The West has failed to convince Russian President Vladimir Putin to reevaluate his theory of victory in Ukraine in the past year. Putin's public statements indicate that he continues to assess that Russian forces will be able to win a war of attrition by sustaining gradual advances along the frontline indefinitely. Putin articulated a theory of victory during the St. Petersburg International Economic Forum (SPIEF) in June 2024 that assumes that Russian forces will be able to continue gradual creeping advances indefinitely, prevent Ukraine from conducting successful operationally significant counteroffensive operations, and win a war of attrition against Ukrainian forces.[1] Putin's assessment that gradual Russian gains will allow Russia to achieve his goals in Ukraine is predicated on the assumption that Ukrainian forces will be unable to liberate any significant territory that Russian forces seize and that the Russian military will be able to sustain offensive operations that achieve gradual tactical gains regardless of heavy losses. Putin's discussion with foreign media at SPIEF on June 19, 2025, demonstrated that Putin still maintains this theory of victory one year later.[2] Putin claimed that Russian forces have a “strategic advantage” in all areas of the front. Putin claimed that Russian forces are advancing along the entire frontline every day and that even if Russian forces advance less on some days, they are “still advancing.” Putin claimed that the “situation has changed” since the March 2022 Ukrainian-Russian negotiations in Istanbul and that the terms Russia proposed in 2022 are “much softer” than the terms Russia demands today. Putin threatened that the situation may worsen for Ukraine if Ukraine does not make significant concessions and agree to a peace settlement on Russia's terms and called on Ukraine's partners to “point to the realities of today” to push Ukraine toward a settlement. Putin reiterated that Russia is prepared to achieve its war goals militarily if it is not able to achieve these goals diplomatically. Putin has repeatedly indicated that Russia's war aims include regime change in Ukraine, the installation of a pro-Kremlin proxy government in Kyiv, significant limitations of Ukraine's ability to defend itself against future Russian aggression, Ukrainian neutrality, and NATO's abandonment of its open-door policy.[3]
Other Kremlin officials also rearticulated Putin's theory of victory on June 19. Kremlin Spokesperson Dmitry Peskov responded to a question in a June 19 interview with Kremlin-affiliated outlet Izvestia about what Russia should do since “international institutions do not work” and diplomacy fails to meet Russia's expectations of ensuring peace on Russia's terms.[4] Peskov claimed that Russia must be patient and take a “consistent” position — a call for Russia to not waver from its long-held demands as time will produce Russia's desired outcome. Kherson Oblast occupation head Vladimir Saldo similarly claimed on June 19 that “Russia is a country with which is better not to fight because time...is on [Russia's] side.”[5]
Putin's theory of victory is predicated on critical assumptions about Ukraine's capabilities and continued Western support for Ukraine — conditions that the West can still change. Putin's theory assumes that Russian forces will be able to leverage their advantages in manpower and materiel to overwhelm Ukrainian forces and that Ukrainian forces will be unable to liberate any operationally- or strategically-significant territory that Russian forces seize.[6] Russian forces are taking disproportionately large manpower losses for marginal tactical gains that are unsustainable in the medium- to long-term, but Putin's theory assumes that the Russian military will be able to maintain the theater-wide initiative and sustain offensive operations that achieve gradual tactical gains longer than the West is willing to provide security assistance to Ukraine and longer than Ukraine's economy and population are able to mobilize for the war effort. ISW continues to assess that Russia will face a number of challenges in its economy and defense industrial base (DIB) in the medium-term that will impede Russia's ability to sustain a prolonged war in Ukraine.[7] Continued rising oil prices following Israeli strikes against Iran may increase Russian revenue from oil sales and improve Russia's ability to sustain its war effort, but only if the price of oil remains high and if Russian oil does not come under additional international sanctions.[8] Increased Western military aid and economic instruments can enable Ukrainian forces to maintain pressure on the battlefield and exacerbate Russia's economic issues, leveraging Russia's weaknesses to achieve a strong negotiating position for Ukraine and the West and extract critical concessions from Russia to bring about a lasting and just end to the war.
Putin continued Russia's reflexive control campaign that aims to deter Western provisions of military aid to Ukraine and NATO rearmament but appears to be adapting this campaign for different audiences. Putin claimed during his June 19 meeting with foreign journalists at SPIEF that Russia does not consider NATO rearmament (in line with US President Donald Trump's objective for Europe to shoulder more of the burden for collective security) to be a threat as Russia is able to ensure its own security and is constantly improving the Russian military and Russia's defensive capabilities.[9] Putin claimed that “whatever NATO does” will create threats, but that Russia will suppress all the threats that arise. Putin claimed that the idea that Russia is going to attack NATO states in Europe is “nonsense” - despite Kremlin statements threatening the Baltic states and Finland and Russian military preparations for a conflict with NATO in the future.[10] Putin also claimed during the June 19 meeting that Germany's possible supply of Taurus missiles to Ukraine will not impact the course of military operations in Ukraine but will cause “serious damage” to German-Russian relations.[11] Kremlin officials have made similar demonstrably untrue claims about Western weapons’ inability to change the situation on the battlefield in the past.[12]
Putin's statements are part of the Kremlin's ongoing reflexive control campaign that aims to push the West to make decisions that benefit Russia, such as by refraining from providing further assistance to Ukraine or stopping efforts to increase NATO's defensive capabilities.[13] Putin's claims about Taurus missiles and threats from NATO differ from previous Kremlin statements along these lines, however. Kremlin officials have recently framed European efforts to increase their defense capabilities as a threat to Russian national security, in contrast to Putin's June 19 claim.[14] Putin used his June 2024 meeting with foreign journalists at SPIEF to threaten that Russia might supply long-range weapons to unspecified Western adversaries to try to push the West to not lift restrictions on Ukraine's use of Western-provided weapons to strike military targets in Russia — a more direct and aggressive threat than Putin's June 2025 claims that Germany's supply of weapons to Ukraine would damage bilateral German-Russian relations.[15] Putin may be trying different variations of Russia's wider reflexive control campaign that cater specifically to new audiences.
Putin explicitly stated that he will not sign a peace agreement with Ukrainian President Volodymyr Zelensky. Putin stated that he is willing to negotiate with Zelensky but claimed that Zelensky is illegitimate and that Russia will only sign legal agreements with “legitimate” authorities.[16] Putin reiterated his false claims that there is no legal mechanism in the Ukrainian Constitution or law to extend the term of a Ukrainian president under martial law, and Putin deliberately misrepresented the Ukrainian Constitution and law to bolster his claims. Putin also claimed that all Zelensky-appointed Ukrainian government bodies are illegitimate, alleging that if the president is illegitimate then “the entire system of power becomes illegitimate.” Ukraine's Constitution and Ukrainian law explicitly state that Ukraine cannot hold elections while martial law is in place and that Ukrainian authorities cannot lift martial law while “the threat of attack or danger to the state independence of Ukraine and its territorial integrity” remains.[17] Putin's recent statement that he is willing to negotiate with Zelensky is meaningless as Putin indicated that he will not sign a legal peace agreement with the Ukrainian government. Putin and other Kremlin officials have frequently and falsely accused Zelensky and other facets of the Ukrainian government of being illegitimate with this misrepresentation of Ukrainian law since May 2024, and the Kremlin has described every Ukrainian government since 2014 as illegitimate.[18] Russian officials have occasionally proposed other Ukrainian officials and entities are possible legitimate authorities with which Russia can legally negotiate and sign a peace agreement, but Putin's statement accusing the whole government under Zelensky of also being illegitimate suggests that Russia would also not recognize an agreement signed by any member of the current Ukrainian government.[19] ISW continues to assess that these information operations are part of an effort to set informational conditions for Russia to renege on any future peace agreement Russia may sign with Ukraine at a time of Russia's choosing.[20]
Russian officials appear to be struggling to posture Russia's economic strength amid increasing signs of a slowing Russian economy. Russian Central Bank Chairperson Elvira Nabiullina stated at SPIEF on June 19 that Russia's economy grew at a high rate for two years because Russia was using “free resources,” including Russia's workforce, production capacity, import substitution, the liquid assets of the National Welfare Fund, and the banking system's capital reserve.[25] Nabiullina stated that Russia has exhausted many of these resources and needs to think of a new growth model. Russian Finance Minister Anton Siluanov acknowledged that the Russian economy is “cooling,” but claimed that more positive trends are on the horizon and that Russia's current economic model is working.[26] The Moscow Times claimed that, according to Russia's Federal State Statistics Service (Rosstat), Russia's unemployment rate has dropped to a historic low of just 2.3 percent and that mass emigration and military drafting of men have exacerbated labor shortages.[27] The Moscow Times further noted that, according to Rosstat, the liquid assets of Russia's sovereign wealth fund has decreased threefold to 2.8 trillion rubles (roughly $35.7 billion) since Russia's full-scale invasion of Ukraine.[28] Russia's Minister of Economic Development Maxim Reshetnikov stated that Russia is on the “brink of recession” and noted that Russia's strict monetary policy is hindering the ability of industries outside of the defense industrial base (DIB) to attract investments.[29] ISW observed recent reporting that the Kremlin is trying to promote social optimism at SPIEF rather than its traditional focus on foreign investment, and Russian official statements about Russian economic issues are complicating these efforts.[30] These Russian economic officials may be attempting to temper some of the Kremlin's expectation-setting among domestic Russian audiences about the impacts of a prolonged war effort in Ukraine without completely contradicting official Kremlin rhetoric that Russia can wage protracted war against Ukraine indefinitely.
more + maps https://www.understandingwar.org/backgrounder/russian-offensive-campaign-assessment-june-19-2025
“...amid increasing signs of a slowing Russian economy. Russian Central Bank Chairperson Elvira Nabiullina stated at SPIEF on June 19 that Russia’s economy grew at a high rate for two years because Russia was using “free resources,” (slack capacity) including Russia’s workforce, production capacity, import substitution, the liquid assets of the National Welfare Fund, and the banking system’s capital reserve. Nabiullina stated that Russia has exhausted many of these resources and needs to think of a new growth model.”
Putting more Russians to work cannot add much more to growth. According to the state statistics agency Rosstat, Unemployment is already down to a historic low of 2.3%. Mass emigration and the Ukraine meatgrinder have created a 2 million person labor shortage. Pretty much no slack left there.
Industrial capacity utilization has already surged beyond 80%, the highest in modern Russian history. The Central Bank sees little prospect that it can feasibly go much higher.
The liquid assets of the National Wealth Fund have been spent down throughout this war, and not enough remain to on spending as they have for another year. They can’t even go until it is zero, because they need to pay their pension obligations first, before they can use the remainder for general budgetary purposes. No more withdrawals from savings - that has played out too.
The capital reserves of the banking system (off of the Government’s books), has actually funded the bulk of the war year’s economic growth, not only have Russian banks already leveraged themselves to the hilt (and beyond, with loosened reserve requirements), but the quality of those loans has also plummeted, rapidly going bad, as bankruptcies swell. Not only can they not add to growth the way they have been, but they will likely require a massive bailout, with money that the Government does not have.
The engines that have been driving whatever real economic output increases that they have seen since the war started, have all run their course. They will likely print more money, which will kind of look like more things are happening, but they will essentially just be paying more for it.
Russian President Vladimir Putin claimed that Russians and Ukrainians are one nation and all of Ukraine is effectively Russian as part of efforts to justify his continued conquest of Ukraine. Putin answered a question after his speech at the St. Petersburg International Economic Forum (SPIEF) on June 20 about why Russian forces are advancing beyond the territories in Ukraine that Russia has illegally annexed, claiming that he considers Russian and Ukrainian people to be “one people in reality” and that “Ukraine is [Russia's].”[1] Putin has repeatedly demonstrated that he does not consider Ukraine as an independent state with its own history, identity, and culture separate from Russia, as evidenced by his 2021 “On the Historical Unity of Russians and Ukrainians” essay and his repeated false assertion that Russians, Belarusians, and Ukrainians are all part of one historical people.[2]
ISW has previously noted that the Kremlin's ongoing information operation attempting to portray Russians and Ukrainians as one unified nation and culturally and historically homogeneous is one of its most significant information operations aimed at undermining Western support for Ukraine and justifying the war effort to the Russian people. Putin's commitment to this narrative underscores his ongoing commitment to destroying the Ukrainian state and subjugating the Ukrainian people.[3]
Putin asserted that Russia will be able to achieve its goals through a protracted war in Ukraine. Putin claimed on June 20 that it would be better for Ukraine to stop fighting because the battlefield and geopolitical situation will only worsen for Ukraine, and that Ukraine will have to negotiate from a weaker position.[4] Putin attempted to posture Russia as interested in engaging in negotiations to end the war, claiming that Russia is not seeking “Ukrainian capitulation,” yet insisted that Ukraine recognize the “realities that have developed on the ground.”[5] Kremlin officials often call for Ukraine to recognize the “realities on the ground” (a reference to the frontline in Ukraine) to allude to the idea that Russia is in a stronger negotiating position given the situation on the battlefield and to demand that Ukraine concede to Russia's unwavering demands.[6]
Putin's claim that Ukraine must recognize the “realities on the ground” and should negotiate before the situation worsens also coheres with Putin's theory of victory, which assesses that Russian forces will be able to win a war of attrition by indefinitely sustaining gradual advances along the frontline despite the high costs of such creeping advances.[7] Putin's statement ignores that the true “realities on the ground” show a complicated and hotly contested frontline situation in which Russian forces are slowly making marginal advances at the cost of significant manpower and materiel losses in the face of significant Ukrainian drone-based defenses.
The Kremlin continues to prioritize maintaining the facade of economic stability by pursuing economic policies that will likely exacerbate Russia's economic instability. Putin claimed during SPIEF on June 20 that Russia's debt is not growing and refuted claims that Russia's economy is declining.[15] Putin claimed that the idea that Russia's economy is only tied to raw materials and is dependent on hydrocarbon exports is “outdated,” but that Russia aims to increase its non-oil and gas exports.[16] Putin claimed that inflation in Russia decreased to 9.6 percent as of June 16 and that he expects inflation to fall to seven percent by the end of 2025.[17] Putin used his speech to focus on reductions in the poverty level in Russia.[18] Putin also highlighted Russia's low unemployment rate, claiming that the rate has stabilized around 2.3 percent since October 2024. Putin did not speak about Russia's labor shortages that are causing this low employment rate, however, in contrast to his 2024 SPIEF speech in which he acknowledged that Russia was suffering from labor shortages and highlighted the need for skilled migrant labor to increase Russia's economic growth.[19] Putin may be attempting to gloss over his ongoing efforts to leverage migrants to mitigate ongoing labor shortages amid increasing anti-migrant sentiments in Russia.[20]
The Kremlin has repeatedly attempted to posture the Russian economy as strong and stable, claiming in recent months that inflation was between nine and 10 percent when the actual figure was likely closer to 20 percent.[21] Putin's June 20 claim that Russian inflation is 9.6 percent is likely also false. ISW has observed reports that domestic consumers in Russia continue to face rising prices for staple food items, such as potatoes and butter.[22] Putin also failed to acknowledge the growing detrimental effects of high interest rates of 20 percent on the Russian industrial sector. Russian steel company Severstal head, Alexander Shevelev, warned on June 19 that metallurgical production facilities are at risk of shutting down due to low consumer demand and high interest rates.[23] Russian Central Bank Chairperson Elvira Nabiullina notably stated at SPIEF on June 19 that Russia's economy grew at a high rate for two years because Russia was using “free resources,” including Russia's workforce, production capacity, import substitution, the liquid assets of the National Welfare Fund, and the banking system's capital reserve, but that Russia has exhausted many of these resources and needs to think of a new growth model.[24] ISW previously assessed in early June 2025 that the Russian government was likely pressuring Nabiullina to lower Russia's key interest rate to reduce the impact of high interest rates on the Russian budget and civilian industries.[25]
Putin's efforts to frame the Russian economy as stable and growing are part of his efforts to balance social support programs with Russia's military needs and maintain his support among the Russian population despite the growing economic costs of his war in Ukraine.[26] ISW continues to assess that Kremlin efforts to pressure the Central Bank into prematurely lowering the key interest rate to maintain the facade of economic stability may backfire and contribute to elevated levels of inflation.[27]
https://www.understandingwar.org/backgrounder/russian-offensive-campaign-assessment-june-20-2025