Expert on Russian election: The Kremlin will get mandate to ramp up wartime economy

Expert on Russian election: The Kremlin will get mandate to ramp up wartime economy The main purpose of Russia's elections is to demonstrate public support for the war. While the regime will ensure it gets the desired result on paper, a struggle over dwindling resources and the redistribution of assets is taking place behind closed doors, economic expert Raivo Vare told ERR. The U.S. president is blaming Ukraine for high fuel prices. Are diesel prices in America really rising because Zelenskyy is bombing Putin's diesel refineries? In fact, prices are rising primarily for other reasons, above all because of what is happening around the Strait of Hormuz. If we look at the impact of both wars on the petroleum products market, particularly the diesel market, there is an impact from Russian diesel as well. But the difference is severalfold in favor of Hormuz, meaning it accounts for a much larger share. A significant amount of diesel came through there, not just crude oil, and because the strait is now closed, there is a shortage. Naturally, that is driving up world market prices. There are also certain technical issues related to the fact that refineries usually undergo maintenance ahead of the fall season. So supply has fallen across the board and prices are going up. These are world market prices, which also affect the U.S. market. Freight transportation in the United States relies very heavily on diesel. Prices there have now started to climb and gasoline prices have followed to some extent. With the midterm elections approaching, this is causing problems for Republicans and Trump in particular. They are worried about it and Trump needs to find someone to blame. He obviously cannot blame himself for what happened in Hormuz, so someone else has to be at fault. And so Zelenskyy was singled out. Besides, Zelenskyy does not seem to have taken that request very seriously, considering what happened just last night when a large refinery near Moscow was hit. Exactly. And two other refineries had been hit before that. In fact, Zelenskyy has taken the right position because remember what preceded this: massive Russian attacks and bombardments. They targeted energy and utility infrastructure, as well as civilians and residential buildings. There is no reason to think that if the Russians continue their bombardment, Zelenskyy will agree to back down. Incidentally, there is one detail worth noting. Zelenskyy initially said, OK, let's do that, but please provide a list of what must not be bombed. The Russian side never provided such a list. Is the bombing of the oil refinery near Moscow also connected to the fact that it is election weekend in Russia? Is that a clear sign of why the bombs fell specifically there, given that Moscow is also seeing a record number of drone attacks? To some extent, yes. The Kapotnya refinery is a very accessible target once Moscow's surrounding air defenses have been breached. Because of its technical layout, it is even easier to bomb than some other refineries. The entire production infrastructure is built vertically rather than spread out as it is at other plants. That means that when it is hit, several things are struck at once — multiple pieces of industrial equipment needed to produce fuel, of which there are many in the refining process. As far as I understand it, the No. 6 primary processing unit was knocked out there. It processed 60 percent or more of all the crude oil handled by the refinery and only after that did the oil move on to other units that produce diesel or gasoline. So they physically have nothing to make those fuels from and shortages have already begun in Moscow. There are lines at gas stations and fuel is being rationed. Some gas stations have nothing left at all — even the signs that previously promised a limit of 20 liters at a time have been taken down. So the situation is serious. We will find out when the relevant equipment is brought back once it eventually arrives. Can anything in Russia's political situation change public sentiment? Could this have even a small impact on the election results? Look, Yabloko's removal from the election was connected to fears that too large a percentage of people would begin supporting its call to enter peace negotiations. The Kremlin's objective in organizing this vote, however, is to demonstrate support for the war. Turnout has already reached 53 percent, which is higher than last time, so the main objective — getting more than half of voters to participate — has been achieved. They will draw up whatever result and number of votes in favor they need as well. Since the objective has been achieved, they are quite relaxed about the fact that, for example, polling stations in Donetsk Oblast have been closed since 2 p.m. They are doing this because they are afraid the materials will not be processed at the polling stations before dark and Ukrainian drones come after dark. There are also lines in Moscow because the IT systems have gone down and electronic voter lists cannot be used to issue ballots. At the same time, Ella Pamfilova (chair of Russia's Central Election Commission — ed.) says everything is wonderful, tiptop and there are no problems whatsoever. That is Russia. I wonder how large the gap might be between Putin's actual support — what he really gets at the ballot box — and what we are later falsely told the result was? That is a question that should primarily be put to the FSO, the Presidential Security Service. They are the only ones conducting anything resembling credible sociological research in Russia. Everyone else receives false answers anyway and no one can say exactly what the true figure is. According to the latest polls before Yabloko was removed, nearly 60 percent of respondents thought Russia should enter peace negotiations, which gives us some indication. There are quite a lot of people who do want the war to end. Whether everyone who supports peace negotiations wants the war to end immediately is another matter, but at least some do and that share could be relatively large. The problem is that it is not large enough. The social conditions necessary for Russia to end the war do not yet exist. So even the fact that cars in Moscow, for example, may no longer have gasoline or diesel is not enough of an incentive? There is still something available somewhere, in one form or another. Problems will start in the larger cities once absolutely everything runs out. Not before then because people in Russia are generally accustomed to finding ways to obtain things from somewhere. It is ingrained in them from the Soviet era. We, on the other hand, have lost that habit and live in a society of abundance. Another question is whether, once this vote, election — or rather, show — is over, Putin will have reason to make changes within his ruling clique. Will we see a new and different prime minister and will anything change? We know Putin's modus operandi: Until the very last moment, no one fully understands what is going to happen. What is apparent, however, is that a decision has been made to move toward a scenario of strengthening the war economy. That will inevitably bring certain changes among the elite, in positions and among officeholders. On top of that, another process we have discussed before has begun to intensify: the redistribution of assets. Previously, Russian businesses had opportunities to expand around the world, while domestic competition remained relatively tolerable. Now, because of sanctions and restrictions, they can no longer expand. The stronger players are redistributing assets domestically and taking them away from all sorts of other players. One recent example was the major international corporation Nestlé whose assets were taken away. This redistribution is continuing and it will naturally lead to changes among the elites. There is currently a struggle underway within the FSB where changes are clearly taking place, though we do not know where they will lead. Initially, it appeared that the Rotenbergs were beginning to lose ground, but at the moment, the opposite has turned out to be the case. This is not the final state of affairs, so further changes are likely. That is not good news for us, however, because the entire process strengthens the war-economy faction. So should we abandon any hope or expectation that, even if the election goes Putin's way and everything is made to look right on paper, internal processes — such as this redistribution of assets — could turn into a conflict? That at some point a critical mass might emerge and say, "Comrade Putin, we don't want to play with you anymore"? It is still too early to expect that and a great deal depends on how the United States and Europe act and what happens on the Ukrainian front. The war of attrition will continue as winter approaches. The Russians are clearly hoping that this will enable them to put pressure on Ukraine and its allies, primarily by increasing war fatigue among them. Trump's sanctions — or, more precisely, the sanctions under the Graham legislation intended to apply pressure in negotiations — are certainly a useful stick. Whether he will actually impose them remains to be seen. I, for example, think he may not impose them or may apply them very selectively. Everyone forgets that, in addition to pressure related to the Russia-Ukraine war, those sanctions also include extending sanctions on Iran for five years. What is more, there is also an implicit confrontation with China. A meeting with Xi Jinping is expected at the U.N. General Assembly on September 24 and Trump will need leverage and bargaining chips there. These sanctions are very useful for that purpose as well. We do not perceive that connection because we look at things only from the European perspective, but Trump is actually playing a larger game. He could quite easily strike a deal in Asia and, in order to do so, choose not to strike one in Europe. Is Russia likely to carry out a mobilization in the near future? They have created the technical capability to do so. It depends on just one man — whether he gives the order or not. They are capable of mobilizing a significant number of people, although it would be technically difficult. They could more or less prepare 150,000 men by the end of the year and call up 300,000 in total. It could also be done gradually. My assumption is that, at least initially, they will not carry out a general mobilization. Instead, it will be done gradually, based on the decree issued in fall 2022. That is easy to do both legally and technically. By gradual, I mean people will be called up in batches. The prerequisites have been put in place: the borders have been closed and the registration system has been put in order. The only question now is whether it is necessary. I think there will be something resembling mobilization — even if they do not call it that, they will present it as mobilization in order to strengthen their position in the negotiations that are about to begin. Will Russian society accept that? We have already heard that there have been 1.5 million casualties on the battlefield. If another 300,000 men are added, and their life expectancy is unlikely to be particularly long considering the way the meat grinder consumes them, will Russian society accept those losses as well? As things stand, it still will. What is most surprising is that the relationship is not nearly as straightforward as even our experts here have understood it to be — that dissatisfaction is greater in the major cities and that is why there has been no mobilization there. Perhaps that will still happen, but the latest polls I have seen have tended to show that support in the major cities may actually be even higher because there are still plenty of men left there. The provinces, in fact, have already been swept relatively thoroughly and attitudes there may have begun to shift somewhat. In Russia, of course, only the major cities matter in determining what happens, not the provinces. -- Editor: Marcus Turovski, Johanna Alvin Source: "Ukraina stuudio"