Moscow is determined to retaliate against another Ukrainian long-range missile strike; Russian lawmakers move to lift the terrorist ban on the Taliban; and experts see a US-EU trade war as inevitable. These stories have topped Wednesday’s newspaper headlines across Russia.
Izvestia: Russia to retaliate against another Ukrainian long-range missile strike
Russia’s Defense Ministry is working on options to retaliate against strikes involving Western-made long-range weapons. Over the past three days, the Ukrainian armed forces have attacked Russia twice using such missiles. An attack on the Kursk Vostochny airfield left two service members lightly wounded; Russian air defenses downed seven out of eight missiles. Experts point out that this time, the Defense Ministry provided a detailed report and even showed pictures from the site where ATACMS missile fragments had fallen; such openness by the Russian defense agency does not bode well for the enemy, Izvestia notes.
"The enemy ignored our previous warning. It carried out a strike and did so on purpose, which means that the Western parties of the war are raising the stakes, increasing the degree of escalation. They want the conflict to reach a completely new level by January. This is being done with [US President-elect] Donald Trump’s peaceful rhetoric in mind," said Roman Shkurlatov, a retired lieutenant colonel and chairman of the Officers of Russia public organization. Western countries continue to climb the ladder of escalation, which could lead to a global catastrophe, military expert Alexey Leonkov stressed.
Meanwhile, on November 26, Kiev initiated an emergency meeting of the NATO-Ukraine Council at the level of envoys. The focus was on the consequences of Russia’s launch of its new ballistic missile, Oreshnik, against a Ukrainian defense facility in the city of Dnepr (formerly known as Dnepropetrovsk).
NATO is deeply concerned about the current situation because the West cannot accept Russia’s victory in the conflict, American historian and former Harvard University professor Vladimir Brovkin noted. "However, they will have to put up with it because, as far as I understand, there’s nothing they can do. Sending US troops [to Ukraine] would be unacceptable, especially since the US election has made it clear that people don’t want any more wars, and this is what Donald Trump’s election promises were about. If he opts for escalation, he will doom himself to ruin. As for the rest of NATO, it’s ridiculous. They have nothing to fight with. In particular, there are few combat-effective units in the United Kingdom. The German army is 175,000 strong, but the country has forgotten how to fight. The Polish army is the only capable one, but they won’t go against Russia, while NATO as a whole will not dare declare war on Russia or become seriously involved, as they don’t have the necessary resources. Moreover, civilians in Europe also oppose this scenario," Brovkin emphasized.
Vedomosti: Russian bill could lead to lifting terrorist ban on the Taliban
A bill has been submitted to the Russian State Duma (lower house of parliament) that suspends the ban on terrorist organizations, provided they cease their illegal activities. The initiative may mark a step toward removing the Taliban movement (designated as a terrorist organization and outlawed in Russia) from the list of banned organizations and recognizing its power in Afghanistan, Vedomosti reports.
Moscow is cautious about building relations with the Taliban because, in the past, it sometimes even escalated into a full-fledged confrontation, Stanislav Pritchin, deputy head of the Central Asia Department at the Russian Academy of Sciences’ Institute of World Economy and International Relations, asserted. Still, the risk of an increasing terrorist threat in the region dictates the need to intensify this kind of dialogue.
The bill was submitted on the day when a Russian delegation led by Security Council Secretary Sergey Shoigu visited Kabul. In talks, Shoigu pointed to the improving security situation in Afghanistan and expressed Moscow’s intention to continue boosting bilateral relations in all areas.
Moscow could provide the Afghan government with intelligence required for the fight against terrorists, as well as offer media assistance aimed at offsetting the propaganda spread by the Islamic State (designated as a terrorist organization and outlawed in Russia), Georgy Machitidze, senior research fellow with the Institute for International Studies at Moscow State Institute of International Relations, noted.
Machitidze believes that Russian companies are unlikely to invest in Afghanistan’s economic projects until the country resolves the security issue. Participation in regional transport projects would be the most beneficial for Russia, Pritchin maintained. "It will strengthen our country’s transport links with Central Asia, making it possible to build up trade with the countries of the region," he explained.
Vedomosti: Experts analyze the risk of a trade war between US, EU
A trade conflict between the United States and the European Union is becoming inevitable, said experts interviewed by Vedomosti. Some even do not rule out that it will escalate into an all-out trade war during Donald Trump’s second presidential term.
The likelihood of a trade war breaking out between the US and the EU in the coming years is increasing due to Trump’s promises to raise import tariffs, said Oksana Kholodenko, head of analytics and promotion at BCS World of Investment. She believes that the EU may take retaliatory measures, which will affect external trade and export-oriented countries. According to Kholodenko, there is a risk that the US move to raise import tariffs will increase turbulence on financial markets. However, Kholodenko does not rule out that Trump’s tariff scenario may not be implemented at all, simply because it will fail to pass approval procedures.
There won’t be a trade conflict in the usual sense between the US and Europe because it’s crucial for Trump to maintain a sort of equilibrium in relations with the EU amid a confrontation with China, said Alexander Abramov, head of a laboratory analyzing institutions and financial markets at the Institute of Applied Ethno-Political Research of the Russian Presidential Academy of National Economy and Public Administration. Still, some discord is definitely looming because, apart from other things, a rise in tariffs will change the dollar-to-euro ratio. On the one hand, a weakening national currency will boost exports, but on the other, it will reduce investment in Europe, the economist said.
The countries that own the technologies Washington needs will be the most susceptible in terms of confrontation with the US. The list includes Germany, France, and the Netherlands, Yekaterina Novikova, associate professor with the Economic Theory Department at the Plekhanov Russian University of Economics, specified.
The military-political aspect remains the cornerstone of the alliance between America and Europe, and it will not go anywhere amid the current international tensions, so there is no reason to expect a warming in relations with Russia, Sergey Shein, senior researcher with the Center for Comprehensive European and International Studies at the Higher School of Economics, emphasized. Novikova agrees that the EU could improve its challenging economic situation by acquiring cheap natural resources, but it will hardly approve a revival of cooperation with Moscow.
Rossiyskaya Gazeta: Middle East ceasefire could disrupt OPEC+ plans
Reports of a potential ceasefire between Israel and Lebanon caused Brent oil prices to fall from $75 to $73 per barrel. Meanwhile, an OPEC+ ministerial meeting will determine on December 1 what the member states will do next year, Rossiyskaya Gazeta notes.
OPEC+ has three options: to preserve the status quo, start to gradually decrease output cuts, or reduce oil production. At this point, most of the OPEC+ nations aren’t satisfied with the level of oil prices. Freedom Finance Global analyst Vladimir Chernov points out that a ceasefire agreement could sharply reduce the risk of disruptions in oil supplies to the market, which may force OPEC+ to once again change its plans to increase output, postponing them until better times.
According to energy expert Kirill Rodionov, the alliance will extend output cuts and take a break without changing the situation on the market in order to wait and see what new US President Donald Trump’s first steps will be. Media reports say that the president-elect has decided to nominate Scott Bassent to lead the Department of the Treasury, and the latter plans to increase the already record-high oil production in the US.
In Chernov’s view, OPEC+ countries may opt to further reduce oil output only if global prices plummet and remain at low levels for a long time. However, not all members of the OPEC+ deal will be willing to cut production further. That said, it’s possible that only some countries will have to reduce oil output and exports. Russia and Saudi Arabia are most interested in maintaining high oil prices, as a large share of their budget revenues comes from oil exports. However, there are currently no clear preconditions for an additional output cut by OPEC+ nations; on the contrary, they plan to raise production and are simply waiting for the right moment in terms of the situation on the global market, the expert said.
Izvestia: Russian currency weakens amid political tensions, US sanctions
The Russian national currency will remain at the 105-107 ruble per US dollar range until the end of the year, said experts interviewed by Izvestia. Meanwhile, the Moscow Exchange index has dropped below 2,500 points amid an escalation of the Ukraine conflict and new US sanctions on Russia. However, the Russian authorities don’t seem to be planning to stabilize the currency exchange rate because it benefits the Ministry of Finance, which has to deal with a budget shortfall.
The decline in the Moscow Exchange index and the ruble’s exchange rate stems primarily from rising geopolitical uncertainty, Tsifra Broker analyst Ivan Yefanov stated. New US sanctions have affected foreign payments, Freedom Finance Global analyst Vladimir Chernov pointed out. Restrictions against Gazprombank and other smaller players have reduced payment options for Russian gas importers. This is why Russia now receives less currency from commodity exports, and a currency shortage has emerged on the market, with the ruble falling by 5.6% against the dollar in just 3.5 trading days.
Finam analyst Alexander Potavin expects the Russian currency to hold at the 105-107 rubles per dollar level in the coming weeks. Later, the ruble-to-dollar exchange rate may return to the highs recorded in 2022, hitting the 121 rubles per dollar level. The only question is when that will happen, Finam experts remarked.
The triple-digit ruble/dollar exchange rate seems to be here to stay, Potavin concluded. However, the Kremlin is comfortable with a weakening national currency because it makes it easier to fill the budget with rubles, the expert stressed.
Russian exporters will benefit from a weaker national currency, while a rise in their revenues will help stabilize the country’s fiscal deficit, financial market expert at BCS World of Investments Mikhail Zeltser observed. This may offset the losses from declining exports, economist Andrey Barkhota added.
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