October 2, 2023

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Ukraine Latest: Zelenskiy Says Russia Slowing Grain Export Pace

8 min read
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President Volodymyr Zelenskiy said Russia is deliberately slowing down exports of grain from Ukrainian ports in a bid to prolong a global food crisis, with more than 150 ships waiting to gain access to Black Sea ports.

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(Bloomberg) — President Volodymyr Zelenskiy said Russia is deliberately slowing down exports of grain from Ukrainian ports in a bid to prolong a global food crisis, with more than 150 ships waiting to gain access to Black Sea ports. 

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Iran may be sending more attack drones to help Russia’s equipment-starved forces strike targets in Ukraine, Secretary of State Antony Blinken said.

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Russian Defense Minister Sergei Shoigu discussed the war in Ukraine with US Secretary of Defense Lloyd Austin on Friday. It was the first announced call between the two since May. 

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

Key Developments

  • Blinken Says Iran May Be Sending More Drones to Russia
  • Ukraine Crop Deal Fears Boost Food Costs and Slow Shipments
  • IMF to Advance Monitoring Program Work as Ukraine Seeks Aid
  • Russia Threatens Flooding With Mined Dam, Zelenskiy Tells EU
  • Ukraine Grain and Dollar’s Threat to Food Security: Supply Lines

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On the Ground

Several Ukraine’s regions faced air-strikes from Russia tonight, as Kremlin continues to deliberately target civil infrastructure in big cities in a bid to change the course of the war that is nearing its ninth month. Russia’s troops hit a village in the southeastern Zaporizhzhia region, and shelled the Nikopol district in the Dnipropetrovsk region and the central Cherkasy region, according to local authorities’ social networks. Explosions were also heard in the Kmelnytskyi region in the Ukraine’s west and in other regions. Kharkiv, Ukraine’s second largest city, was also hit in past day, with 11 civilians injured as a result of Russia’s missile attack on an industrial facility, according to local governor.

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(All times CET)

Zelenskiy Blames Russia for Massive Grain Ship Backlog (8 a.m.) 

President Volodymyr Zelenskiy said Russia is attempting to undermine the safe-transit deal for three Black Sea ports it agreed to in late July and creating a backlog of “more than 150 ships” waiting to load wheat, corn and other products. 

“This is an artificial queue,” Zelenskiy said Friday in his nightly video address. “It arose only because Russia is deliberately delaying the passage of ships.”

Ukraine has shipped more than 8 million tons of farm products since August, but “under-exported” about 3 million tons because of the shipment delays, Zelenskiy said, estimating that at “the annual volume consumption of 10 million people.”  

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Read more: Ukraine Crop Deal Fears Boost Food Costs and Slow Shipments

Blinken Warns of More Iranian Drones on Battlefield (3:30 a.m.)

Blinken said more Iranian military drones may be on their way to Russian forces, as the US reiterated its condemnation of Tehran for aiding President Vladimir Putin’s invasion. 

“We believe that Russia’s received dozens of these UAVs so far from Iran, with more potentially in the works,” Blinken told reporters at a briefing alongside French Foreign Minister Catherine Colonna on Friday, referring to unmanned aerial vehicles. 

Blinken spoke a day after the White House accused Iran of sending trainers and technicians to Crimea to help advise and support Russian attacks on Ukrainian targets. He added that the US was working to counter Iran’s efforts and bolster Ukraine’s ability to ward off attacks.

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IMF, Ukraine Advance Work on Monitoring Program (4:48 p.m.)

The International Monetary Fund said it will “advance work” on a monitoring program with Ukraine as the government seeks to secure billions of dollars in aid after almost eight months of war. 

Andriy Pyshnyi, Ukraine’s new central bank governor, and Finance Minister Serhiy Marchenko held talks in Vienna this week with officials of the Washington-based lender.

Ukraine is seeking to borrow as much as $20 billion from the IMF to shore up its foreign reserves and budget as Russia’s invasion inflicts an economic contraction of more than 30% this year.

Infrastructure Aid Pouring in, Ukraine PM Tells Cabinet (4:30 p.m.)

The US has disbursed $55 million for the repair and maintenance of Ukraine’s gas pipelines, part of multinational aid after recent Russian attacks, Prime Minister Denys Shmyhal said. 

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Electrical power distribution equipment and parts are on the way from Belgium, Poland, Germany, Italy and other countries to Ukraine’s Ukrenergo, he said.

Separately, Shmyhal called for the UN, European Union and others to mount a monitoring mission to the occupied Kakhovska heating power plant, which Ukraine says has been mined by Russian forces ahead of a possible dam explosion on the Dnipro River above Kherson.  

Russian, US Defense Chiefs Speak for First Time Since May (3:22 p.m.)

Russian Defense Minister Sergei Shoigu discussed the Ukraine war and other global security issues with US counterpart Lloyd Austin, Tass said, citing the Russian Defense Ministry.

The brief report provided no other details of the phone call. In a separate readout, the Pentagon said Austin “emphasized the importance of maintaining lines of communication amid the ongoing war.” The US last announced a call between the two on May 13.

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Austin also spoke on Friday with Ukraine’s Defense Minister Oleksii Reznikov, the Pentagon said.  

EU Considers Naming Sanctions Envoy (3 p.m.) 

The European Union may name a senior official to serve as sanctions envoy to help the bloc counter efforts to circumvent its sanctions on Russia, said Commission President Ursula von der Leyen. 

“Our experience is that it is very helpful to send this sanctions envoy, for example, to third countries to be very clear about what we observe,” she said. 

In its most recent sanctions package, the bloc added a provision that authorizes sanctions on people and entities who send EU goods to Russia via third countries, an expansion of the EU’s reach that von der Leyen called “a very strong deterrent.”

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Ukraine Restores Infrastructure, Logs Crimes in Kharkiv, Kherson (3:08 p.m.)

Ukrainian law enforcement have recorded almost 1,700 cases of military crimes by Russian occupants in 551 liberated settlements in the Kharkiv region, Kyrylo Tymoshenko, deputy head of the presidential staff, said in a video statement. In 88 settlements already de-occupied in the Kherson region, 165 cases have been registered so far. 

Energy infrastructure and other critical services are being restored in both regions as thousands of civilian buildings and facilities were damaged by Russian attacks, especially. Liberated towns and villages in the Kharkiv region are being supplied with equipment for power generation and for heating, Tymoshenko said. 

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Zelenskiy Meets US Congress Delegation, EBRD Chief (2:30 p.m.)

Ukraine’s president met in Kyiv with three members of the US House Intelligence committee: Michael Turner of Ohio, the top-ranked Republican, and Jim Himes of Connecticut and Eric Swalwell of California, both Democrats. He repeated calls for more air defense to protect Ukrainian civilians and critical infrastructure from Russian attacks. 

Zelenskiy said the delegation showed bipartisan support for Ukraine, days after House GOP leader Kevin McCarthy appeared to cast doubt on future aid should Republicans gain the majority in November’s election. 

Zelenskiy also met with Odile Renaud-Basso, president of the European Bank for Reconstruction and Development. The pair discussed additional lending to Ukraine’s energy sector.   

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Musk Wades In on Ukraine Again (1 p.m.)

Elon Musk says hasn’t spoken with Vladimir Putin since the Russian president sent his troops into Ukraine. But the billionaire’s warm words for a satirical tweet from a top Kremlin official about departing UK Prime Minister Liz Truss drew him into an unusual back-and-forth over the war: Tweeting Praise for Putin Ally, Musk Wades In on Ukraine Again

Ukraine Power Grid Recovering, Data Suggest (11:20 a.m.)

Ukraine’s electricity grid showed signs of recovery after crews repaired infrastructure damaged by Russian attacks and households reduced the amount of power consumed.

Generation was exceeding demand by just 20 megawatts, equivalent to the amount of power two US homes consume in a year, according to the latest data published by the International Energy Agency. The shift into a positive balance on Friday from a deficit the day before could reduce the length and frequency of rolling blackouts.

Grid operator Ukrenergo warned consumers on Thursday to expect power outages between 7 a.m. and 10 p.m. after Russia’s missile barrage against infrastructure lamed power assets.



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