Ukraine Latest: Russia Seeks to Annex Occupied Territory

(Bloomberg) --

Russia is focused on cementing both military and political control over the territory it has taken so far in Ukraine after nearly ten weeks into the war and troops making only marginal gains in the east. 

President Volodymyr Zelenskiy said Ukraine’s forces aren’t retreating and are even gaining some ground. But Russia also expanded the reach of its missile strikes, targeting Ukraine’s westernmost region. 

President Joe Biden stressed the importance of U.S. and allied weapons for Ukraine’s defense with a visit to a Lockheed Martin Corp. plant making Javelin anti-tank missiles, which American and NATO officials say have mauled Russia’s invading armored columns.

(See RSAN on the Bloomberg Terminal for the Russian Sanctions Dashboard.)

Key Developments

• Russia Seeks to Annex Occupied Ukraine as Invasion Goals Shift
• Draghi Calls for Tighter EU Integration to Face War, Energy Gaps
• Tank-Busting Javelins Win Biden Praise on Tour of Alabama Plant
• War Threatens Loss of ‘Intergenerational Heritage’ in Ukraine
• Russia Dodges Default for Now as Investors Get Dollar Funds 

All times CET: 

Oil Rebounds Toward $104 as Investors Weigh Inventory (6:07 a.m.)

Oil rose as industry data pointed to a drop in U.S. stockpiles and traders monitored possible European Union curbs on Russian crude.

The U.S. and U.K. have already moved to ban Russian crude, and there’s pressure for the European Union to follow suit, especially after Moscow choked off natural gas supplies to Poland and Bulgaria. Officials in the bloc are in the process of framing a fresh package of sanctions against Moscow.

Asia’s key coal price extended gains as earlier moves by the European Union and Japan to ban Russian cargoes have tightened the market

Australia Imposes Sanctions on Separatists in Ukraine, Russian Lawmakers (3:22 a.m.)

Australia has expanded targeted financial sanctions and travel bans on a further 110 people, including Ukrainian separatists and Russian members of parliament. The measures target 34 senior members of the Russian-led movements in Donetsk and Luhansk and 76 lawmakers of the state Duma. 

Zelenskiy Reports on Mariupol Evacuation (1:01 a.m.)

In his nightly video address, Zelenskiy discussed the evacuation from the besieged steel works in Mariupol. “We finally have the result, the first result, of our evacuation operation,” he said. “It took a lot of effort, long negotiations and various mediations. Today 156 people arrived in Zaporizhzhia.”

Russia Intends to Annex Occupied Parts of Ukraine (11:14 p.m.) 

The Kremlin is installing occupation governments, ordering locals to use rubles for transactions and, according to three people involved in the efforts, planning hastily organized referendums in some areas to open the way for full annexation. The people spoke on condition of anonymity given the risk of retribution discussing sensitive information. The Kremlin did not respond immediately to a request for comment.

Though far short of President Vladimir Putin’s original aims of ousting President Volodymyr Zelenskiy and installing a pro-Russian regime in most of Ukraine, the latest efforts pose a new obstacle for already-stalled peace talks, in which Kyiv has insisted Russia give up the ground it has taken since invading on Feb. 24. Zelenskiy’s military, backed by infusions of heavy weapons from the U.S. and its allies, plans a push to retake territory.

Biden Praises Impact of Javelins on War Effort (9:47 p.m.)

President Joe Biden pressed Congress to quickly approve his request for $33 billion in additional aid for Ukraine during visit to a Lockheed Martin Corp. factory that makes Javelin anti-tank missiles. 

“We need more money to make sure the United States can continue to send weapons directly to the front lines of freedom in Ukraine,” Biden said during a tour of the Troy, Alabama, factory. Biden praised the anti-tank systems as “some of the best, most effective weapons in our arsenal.”

“You’re making a gigantic difference for these poor sons of guns under such enormous crushing firepower,” Biden said.

Russia Dodges Default for Now as Investors Get Dollar Funds (9:40 p.m.)

Russia’s closely watched dollar payments on two bonds are trickling through to investors after the country dipped into its local holdings of the U.S. currency and sidestepped its first foreign default in a century. The transfer of the $650 million had got tangled up in the wide-ranging sanctions imposed after the invasion of Ukraine. 

Three investors said their custodian banks had received payments, asking not to be identified discussing private transactions. Major international clearinghouses have received and processed payments for the eurobonds due in 2022 and 2042, according to people familiar with the situation.

Ukraine Says Russian Missile Hit Westernmost Region (9:32 p.m.)

Ukraine said a Russian missile hit the western region of Zakarpattya for the first time since the war started, expanding the reach of Russian strikes to an area bordering EU and NATO members Hungary and Slovakia.

Zakarpattya’s government reported the strike on its Telegram channel, without giving details on possible casualties. The region is separated from the rest of the country by the Carpathian mountains and has remained relatively peaceful since Russia invaded Ukraine Feb. 24.

Zelenskiy Says Ukraine Is Gaining Some Ground (8:40 p.m.)

Ukraine isn’t retreating and is even gaining some ground in its fight against the Russian invasion, Zelenskiy told the Wall Street Journal in a video interview from Kyiv. 

But he added his country could use “a breather” through a cease-fire, which he said would be possible only if Putin agreed to a personal meeting with him. Zelenskiy reiterated Ukraine’s desire to get Crimea back from Russia even as he acknowledged that it’s not possible to get “everything immediately.”

China Media Picks up Article Praising Zelenskiy, Calling War Invasion (8:15 p.m.)

China’s Xinhua News Agency summarized an article written by Spain’s El País that described the Ukrainian president as a strong leader for his handling of the war in his country.

Notably, Xinhua used the Chinese word for “invaded” in reference to Russia’s war. Government officials and media outlets alike have called the fighting in Ukraine a conflict, crisis or “situation,” refraining from labeling Moscow’s actions an invasion. Xinhua included words like invasion and aggression when publishing an interview with Ukrainian Foreign Minister Dmytro Kuleba on April 30, but didn’t itself describe the war as such.

Still, Beijing hasn’t condemned Russia since the war started, even as it issued statements supporting Ukraine’s sovereignty and expressed concern about civilian casualties. China has also repeatedly accused the U.S. of provoking Russia by encouraging the expansion of NATO.

U.S. Plans to Focus on Ukraine, Food Security at UN (7:39 p.m.)

The U.S. took the rotating one-month presidency of the United Nations Security Council vowing to use its leadership to keep international attention focused on Russia’s war in Ukraine, including the conflict’s impact on food security around the world.

Secretary of State Antony Blinken will lead a Security Council meeting on food security on May 19, Ambassador Linda Thomas-Greenfield told reporters. This week, Secretary-General Antonio Guterres will open a council meeting on the situation in Ukraine, the U.S. envoy said.

Austin Confirms U.S. Is Providing Intelligence to Ukraine (6:28 p.m)

The U.S. and its allies are providing additional intelligence -- as well as artillery, tanks and drones -- to Ukrainian troops as Russia continues its military operations in the eastern and southern parts of the country, Defense Secretary Lloyd Austin said.

If Putin issues a formal declaration of war, Austin told a Senate panel, he “will be able to mobilize more people,” but the conscripts will be poorly trained and plagued by difficulties with logistics and leadership. Austin also predicted a strong international reaction if Putin uses cyber or chemical weapons.

Macron Urged Putin to Stop ‘Devastating Aggression’ (6:01 p.m.)

The French president also demanded that Putin implement a cease-fire, the Elysee palace said in a statement after the call, which happened at Macron’s request. Macron has always defended his strategy to continue talking to both Putin and Ukraine’s Volodymyr Zelenskiy as a way to keep diplomatic efforts alive.

NASA Chief Says Russia Caused ‘Misleading Headlines’ About ISS (5:55 p.m.)

Russia isn’t planning to withdraw from its partnership in the International Space Station despite recent rhetoric from the nation’s space agency, NASA Administrator Bill Nelson told a Senate hearing.

Over the weekend, Roscosmos director Dmitry Rogozin suggested Russia had decided to quit the orbital laboratory and would give its ISS partners a year’s notice of such a decision, according to Russian media reports. Nelson said Tuesday the comments sparked “misleading headlines” indicating that Russia would leave the station, which uses Russian cargo vessels to provide altitude changes. 

Read more. 

Azovstal Evacuees Went Through ‘Hell,’ UN Says (5:40 p.m.)

People evacuated from Azovstal underground shelter in Mariupol have reached Zaporizhzhia, Osnat Lubrani, UN resident coordinator and humanitarian coordinator in Ukraine, said on Twitter. “The people I traveled with told me heartbreaking stories of the hell they went through,” she said. 

Ukraine Accuses Russia of Taking Grain (4:55 p.m.)

Russian troops have confiscated 400,000 tons of grains from areas in Ukraine that they seized, Ukraine’s Agriculture Ministry said in a statement on its website, citing Deputy Minister Taras Vysotskyi.

Russia’s invasion has shut most of Ukraine’s ports and curtailed planting in one of the world’s biggest grain and vegetable oil suppliers. That’s dealt a huge blow to its agricultural sector, which typically ships about 5 million to 6 million tons of grain each month for Asia, Africa and Europe, fanning concerns of a worsening global hunger crisis.

Putin and Macron Discuss Mariupol in Call (4:24 p.m.)

The Russian president and his French counterpart exchanged opinions on Ukraine, according to a readout from the Kremlin. It said that Putin informed Macron of Russia’s “special military operation,” and of the evacuation of civilians from Azovstal.

The French side raised the issue of global food security, according to the Kremlin, adding Putin congratulated Macron on his recent election win. The call went for more than two hours. 

Germany Mulls Sending Kyiv Rapid-Fire Howitzers (4:15 p.m.)

Germany is considering sending seven rapid-fire artillery systems to Ukraine in what would be another step in Berlin’s efforts to bolster Kyiv’s ability to fend off Russian forces with heavy weaponry.

Defense Minister Christine Lambrecht has recommended delivery of the PzH 2000 -- a self-propelled, armored howitzer -- but Chancellor Olaf Scholz hasn’t granted final approval, according to officials familiar with the matter. German capabilities have been hampered by years of underfunding, and military leaders have warned that sending howitzers could weaken the country’s defenses.

Basketball Star Griner ‘Wrongfully Detained’ in Russia: ESPN (4 p.m.)

The U.S. State Department has now classified American women’s basketball start Brittney Griner as being “wrongfully detained” in Russia following her arrest some two months ago, ESPN reported, citing an email from a State Department official. 

Griner’s arrest first became public on March 5, when Russian authorities said she’d been taken into custody at Moscow’s airport for allegedly smuggling cannabis oil while attempting to return home to the U.S. Read more here.

Azovstal Defenders Say Russia Is Storming Plant (3:35 p.m.)

Ukrainian forces trapped in the Azovstal steel plant in Mariupol are facing a Russian assault, they said on social networks. A leader of the defenders, Sviatoslav Palamar, said in a video posted on Telegram that Russian troops were storming the plant after heavy shelling in which two civilians died. He called on the Ukrainian government to rescue people trapped in the facility.

Modi Urged to Prod Russia on War (2:49 p.m.)

Denmark’s Prime Minister Mette Frederiksen, speaking at a joint media event with her Indian counterpart, Narendra Modi, said she hoped India will influence Russia to end the invasion of Ukraine. 

Denmark “strongly condemns Russia” and Putin “has to stop the war,” Frederiksen said in Copenhagen. Modi said that India appealed for an “immediate cease-fire in Ukraine and for diplomacy to solve the conflict.” 

India buys most of its weapons from Russia and has yet to condemn the Kremlin for its invasion of Ukraine. 

U.K. to Supply Ukraine Until Goals Met: Johnson (1:50 p.m.) 

The U.K. will send Brimstone anti-ship missiles and Stormer anti-aircraft systems to Ukraine in the coming weeks, Prime Minister Boris Johnson said in an address to the parliament in Kyiv. He reiterated the U.K.’s 300 million-pound ($376 million) package of support, including radars, heavy-lift drones and thousands of night vision devices.

“We will carry on supplying Ukraine, alongside your other friends, with weapons, funding and humanitarian a

id, until we have achieved our long-term goal, which must be so to fortify Ukraine that no one will ever dare to attack you again,” Johnson said.

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