Ukraine 101:

• No significant developments.

West’s leverage over Russia:

• U.S. Secretary of State Rex Tillerson says Washington will ease sanctions against Russia over the conflict in Ukraine only when Moscow respects commitments to help restore peace. (AP, 03.31.17)

Russia’s leverage over West:

• Many analysts agree that the British withdrawal from the EU, and the uncertainty it produced, has been good news for Russia, and possibly for China, as two large powers that can exercise greater leverage in negotiations with individual European capitals than with a tightly unified European bloc that, taken together, is a geopolitical powerhouse. (New York Times , 03.29.17)
• France must curb its reliance on Russian and Ukrainian firms for its military support fleet to move troops and hardware to war zones, a French parliamentary report on March 28 found. The report's author said the reliance on Russian and Ukrainian operators was a "veritable Damocles sword" hanging over French forces and that Paris was vulnerable to deteriorating relations that "could totally paralyze its aerial deployment." In 2015, Flight Unit 224, a company linked to Russia's Defense Ministry, suspended its flights for France at the request of the Russian government as relations between the two countries cooled over the Ukrainian crisis. (Reuters, 03.28.17)

Russia’s leverage over Ukraine:

• Handing a victory to Russia in a protracted $3 billion debt conflict with Ukraine, London's High court ruled that a case brought by Moscow cannot proceed to a full trial as Kiev lacks a "justiciable defense." Justice Blair of the court noted that the aggression alleged by Ukraine or related breaches of international law have no connection with the specific dispute over debt repayment. Ukraine is expected to appeal the decision. (Bear Market Brief, 03.29.17, Financial Times, 03.29.17)
• Russian President Vladimir Putin has signed a law banning money transfers to Ukraine via foreign payment systems. Earlier Kiev banned money transfers to Russia that are conducted by Russian payment systems. (TASS, 04.04.17)

Casualties and costs for Russia, West and Ukraine:

• Wade Shepard, author of Ghost Cities of China, writes: “Russia’s reactionary sanctions were initially issued for one year in 2014, but have since been renewed twice—most recently last July, ensuring that they will remain in place at least until the end of 2017. Because of this, the newly emerging Southern Rail Corridor, which goes across the Caspian Sea and through Azerbaijan, Georgia and Turkey, completely bypassing Russia, is looking more and more attractive to EU agricultural producers and freight forwarders. (Forbes, 03.13.17)

Impact of Russia’s actions vis-à-vis Ukraine on other countries:

• No significant developments.

Red lines and tripwires:

• No significant developments.

Factors and scenarios that could cause resumption of large-scale hostilities or lead to accident between Western and Russian forces in Europe:

• Russia has developed the capability to launch an attack on the Baltic states with as little as 24 hours' notice, limiting NATO's options to respond, other than to have military forces already deployed in the region, Lithuania's intelligence service said on April 3. The Lithuanian intelligence service said in its annual threat assessment that Russia had upgraded its military in the Kaliningrad region last year, reducing lead times for any attack and potentially preventing NATO reinforcements. (Reuters, 04.03.17)

Arming and training of Ukrainian forces by Western countries:

• No significant developments.

Strategies and actions recommended:

• No significant developments.

Analysis:

• No significant developments.

Other important news:

• Ukrainian President Petro Poroshenko said last week that he had ordered the Ukrainian military to implement a cease-fire and weapons pullback in eastern Ukraine beginning on April 1. However, the sides continued to exchange fire on April 1-3. The OSCE Special Monitoring Mission to Ukraine recorded an increased number of cease-fire violations on April 2-April 3, including about 190 explosions, compared with 90 explosions April 1-April 2. Poroshenko blamed the violations on separatists. In comments made on April 4, he said the separatists have not observed the cease-fire regime for a single day since April 1. According to a separatist commander, however, the Ukrainian army shelled the territory of the self-proclaimed Donetsk People’s Republic. (RFE/RL , 03.30.17, OSCE, 04.04.17, Interfax, 04.04.17, TASS, 04.01.17)
• The Ukraine conflict dominated the first session of the Russia-NATO Council to be held this year. NATO Secretary-General Jens Stoltenberg called the March 30 meeting in Brussels "frank" and "constructive," but “not an easy dialogue,” adding that the two sides "continue to have clear disagreement" on Ukraine. “The allies do not and will not recognize Russia's illegal annexation of [the Ukrainian region of] Crimea,” Stoltenberg said. Russia's ambassador to NATO, Aleksandr Grushko, said "it is not possible to build confidence until NATO abandons its military-domination policy." (RFE/RL, 03.30.17)
• U.S. Secretary of State Rex Tillerson and Defense Secretary Jim Mattis stressed the importance of NATO and criticized Russia for aggression and meddling in other countries’ affairs, easing European allies’ concerns about U.S. President Donald Trump’s commitment to trans-Atlantic security. (Bloomberg , 03.31.17)
• Russia has accused the United States and its allies of "slander" as the U.S. top diplomat and Pentagon chief denounced Russia’s actions in Ukraine and elsewhere. "The U.S. and its allies are obsessed with building up their military presence on our borders, justifying it with the need to 'restrain Russia,'" the Russian Foreign Ministry said in a statement. (RFE/RL, 04.01.17)
• U.S. Sen. John McCain said that Russia's actions are “echoes of the Cold War. They just tell flat-out lies.” “They're succeeding in continuing their dismemberment of Ukraine, they're succeeding in exerting enormous influence in the Middle East, which they never had before,” McCain said. (The Washington Post, 03.02.17)
• Germany's far-left Linke party said on April 3 that NATO should be replaced by an alliance including Russia, called for an end to weapons exports as U.S. President Donald Trump urges more defense spending and demanded an end to German combat missions. The latest polls show the Linke on 8% support. (Reuters, 04.03.17)
• Russian Foreign Minister Sergei Lavrov on Ukraine: “On the Minsk agreements, I believe that the Ukrainian government and President Poroshenko personally want them dead. They want them dead in a way which would allow them to blame Russia and the people in the east of Ukraine. … People tend to forget, because they’re being brainwashed every day with very simple phrases like ‘Russia is aggressor in Ukraine,’ ‘annexation of Crimea’ and so on and so forth, instead of laboring your tongues, people should go there. Those who go to Crimea, see for themselves how the people live there, and they understand that all these hysterical voices about violation of human rights, about discrimination vis-à-vis Crimean Tatars, is a lie.” (The National Interest, 03.29.17)
• Ukraine's Tedis Ukraine tobacco giant has been accused of tax evasion and financing Russia-backed separatists that control parts of the eastern regions of Donetsk and Luhansk. (RFE/RL, 03.31.17)
• The International Monetary Fund urged Ukraine on April 3 to raise the pension age and do more to tackle corruption after announcing the payout of $1 billion in new aid to the war-torn country. (Reuters, 04.03.17)