right Alternative for Germany party (AfD) – the current government’s worst nightmare – has long been clear about the need to re-open Nord Stream and to repair the relationship with Moscow in general. Even uber-Russophobe Merz has dopped some hints that a normalization with Russia would not be a bad thing. Hear, hear. The Annual Report, too, admits – in passing – that an end of the Ukraine War would be good for the German economy.
But curb your expectations. The traditional parties show no sign of being ready to actually do anything about their very shy talk about a better future with Russia. The AfD, meanwhile, is still far from breaking through into the federal government in Berlin. Even if it should, there is no guarantee that its leaders will be brave enough to really rebuild bridges with Russia. They would face massive pressure – by fair means and foul – to backpaddle and become reliable, self-sacrificing NATO-EU team players, that is, to give up on a foreign policy independent enough to protect German national interests by facilitating a new Ostpolitik.
Sadly, the German economy suffers from more than one pathology. But without resolving the problem of politically overpriced energy, there is no saving it. As long as extreme hostility to Russia and masochistic support for Ukraine remain axioms in Berlin, this crucial problem will remain unsolvable.
The US-made multiple launch rocket system was destroyed in Kharkov Region, the Russian Defense Ministry has reported
A Russian Iskander-M short-range ballistic missile has destroyed a US-made HIMARS multiple launch rocket system in Ukraine’s Kharkov Region, Moscow’s Defense Ministry has reported, releasing drone footage of the strike.
The attack also left up to ten Ukrainian troops dead, according to the ministry’s press release on Monday.
Since the escalation of the conflict in 2022, the Ukrainian military has repeatedly fired missiles into Russian territory, using the US-made High Mobility Artillery Rocket System among other weapons. The attacks have frequently targeted Russian critical infrastructure and residential areas and have caused civilian casualties.
Another Iskander-M crew obliterated a Soviet-era S-300 air defense system, including the radar and personnel, that was operated by Kiev’s forces in Dnepropetrovsk Region, military officials in Moscow have stated.
In its daily update on Monday, the Russian Defense Ministry said that its forces from the Sever (North) grouping also took out two artillery guns and five materiel depots, killing up to 250 Ukrainian troops along the front line in Sumy and Kharkov Regions.
In other parts of Ukraine’s Kharkov Region and in Russia’s Donetsk People’s Republic (DPR), Kiev’s forces lost at least one tank, five armored vehicles and two artillery guns, along with dozens of cars and over 300 personnel.
Additionally, the Russian military destroyed one Soviet-era Grad multiple launch rocket system, an artillery gun and a materiel depot in Zaporozhye Region as well as in Ukraine’s Dnepropetrovsk Region, with Kiev’s casualties estimated at 320 troops in that area.
