December 22, 2023

Sitrep for Dec. 20-22, 2023 (as of 8:30 a.m. UTC+3)

Frontline Situation Update

According to the DeepState Ukrainian project, in the south of the Bakhmut direction, near Klishchiivka, Kurdiumivka and Andriivka, Russian forces are attempting to recapture positions lost during the Ukrainian summer offensive.

Ukrainian and Russian Strikes

On the night of Dec. 22, Russian forces attacked Kyiv with UAVs. As a result of a strike in the Solomianskyi district, a 26-story residential building was damaged: several apartments on the upper floors were partially destroyed, a fire started and two people were injured. In a video of the drone attack filmed by an eyewitness, the sound of an engine not typical for Shahed-type loitering munitions can be heard. It is also completely different from the sound of a cruise missile engine. It is worth noting that no sounds of air defense fire can be heard in the video.

Western Assistance

On the evening of Dec. 20, it was reported that the US Congress has finally gone on holiday recess and would resume its work on Jan. 9, 2024. Consequently, the decision on the allocation of aid to Ukraine will not be made this year. However, according to various sources, Ukraine still has somewhat of a financial cushion, which should be enough for 2 to 3 months.

Japan, which is still unwilling to directly supply weapons to Ukraine, may consider transferring Patriot surface-to-air missiles to replenish US Army reserves, which have been depleted by supplies to the Armed Forces of Ukraine. It is worth noting that South Korea had earlier made a decision regarding a similar circular exchange scheme for artillery ammunition.

The complicated situation regarding the provision of military aid to Ukraine has prompted increased discussions on seizing $300 billion worth of Russian assets frozen at the start of the war. According to the New York Times, citing high-ranking American and European officials, the US administration is pressing the UK, France, Germany, Italy, Canada and Japan to come up with a strategy by Feb. 24, the second anniversary of the invasion.

One of the strategies under consideration involves recognizing countries that supported the Ukrainian economy and armed forces as “injured” and “specially affected” by Russia’s aggression. In such a case, the blocked assets in these countries would be transferred to Kyiv through either the World Bank or the European Bank for Reconstruction and Development.

However, the Financial Times also states that while US officials believe such a "countermeasure" may "induce Russia to end its aggression," they do not publicly support the transfer of Russian assets. This poses a legal risk, as the frozen reserves of the Central Bank of the Russian Federation are protected by international law. Any action taken against them could signal countries like China or Saudi Arabia that their assets held in euros or dollars might not always be safe.

The German Prosecutor General's Office is seeking the confiscation of Russian assets worth €720 million, deposited by the Moscow Exchange in the National Settlement Depository, which was sanctioned in 2022. Consequently, €720 million held in a bank in Frankfurt have been subject to restrictive measures. Once this was announced, NSD representatives attempted to withdraw the funds, but to no avail. The German Prosecutor General's Office regards these actions as an attempt to circumvent sanctions, providing a formal reason to confiscate assets.

Ukraine's Minister for Strategic Industries Oleksandr Kamyshin, confirming Ukraine's intention to produce one million FPV drones in 2024, reported that the Ukrainian industry had already produced over 50 thousand FPV drones in December 2023.

Reports are emerging showing the construction of full-profile trenches and dugouts, possibly on the Ukrainian side of the Belarusian-Ukrainian border. It is hoped that similar construction work is not only occurring on the northern border but also in all directions where combat operations are taking place.

Vazhnyye Istorii [IStories, independent Russian investigative media outlet] has, in collaboration with OCCRP and Vlast.kz, released a joint investigation into the supply of cotton cellulose from Kazakhstan and Uzbekistan to Russia. In 2022, the trade volume increased from 4 to 10 million dollars. Cellulose is not only used in the production of paints and lacquers but also in artillery powder. Kazakhstan and Uzbekistan have maintained a neutral stance on the war in Ukraine and pledged not to assist Russia in evading sanctions. However, officials have been deflecting responsibility in response to investigators’ inquiries. For instance, the Ministry of Foreign Affairs of Kazakhstan stated that the supply of cotton cellulose to Russia falls outside of its competence, while the Ministry of Trade and Integration recommended reaching out to the Ministry of Industry and Construction. Uzbek officials did not immediately respond to requests. Producers of cotton cellulose have claimed they comply with the law and do not trade in sanctioned goods. Russian importers are not currently sanctioned; they legally purchase cellulose and subsequently sell it to sanctioned artillery powder manufacturing plants.

We believe that even if it were possible to completely stop the import of cotton cellulose from Kazakhstan and Uzbekistan, it would not significantly impact Russia’s ability to produce artillery shells. The USSR mastered the production of wood-based artillery powders in the late 1930s, and while wood, unlike cotton, requires a purification stage to obtain cellulose, it remains a relatively simple manufacturing process, and all the necessary components to implement it are produced domestically in Russia. Therefore, in the event of sanctions interrupting the supply of inexpensive cotton cellulose, Russian plants should be able to switch to using wood-based cellulose, albeit at a presumably higher cost. In any case, the scale of powder production is currently constrained by the capacity of manufacturing plants rather than the availability of raw materials.

Journalist Farida Rustamova, citing her sources, reports that in 2024, Russian federal authorities plan to recruit approximately 400,000 more contract soldiers. According to her source, regional authorities have already received a contract soldier recruitment plan that "will be similar to what it was this year, or slightly less, but definitely not more."

In our opinion, Russia did not recruit 400,000 contract soldiers this year, and it will likely be impossible to do so next year as well. Based on statements from regional officials and military commissars, we estimate that in 2023, 150-160 thousand contract soldiers were recruited. Perhaps in 2024, an additional 100 thousand people could be recruited, such as individuals who committed crimes or are unable to repay loans.

Moreover, in Russia, many formal procedures, such as deregistration or obtaining a passport, are linked to the draft office, and men are persuaded to go to war during each visit. Sometimes this happens illegally; for example, in the Orenburg region, Aleksey Kostin, a mobilized soldiers who was recently buried in his hometown, had bought an apartment in Samara in 2021 and returned to his hometown of Abdulino in the fall of 2022 to be deregistered from military service, but was immediately sent to the frontline without undergoing a medical evaluation. Now, Kostin's parents cannot receive the payments they are entitled to because the Abdullino draft office claims he was registered in Samara, and the Samara military commissariat did not actually mobilize him.

It was uncovered that in the widely publicized incident of an ice block falling on people near the draft office in Lyubertsy, Moscow region, those waiting in line were individuals who came for military registration and did not wish to voluntarily go to the frontline.

President Putin instructed the Ministry of Defense and MinTsifry [the Ministry of Digital Development, Communications and Mass Media] to use the unified register of Russians subject to military service, originally planned to be launched in 2025, during the 2024 fall conscription campaign. We assume that using this registry, it will be technically possible to conduct a new wave of mobilization instead of conscription next fall.