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UKRAINE UPDATE: 4 SEPTEMBER 2023

St Petersburg oil depot ablaze; Russia strikes Danube River port before key talks

St Petersburg oil depot ablaze; Russia strikes Danube River port before key talks
Seeds burn in a grain storage facility destroyed during combat in the village of Dovhenke, Kharkiv region, Ukraine, on 2 September 2023. (Photo: EPA-EFE / Oleg Petrasyuk)

A fire was reported on Sunday at an oil depot in St Petersburg, with social media images showing the area blanketed by thick smoke. No cause was announced.

Russia launched waves of Shahed loitering drones overnight aimed at port facilities and other infrastructure in Ukraine’s southern Odesa region.

Ukrainian media reported explosions and a fire in Reni, a major Danube River port near the Romanian border. Nato member Romania confirmed a strike on Reni’s port infrastructure, calling it a “deep contradiction with the rules of international humanitarian law”.

Russia continues to target ports “in a hope that they will be able to provoke food crisis and hunger in the world,” Andriy Yermak, chief of staff to Ukraine’s president, said on Telegram. The strikes came a day before Russian President Vladimir Putin and his Turkish counterpart Recep Tayyip Erdoğan were scheduled to meet in Sochi, Russia. Turkey’s leader is expected to attempt to persuade Putin to rejoin the Black Sea grain deal that Russia abandoned in July. 

Russia said it downed a drone over the Belgorod region north of the Ukrainian border. Ukraine’s president spoke to French President Emmanuel Macron on Sunday, including about “ways to ensure the functioning of the grain corridor and enhance the security of the Odesa region”, Volodymyr Zelensky said in X, formerly Twitter.

Latest developments

Ukraine targets tycoon Kolomoisky in criminal probe

Ukrainian oligarch Igor Kolomoisky has been served with a “notice of suspicion” of fraud, the Security Service of Ukraine said on its website. 

Kolomoisky is suspected of the embezzlement of illegally obtained property, according to findings by the Security Service and Ukraine’s Economic Security Bureau. A Ukrainian court ordered the detention of Kolomoisky for 60 days as a preventive measure, according to a court video published by the Ukrayinska Pravda website late on Saturday.

Kolomoisky didn’t reply to a request for comment. He has the option to post bail that was set at nearly 510 million hryvnia ($13.8-million).

From 2013 through 2020 he embezzled more than 500 million hryvnia from banking institutions under his control, according to the statement. A pre-trial investigation supervised by the Prosecutor-General’s Office is under way.

President Volodymyr Zelensky’s push to eliminate corruption recently included investigations against government officials and dismissals of lawmakers. He was elected in 2019 on a campaign to root out corruption and the influence of oligarchs.

Nobel Foundation scraps plan to invite Russia, Belarus and Iran

The ambassadors of Russia, Belarus and Iran won’t be invited to this year’s Nobel Prize award ceremony in Stockholm after all, following a backlash.

“We recognise the strong reactions in Sweden,” the organisation based in the Swedish capital said in a statement on Saturday. “The board of the Nobel Foundation, therefore, choose to repeat last year’s exception to regular practice — that is, to not invite the ambassadors of Russia, Belarus and Iran.” 

Oleg Nikolenko, a spokesman for Ukraine’s foreign ministry, called the decision “the victory of humanism” in a Facebook post. 

The foundation announced on Thursday that it would invite the representatives of the three countries, reverting to a practice dating from before Russia’s February 2022 invasion of Ukraine.  

The coveted annual prizes will be announced from 2-9 October and the prize banquet in Stockholm is slated for 10 December.

All ambassadors will still be welcome at a separate ceremony in Oslo, also on 10 December, to mark this year’s peace prize, the foundation said. 

Ukraine’s frontline professor heads for hostile zone in Hungary

Ukrainian Army volunteer Fedir Shandor became an international sensation when a video of him teaching sociology students on a laptop in frontline trenches went viral. Now he’s heading for a different hostile environment.

Kyiv has named Shandor to become its ambassador to Hungary, a neighbouring European Union and Nato country that has unusually sought to strip support for Ukraine and amplify Kremlin talking points as it fights off Russia’s invasion.

He’s partially ethnic Hungarian and lives in a western region where many Ukrainians have Hungarian heritage and speak the language. Zelensky is betting those roots may help break through Hungarians’ suspicion of Ukraine that has been bolstered by pro-Russian messaging by Prime Minister Viktor Orban’s government.

“I never thought my career would take such a turn,” Shandor, who has no prior diplomatic experience, said in an interview from his native city of Uzhhorod, near the Slovak and Hungarian border where he was on break from the fighting. “But it’s very close to education, only you educate people about your country abroad.”

It will be a challenge. Orban has maintained close ties to the Kremlin and has sought to end western support for its eastern neighbour, refusing arms shipments, threatening to block EU financial aid and calling for an end to economic sanctions against Russia. He has also accused Kyiv of curbing the rights of the Hungarian minority in Ukraine.

Shandor’s background — his father is Hungarian, but he grew up in a Ukrainian-language home after his parents’ divorce —  may now serve to help weaken Orban’s Ukraine narrative, which is centred on a call for an immediate ceasefire to protect the ethnic Hungarians living in western Ukraine. 

“As soon as we kick out the enemy and defeat the Russians, for sure the Hungarian formula will work,” Shandor said.

Shandor said he was approached by Zelensky’s team after he appeared in a short clip with two other soldiers holding the Hungarian and Ukrainian flags after they liberated the occupied town of Ambarne in the northeastern Kharkiv region.

Shandor volunteered to join the infantry the same day Russia invaded in February last year. As a father of two boys and two girls, he waived an exemption granted to men with three or more children.

He has since mostly been holed up in dugouts and trenches. Some of his comrades died in action, and Shandor took over his unit when his predecessor was killed. He’s continued to teach courses online while dodging Russian shells and bullets.

War in Ukraine tests Austria’s status as gateway to the east

Waagner-Biro Bridge Systems makes modular steel overpasses that can span rivers and valleys in conflict zones. As Ukraine seeks help to restore infrastructure, the equipment might look like a perfect fit.

Even as Russia’s war shows no signs of abating, Ukraine’s allies are already looking at how to rebuild and Austria wants to be front and centre of that effort. The Vienna-based company, though, hasn’t delivered a single bridge and CEO Richard Kerschbaumer said he doesn’t expect that to change this year.

Austria has profited from being a gateway to the east, but companies like Waagner-Biro are now hindered by decades of the country’s close ties with Russia and a political leadership that’s caught between promoting commercial interests and the country’s military neutrality.

Ukraine expects handouts in exchange for its military sacrifice, but someone needs to pay for them, said Kerschbaumer. “Our hope is that not only Austria, but also Europe or the World Bank will release funding,” he said.

Among the largest winners from the fall of communism in Eastern Europe, Austrian companies have reaped billions of euros each year from a web of subsidiaries spanning Russia to the Balkans. Ties to the region going back to the Habsburg Empire allowed Austrians to be among the first investors in economies looking to move on from their socialist past.

But proximity and history are not enough in the latest conflict, and Austria appears less able to leverage its geography in the way it used to as the European Union and other donors come up with billions of euros for Ukraine.

Politicians have been more bullish. Waagner-Biro was part of the Austrian delegation, along with companies such as construction giant Strabag, taking part in June’s Ukraine Recovery Conference in London. Foreign Minister Alexander Schallenberg, who represented Austria at the meeting, said the heavy commercial presence was a “political signal of hope.”

After the Cold War, Austrian banks, insurers and builders were among the first to move into Eastern Europe, investing heavily in ex-Soviet states and satellites, including Ukraine, and establishing themselves as dominant market players. Austria’s capital, Vienna, is closer to Ukraine’s border than Switzerland to the west.

“The Austrian state is known for its close ties,” researchers at the Vienna-based think tank Agenda Austria wrote in response to questions. Austria’s “companies have a strategic advantage” and “should benefit greatly” from the reconstruction of Ukraine, whenever it happens. 

They will be competing, though, with firms from countries like France, Germany and the UK that have been directly involved in arming Ukraine since Russia’s invasion in February last year.

Officials across the political spectrum say Austria can’t legally provide the artillery and guns Ukraine needs to defend against invasion. Instead, the nation is helping in other ways, the officials argue. It’s taken in almost 100,000 Ukrainian refugees while the Foreign Ministry says it’s spent more than €150-million on direct support. 

But the country is still the target of criticism for failing to sever economic ties with Russia. Raiffeisen Bank International, for example, runs the largest foreign-owned banks in both Russia and Ukraine. It has more than €3-billion of profits stuck in Moscow, accumulated over a lucrative 18 months trading the rouble and withheld due to capital controls.

The bank’s management has been gradually winding down its business in Russia while stalling on a review of options to sell or spin off the unit. Raiffeisen CEO Johann Strobl said this week he’s committed to getting rid of the Russian unit and blamed the delay on the regulatory authorities and the legal complexity of sanctions. “It’s not an excuse, it’s reality,” he told the same conference attended by Edtstadler.

Then there’s the thorny issue of energy supplies. Austria has also been kicking the can on efforts to cut its reliance on Russian gas imports. OMV continues to buy Russian natural gas because it’s locked into a contract running until 2040. It covers more than half of Austrian gas demand via pipelines that cross Ukraine.

That has left the government in Vienna with an awkward balancing act. For Energy Minister Leonore Gewessler, the dilemma feeds into a broader discussion around Austria’s energy supplies. Gewessler, a Green Party politician, was dispatched to Kyiv earlier this year to sign deals Ukraine said would advance a long history of energy cooperation between the two countries.

“There are currently a lot of conversations going on,” said Gewessler, who is also part of a special commission studying Austria’s security strategy to incorporate energy supplies. “The return of conventional war in Europe necessitates that we rethink our security policy in broader terms.”

That’s opened the door for RAG Austria, one of Europe’s biggest gas-depot operators. The company is backing the so-called H2EU+Store project, which aims to build a hydrogen supply chain that connects Ukrainian renewable energy sources with pipelines feeding EU industry with clean-burning fuel. “Ukraine will play a fundamental role in the future,” the company said in a response to questions. DM 

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