Eurasia Daily Monitor -- Volume 15, Issue 89

This year’s G7 summit, held in Quebec, Canada, on June 8–9, was overcome by seemingly unprecedented controversies even before United States President Donald Trump suggested bringing Russia back into this elite club of the world’s largest liberal-democratic economies. Only the newly appointed Italian Prime Minister Guiseppe Conte may have found this idea worth contemplating (see EDM, June 6). The other five members did not even bother marshalling arguments against this impromptu proposal, because it is too obvious that Russia, with its authoritarian rule and aggressive behavior, cannot possibly belong to this group of democratic states (Newsru.com, June 8). Moscow was invited into the G7 in 1997, but was suspended from participation in the reformatted G8 in 2014, after its invasion of Ukraine. The list of candidates for the G7’s theoretical enlargement could perhaps include Australia, South Korea or India, but the prime minister of the latter was actually busy attending the summit of the Shanghai Cooperation Organization (SCO), in Qingdao, China. This club used to bring together Russia, China, and four Central Asian states (Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan). Last year, however, India and Pakistan were admitted as full members, while Iran remains an observer.

The coincidence of these two parallel gatherings demonstratively disproves Trump’s main reason for inviting Russia back—“because we have a world to run.” At present, the disunited Western democracies cannot pretend to set the rules for the disorderly rest of the world (Nezavisimaya Gazeta, June 9). Three dramatic US withdrawals—from the Paris climate accord, the Iran nuclear deal, and the commitment to free trade—executed by the Trump administration in the year since the previous G7 summit, in Sicily, have severely undermined the collective West’s ability to lead in global affairs (RIA Novosti, June 9). Quite possibly, Trump surprised his partners with the Russia proposal simply to shift attention away from the issue of US tariffs on steel and aluminum. Such tumultuous trade policy has grown into a major irritant in relations with allies, including Canada and France, which had earlier been ready to go a long mile to build rapport with the maverick US president (Forbes.ru, June 8). Yet, at the same time, it may have, on some level, been an attempt to remind Moscow where it used to belong and could still return if it was willing to put in the effort at self-reinvention.

Meanwhile, President Vladimir Putin was given an extra-friendly welcome in Beijing (Kommersant, June 9). However, too many sights likely remind him of how fast China is building its power and how deep Russia’s dependency is growing. Overall, he looked much more comfortable in Vienna, Austria, where he traveled a couple of days prior to the trip to China (Ezhednevny Zhurnal, June 7). The ritualized show of respect toward Putin in China camouflaged an actual lack thereof; but in Europe there is still plenty of genuine interest in and awe of Russia’s power—corrupt as it is. The Russian head of state recently had meetings with French President Emmanuel Macron and German Chancellor Angela Merkel, but the one he is really keen to have is with Trump. And the Kremlin has repeatedly signaled its readiness to make haste with the preparations (RIA Novosti, June 9).

Europeans are anxious about this prospect because it is unclear what Putin might put on the table besides compliments on Trump’s ability to listen and respond (TASS, June 8). The two leaders will almost certainly ignore such “mundane” matters as climate change or gender equality; their views on migration are also quite far apart; and the joint counter-terrorism agenda is effectively exhausted. Syria certainly makes for an important topic, and it is significant that General Joseph Dunford, the chairman of the US Joint Chiefs of Staff, and General Valery Gerasimov, the chief of the Russian General Staff, focused on it at their recent meeting in Helsinki, Finland (TASS, June 8). This de-confliction is crucial for preventing another direct clash between US and Russian forces, like the one in February (see EDM, February 15, 20)—confirmed by Trump but denied by Putin, who keeps praising the “noble mission” of the Russian intervention (RIA Novosti, June 7). Yet, given the depth of disagreements on the Iran issue, it is difficult to see how the US-Russian discussions on Syria could progress beyond de-confliction talks. Knowing how crucially important the meeting with North Korean dictator Kim Jong-un has become to Trump, Moscow has tried hard to boost its profile in de-nuclearization diplomacy. But Russia’s ability to make a difference on the Korean peninsula remains miniscule (Nezavisimaya Gazeta, June 1).

This leaves the traditional area of arms control as the main subject of possible high-level bilateral discussions, and there is certainly a rich menu of problems in this dangerously neglected field (Novaya Gazeta, June 8). One of the easiest questions to resolve could be the prolongation of the New START treaty, which is set to expire in 2021; though, Trump may be seriously reluctant to embrace this key element of former President Barack Obama’s legacy. Separately, Russia is in violation of the Cold War–era Intermediate-range Nuclear Forces (INF) treaty, while simultaneously accusing the US of technical violations. Trump’s instructions to prepare a new set of sanctions targeting specifically Russia’s INF non-compliance may actually help to focus political attention on breaking this deadlock (Vedomosti, May 17). The brisk development of new technologies in their nuclear arsenals, of course, seriously hampers negotiation efforts. And both Trump and Putin would presumably prefer to achieve a sensational breakthrough without compromising on any matters of prestige.

Russian officials have expressed skepticism about the idea of returning to the G8 format, knowing full well that a key condition for such rehabilitation is the cessation of Russia’s aggression against Ukraine, which, for Putin, is out of the question. Trump probably had not meant to remind everyone of the reason for Moscow’s expulsion; but his loose remark drew international attention back to the ongoing war in Donbas, whereas domestic attention in Russia inevitably refocused on the costs and consequences of this deadlocked aggression (Rosbalt, June 8). Putin keeps trying to talk Russia’s economy into revival, but stagnation remains the best the country can hope for. Animated discussions on new sources of growth—like those that dominate various international fora, including the G7 and the SCO—are foreign to the Kremlin. For Russia, shaking off the depressing downturn of Putinism will always be a possibility, however remote. But if it occurs, it will undoubtedly be sudden.

On his first Western trip since reelection to a fourth term as president of Russia, Vladimir Putin traveled to Austria—a right-leaning country he hopes will help him weaken European Union solidarity (Kremlin.ru, June 5). The June 5 visit was rife with energy diplomacy, including Putin’s desire for Vienna to make good on a hint that it would push for lifting EU sanctions affecting Russia’s gas business in Europe.

The timing of Putin’s trip was fortuitous, given that Austria assumes the six-month EU rotating presidency next month. But Putin walked away disappointed on sanctions relief. Austrian Vice Chancellor Heinz-Christian Strache’s recent call for “lifting these exasperating sanctions” had buoyed Putin’s hopes (RIA Novosti, June 3). However, during his visit, Austrian Chancellor Sebastian Kurz pledged to maintain “the decisions of the EU, including on sanctions” (EurActiv, June 6).

A slice of good news for Putin was that Austria’s energy giant OMV agreed to extend a contract under which it will obtain natural gas from Russia’s Gazprom through 2040. Gazprom supplied a record 9.1 billion cubic meters (bcm) to Austria in 2017—93 percent of its imports (Gazprom, June 1). OMV, which has a partnership with Gazpromneft in Iran, refused to follow Italy’s Total and the Netherland’s Maersk in leaving the Islamic Republic when Washington imposed new sanctions on Tehran after pulling out of the Iran nuclear deal (Iran Business News, May 30).

In addition to facing United States sanctions for staying in Iran, OMV could be targeted by sanctions for investing in the Nord Stream Two pipeline, which will double the amount of gas Russia delivers directly to Germany and beyond, from 55 to 110 bcm per year. The pipeline is criticized by the US government, Brussels and most EU member states as a tool for undermining European energy security, politically splitting the transatlantic community, and harming Ukraine’s strategic role as a transit country—currently Kyiv’s most important remaining non-military leverage against an aggressive Moscow (see EDM, April 11, May 10). Washington is reportedly preparing sanctions against the European participants in the project, including OMV (Sputnik News, March 21).

Meanwhile, Turkey’s decision to build the second string of Turk Stream—a pipeline that would send Russian gas to southeastern Europe and beyond—has prompted Moscow to intensify its energy diplomacy with the countries the pipeline will transit. And Austria is important to Russia’s success in this endeavor as well. Last year, Gazprom said it wanted to extend the second, Europe-bound pipeline string from the Turkish-Greek border to Baumgarten, the Austrian natural gas hub facility that distributes 40 bcm of gas annually across the continent. On its way, this extended Turk Stream line would need to traverse Bulgaria, Serbia and Hungary (Interfax, November 24, 2017). Russia has already started talks with Bulgaria and Serbia on the matter (Rigzone, May 30, 2018; Sputnik News, February 22). Even more than with Nord Stream Two, Gazprom’s energy diplomacy in Southeastern Europe stems in large part from its determination to circumvent Ukraine as a transit route for Russian gas to Europe. With talks on the fate of Ukrainian transit beyond 2019 at an impasse, Gazprom is continuing to build partnerships with European gas importers.

Last month (May), the Russian gas monopolist struck a gas deal with Hungary for 2019. In another energy development, Russia’s Rosatom pledged to begin building two blocks of the Paks nuclear power plant in Hungary in 2020 (Budapest Business Journal, May 25). Meanwhile, Bulgarian Prime Minister Boyko Borissov said Turk Stream would reach his country, allowing it to import Russian gas; and Rosatom said it would bid for Bulgaria’s Belene nuclear project (Rigzone, May 30).

One of the Russian energy juggernaut’s few misfires in Europe came when the Ukrainian pipeline company Naftogaz announced that the Dutch government had seized Gazprom assets at its request. Naftogaz is trying to obtain a $2.6 billion settlement that the Stockholm Arbitration Court imposed on Gazprom earlier this year (see EDM, March 5) for refusing to supply Naftogaz with the full amount of gas the Ukrainian company had contracted for. Six of seven Gazprom subsidiaries in the Netherlands had refused to comply with the arbitration order (Interfax, June 6), which Gazprom is appealing (Interfax, March 22).

Ukrainian President Petro Poroshenko asked the Netherlands, the United Kingdom and Switzerland to freeze Gazprom’s assets. The Netherlands and the UK themselves have seriously strained relations with Russia. London accuses Moscow of poisoning former Russian spy Sergei Skripal on British soil, while the Dutch government blames Russia for the downing of Malaysian Airlines Flight 17 over eastern Ukraine in 2014 (RIA Novosti, May 25). The Swiss connection is that Nord Stream Two AG, the pipeline project’s managing company (100 percent owned by Gazprom), is registered in Zug, Switzerland (Interfax, May 30).

Russia is trying to protect its share of the European gas market in the face of the United States, Poland and the Baltic States opposing Nord Stream Two, and the EU imposing various energy-related regulations on Moscow. Although Russia’s battle will not be easy, President Donald Trump’s trade war with Europe and his unilateral pullout from the Iran nuclear deal—while European countries continue to try to stick to it—will undoubtedly help Russia’s cause.

Russian activity in the Sea of Azov has been ramping up considerably in recent weeks. After the official opening of the Kerch Strait Bridge, on May 16 (see EDM, June 1), Russia’s Federal Security Service (FSB) started carrying out systematic boarding and inspections of vessels in the Sea of Azov traveling to and from the Ukrainian ports of Berdyansk and Mariupol (Mariupil). Some of these incidents (38 to date, as of May 17) occurred only 5–7 miles from the Ukrainian coast and lasted up to 8–10 hours before the vessels were allowed to depart on their way (Blackseanews.net, June 7). Moreover, Russian maritime security activities in the area have greatly lengthened the amount of time merchant vessels must wait before obtaining permission to pass through the Kerch Strait on their way to Mariupol and Berdyansk—this downtime can often last a day or more. In early June, the ship Selekta, which was traveling to Mariupol, had to wait 38 hours for permission to pass through the Strait (de facto controlled from both sides by Russia since the 2014 illegal annexation of Ukraine’s Crimean peninsula). This vessel was then stopped again in the Sea of Azov by an FSB boat, boarded, and subjected to an inspection that lasted an additional three hours. Such delays and inspections only appear to impact vessels entering or leaving Ukrainian ports on the Sea of Azov (Dzerkalo Tyzhnya, June 9).

Russian naval forces as well as maritime assets of the FSB coast guard operating in the Sea of Azov have increased many-fold since earlier this year, and they continue to grow (Glavnoe.ua, June 6). Additions to the region have notably included artillery boats and small missile ships redeployed from the Caspian Flotilla (Hromadske Radio, June 5; see EDM, May 31). Indeed, the appearance, in the Sea of Azov, of two small missile ships armed with Kalibr long-range cruise missiles has tellingly boosted Moscow’s ability to rain high-precision strikes on the entire depth of the territory of Ukraine from two offshore operational zones simultaneously—on either side of the Kerch Strait (Topwar.ru, June 6). Moreover, the Russian Black Sea Fleet has dramatically augmented the number of its joint amphibious drills (TASS, March 21, 2017; Kafanews, March 20, 2017), including massive exercises involving aviation and air defense forces (Interfax, June 5, 2018).

Also notable has been the growth of Russian oceanographic fleet assets, with capabilities to conduct “hybrid” (“New Type”) naval operations (see EDM, January 23). These ostensibly civilian Russian vessels are manned, at least in part, by what might be termed “little blue sailors”—individuals who are not exactly uniformed personnel (Usni.org, December 2016). In addition to installing various oceanographic equipment in the area, including near underwater communications cables, their activities have been significant for the growing use of unmanned underwater vehicles (UUV) (Vesti, July 13, 2012; Sudostroenie, March 22, 2018; Azniirkh.ru, Ssc-ras.ru, accessed June 11, 2018). Currently these vessels are involved in complex oceanographic expeditions in the Sea of Azov (Azniirkh, accessed June 11).

Furthermore, Russian “hybrid” maritime activity in the Sea of Azov appears to involve the use of Electronic Warfare (EW). Andrii Klymenko, the head of the supervisory board of the non-governmental organization Foreign Affairs Maidan, noticed that, for several days in May–June 2018, the Automatic Identification System (AIS) for live tracking of maritime traffic appeared not to function over the main navigable areas of the Azov Sea (Facebook.com, June 3). One possible reason for this outage could have been a malfunction at the receiving station in Temryuk, Russia. However, there have been no Navigational Area (NAVAREA) warnings issued about repairs or an emergency situation at Temryuk station. Moreover, throughout the outages, the station remained color coded as “green” on the AIS online marine traffic maps, meaning it was in working condition. Yet, the station’s apparent temporary shutdown suggests the AIS outages were intended to hide Russian ship traffic. According to the International Convention for the Safety of Life at Sea (SOLAS 74/88), such activities can be classified as a threat to navigation. Additionally, one year ago, AIS transponders of at least 20 vessels were affected by GPS spoofing attacks in the Black Sea, near the Russian coast—the likely targets of a Russian cyber weapon being tested (Newscientist.com, August 10, 2017).

Russia’s strategy in the Sea of Azov seems designed to take control of the waters all the way up to the Ukrainian coast line, thus putting pressure and additional costs on Ukraine-bound maritime shipping traffic. In fact, like a boa constrictor, it aims to economically strangle southeastern Ukraine’s industrial seaport areas and destabilize the social situation there. And the broader implications of this strategy become clear when lessons from the Crimea annexation are juxtaposed against evidence of Russia’s growing regional amphibious potential and the apparent directions of its offensive training drills. As such, it is important not to forget about Moscow’s naval probes in the Black Sea, testing Kyiv’s responses to its activities near Odesa and Snake Island (Dumskaya, June 7). In other words, the threat of a Russian amphibious operation to seize additional southeastern Ukrainian coastal territories is growing. And against the backdrop of water shortages in Crimea as well as other factors, it should not be ruled out that Moscow may still be contemplating wresting a land corridor to the peninsula (Apostrophe, June 7) or at least trying to force Kyiv to open Dnipro’s water supply to the occupied territory (Segodnya, June 2).

Ukrainian Deputy Foreign Minister Olena Zerkal, commenting on the rising tensions in the Sea of Azov, noted, “Russia seeks various ways to provoke Ukraine to react to this or that situation in a way that [...] will prevent consideration by the [United Nations] tribunal of the issue of Russia’s violation of our sovereign rights.” She stressed the need for a “peaceful and legal settlement,” which is “optimal and effective” (Dzerkalo Tyzhnya, June 9). However, historical experience shows that so-called “soft” power without “hard” power is rather impotent. Sudden crises require a rapid and comprehensive multi-dimensional assessment and response, particular under the conditions of “New Type” warfare. Undoubtedly, Moscow will continue to use “hybrid” forms and methods of warfare to achieve its goals, with the Crimean annexation serving as a useful blueprint (Obozrevatel, May, 26; Voice of America, June 1; Dzerkalo Tyzhnya, June 9).