The Kremlin is using nuclear threats to influence US President Donald Trump to stop his efforts to secure peace in Ukraine. Russian Security Council Deputy Chairperson Dmitry Medvedev used his English-language X (formerly Twitter) account on September 23 to reiterate Russian President Vladimir Putin's recent announcement that Russia is prepared to continue to adhere to the nuclear arms limitations in the New Strategic Arms Reduction Treaty (New START) for one year after it expires on February 5, 2026.[1] Medvedev stated that the Trump administration must now decide whether it will follow suit. Medvedev claimed that US adherence to the letter of the treaty “is not enough,” however, and that the United States “must give up on weakening Russia with sanctions and tariffs” or else “the risk of direct conflict remains high.” Medvedev’s veiled nuclear threats directly tie US agreement to stop all its economic measures targeting Russia—the main tool that the Trump administration is using to try to bring Putin to the negotiating table to end the war in Ukraine—to Russia's continued adherence to New START or readiness to agree to any future arms control treaties. Medvedev’s threats are part of wider Kremlin efforts to delay peace negotiations, use threats to secure Russia's desired demands in Ukraine, secure concessions that benefit Russia, and deter the United States from supporting Ukraine.
Russia launched a multipronged informational campaign intended to mask Russia's economic weakness that US President Donald Trump recently correctly identified.> Kremlin officials responded on September 24 directly and indirectly to Trump's September 23 statement outlining Russia's military shortcomings and economic turmoil.[2] Kremlin Spokesperson Dmitry Peskov responded to Trump's statement about how Russia's poor economic situation makes Russia look like a “paper tiger,” claiming that Russia is “more closely associated with a bear” and that “there are no paper bears.”[3] Peskov also explicitly rejected Trump's assertion that Ukraine could retake territory with assistance from the North Atlantic Treaty Organization (NATO) and the European Union (EU).[4] Peskov claimed that Ukraine's military position is significantly worse than in Spring 2022 and that US efforts to “encourage” Ukraine to continue military operations are “misguided.”[5] The Kremlin aims to convince Trump and the West that continuing to support Ukraine and oppose Russia is not viable and that the United States should instead allow Russia to continue its war unimpeded.
The Kremlin launched three distinct narratives in response to Trump's September 23 statement: statements about the Kremlin's continued commitment to its original war aims; claims that a Russian victory in Ukraine is inevitable; and claims that the United States should focus on bilateral US-Russian economic relations. Peskov claimed that Russian President Vladimir Putin is open to the settlement process to end the war in Ukraine and that Trump “cannot help but see Putin's openness to this process.”[6] Peskov claimed that the “war is not aimless” but is meant to ensure Russia's security and Russian interests and to eliminate the war's “root causes.”[7] The Kremlin has repeatedly defined the alleged root causes as NATO's eastward expansion and Ukraine's alleged discrimination against Russian speakers. The Kremlin often uses claims about the root causes to call for Ukraine and the West to give in to Russia's original war aims.[8] Peskov also provided excuses for Putin's disinterest in participating in a bilateral meeting with Ukrainian President Volodymyr Zelensky, claiming that a meeting without significant preparation would be a “public relations stunt doomed to fail.”[9] Putin remains uninterested in good faith negotiations that require compromises and is instead making the same demands of Ukraine and the West as he did in late 2021 and February 2022.[10]
Peskov claimed that there is an influx of volunteers joining the Russian military, allowing the Russian military command to fully staff all its units, and that the Russian economy is fully meeting the Russian military's needs.[11] Peskov claimed that Ukraine must “not forget” that its position only worsens with every day that Ukraine refuses to negotiate and that the situation on the frontline is evidence of Ukraine's deteriorating situation.[12] Russian Security Council Deputy Chairperson Dmitry Medvedev claimed that Trump's September 23 statements show that Trump is living in an “alternate reality.”[13] Russian Direct Investment Fund (RDIF) CEO and key Kremlin negotiator Kirill Dmitriev claimed that Russia's economy is outperforming those of the EU, the United Kingdom, and the United States.[14] The Kremlin is attempting to frame Russian battlefield victory as inevitable to push Ukraine and the West to capitulate and agree to all of the Kremlin's demands out of fear that Russia has the capacity to sustain and even worsen its aggression.
Peskov claimed that there are a “huge number” of mutually beneficial areas for cooperation between American and Russian businesses and that the Trump administration is “generally business oriented.”[15] Peskov claimed that the Trump administration “cannot help but understand” the benefits of US-Russian trade and economic cooperation and that Russia remains open to the resumption of trade. Peskov stated that US-Russia relations are proceeding much more slowly than Russia would like.[16] The Kremlin has for months been trying to use economic carrots to influence the Trump administration into normalizing US-Russian bilateral relations without concluding the war in Ukraine.[17] ISW continues to assess that the Kremlin is dangling the prospect of business incentives unrelated to the war to extract concessions from the United States about the war.[18]
Ukrainian President Volodymyr Zelensky reiterated his commitment to engaging in peace negotiations and holding elections in accordance with the Ukrainian Constitution and Ukrainian law. Zelensky stated on September 24 in an interview with Fox News that Ukraine is ready to end the war as soon as possible.[19] Zelensky also reiterated that he is ready to hold elections once a ceasefire is in place and Ukraine has received security guarantees. The Ukrainian Constitution and Ukrainian law explicitly prohibit the government from holding elections during times of martial law, which Ukrainian authorities cannot lift during times of external aggression, such as Russia's full-scale invasion.[20]
Former Ukrainian Command-in-Chief and current Ukrainian Ambassador to the United Kingdom General Valerii Zaluzhnyi assessed on September 24 that Russian forces are adapting technological innovations and ground tactics in an attempt to restore maneuver to the battlefield. Zaluzhnyi stated that Russian and Ukrainian forces are engaged in positional warfare, even as Russian forces continue to make what Zaluzhnyi characterized as “grinding” advances.[21] Zaluzhnyi assessed that Russian drone strikes and innovations have forced Ukrainian forces to disperse their defenses on the frontline, with scattered small infantry groups that must act autonomously. Zaluzhnyi stated that this dispersion is blurring the frontline and that the “kill zone” (an area immediately near the frontline where a mass of tactical strike and reconnaissance drones pose an elevated risk to any equipment or personnel that enters the area) extends 20 kilometers from the frontline. Zaluzhnyi stated that the dominance of drones is dispersing the battlefield by preventing both sides from concentrating in their near rear and rear areas. Zaluzhnyi noted that Russian forces have developed infiltration tactics to take advantage of the resulting gaps in Ukrainian defenses, most notably near Dobropillya and Kupyansk. Zaluzhnyi also assessed that drones with artificial intelligence (AI) capabilities present a new threat on the battlefield.
ISW recently assessed that Russian forces are integrating drone tactics and adaptations to achieve some effects of battlefield air interdiction (BAI).[22] ISW assesses that Russian forces are actively targeting Ukrainian training grounds in the near rear with precise missile strikes enabled by improved reconnaissance and are developing drones that are more resistant to Ukrainian electronic warfare (EW) interference and capable of operating at longer distances, higher speeds, and in challenging environments.[23] The Ukrainian Ground Forces reported on September 24 that Russian forces struck a training ground with Iskander-M/KN-23 ballistic missiles, in line with Zaluzhnyi's and ISW’s assessment that Russia's technological innovations are preventing Ukrainian forces from being able to safely concentrate in the rear.[24] Russia is continuing to adapt its drones to be resistant to Ukrainian EW. Ukrainian electronic and radio warfare expert Serhiy “Flash” Beskrestnov reported on September 24 that some Russian drones do not have any communication channels and are able to navigate and strike targets autonomously.[25] Beskrestnov noted that Ukrainian forces cannot suppress such drones because these drones do not rely on radio frequencies.
Russian jamming originating from Kaliningrad Oblast likely disrupted the GPS on Spanish Defense Minister Margarita Robles’ plane flying to Lithuania on September 24. Spanish news outlet El Mundo reported on September 24 that a plane carrying Robles experienced GPS disruptions while flying in the airspace near Kaliningrad Oblast.[26i] El Mundo reported that the plane was flying to Siauliai Air Base in Lithuania and that the pilot was still able to receive military satellite signals during the flight despite the GPS disruptions. An anonymous defense source told Reuters that they did not think that the disruption was targeted and that such disruptions are common on the route.[27] El Mundo reported that a Spanish commander on board similarly downplayed the disruption as a common occurrence. Robles stated that it is essential to defend the right to freely move throughout European territory without experiencing such disruptions.[28] Russia has likely previously jammed the satellite signal of other planes carrying high-ranking European officials, including a jet transporting then-UK Defense Secretary Grant Shapps in March 2024 and a plane carrying European Commission President Ursula von der Leyen on September 1.[29]
Russia is likely using Kaliningrad Oblast for jamming operations due to its proximity to European states. A pro-Ukrainian investigative outlet previously found that Russia was constructing a Circularly Disposed Antenna Array (CDAA), a military grade antenna array designed for radio intelligence or communication, just south of Chernyakhovsk, Kaliningrad Oblast.[30] The CDAA may allow Russia to monitor NATO communications in Eastern Europe and the Baltic Sea, communicate with submarines operating in the Baltic Sea or northern Atlantic Ocean, and support passive intelligence gathering.
Ukrainian forces recently conducted a series of aerial and naval drone strikes against Russia and occupied Crimea, including against Russian oil infrastructure and drone production facilities. The Ukrainian General Staff reported that Ukrainian forces struck the Gazprom Neftekhim-Salavat petrochemical plant in Salavat, Republic of Bashkortostan on the night of September 23 to 24, hitting the primary oil processing unit and starting a fire.[31] The enterprise reportedly processes up to 10 million tons of oil per year and is a key producer of liquid rocket fuel in Russia. The Ukrainian General Staff also reported that Ukrainian forces struck two oil pumping stations in Volgograd Oblast: Kuzmychi-1 oil pumping station, which transports crude oil to southern Russia, and Zenzevatka oil pumping station, which transports oil through the Kuibyshev-Tikhoretsk main oil pipeline that Russia uses for oil exports through the port of Novorossiysk, Krasnodar Krai.
Geolocated footage published on September 24 shows a likely Ukrainian naval drone exploding at the port of Tuapse, Krasnodar Krai (southeast of Novorossiysk).[32] Additional geolocated footage published on September 24 shows a smoke plume in central Novorossiysk.[33] Krasnodar Krai Governor Veniamin Kondratyev claimed that Ukrainian drones hit central Novorossiysk on the afternoon of September 24.[34] The Caspian Pipeline Consortium (CPC) confirmed on September 24 that a Ukrainian drone strike damaged a CPC office in central Novorossiysk, temporarily suspending operations.[35] Bloomberg reported on September 24, citing an unnamed source, that the Sheskharis oil port facility in Novorossiysk also stopped operations.[36] Bloomberg noted that Sheskharis and CPC together export over two million barrels a day of Russian and Kazakh oil to global markets. The Kazakhstan Energy Ministry reported that oil shipments and transportation through Novorossiysk are proceeding as usual.[37]
Ukraine's Unmanned Systems Forces (USF) reported that USF elements conducted a drone strike against drone production facilities near the railway station in Valuyki, Belgorod Oblast on the evening of September 23, causing a large fire.[38] NASA's Fire Information for Resource Management System (FIRMS) data shows heat anomalies at Valuyki.[39] A Russian source also claimed that there was an explosion near Belbek and Kacha air bases in occupied Crimea on the morning of September 24, likely due to a Ukrainian drone strike.[40] Sevastopol occupation governor Mikhail Razvozhaev claimed on September 24 that Russian air defenses and elements of the Black Sea Fleet shot down 16 Ukrainian drones targeting occupied Sevastopol.[41]
Kaliningrad is a justified target.
NATO will do nothing, but Ukrainian special services might just have an answer🤔
The Russian Ministry of Defense (MoD) continues to artificially inflate its claims of advance in Ukraine to support the Kremlin's false narrative that a Russian victory in Ukraine is inevitable. The Russian MoD claimed that Russian forces seized at least 4,714 square kilometers across the theater between January 1 and September 25, 2025: 205 square kilometers in Luhansk Oblast; 3,308 square kilometers in Donetsk Oblast; 261 square kilometers in Zaporizhia Oblast; 175 square kilometers in Dnipropetrovsk Oblast; 542 square kilometers in Kharkiv Oblast; and 223 square kilometers in Sumy Oblast.[1] The Russian MoD claimed that Russian forces seized 205 settlements in Ukraine during this time period. ISW has observed evidence to assess that Russian forces have seized only 3,434 square kilometers since January 1: 151 square kilometers in Luhansk Oblast; 2,481 square kilometers in Donetsk Oblast; 248 square kilometers in Zaporizhia Oblast; 96 square kilometers in Dnipropetrovsk Oblast; 255 square kilometers in Kharkiv Oblast; and 210 square kilometers in Sumy Oblast. ISW assesses that the Russian MoD is inflating its claimed advances by 36 percent in Luhansk Oblast; 33 percent in Donetsk Oblast; five percent in Zaporizhia Oblast; 83 percent in Dnipropetrovsk Oblast; 112 percent in Kharkiv Oblast; and six percent in Sumy Oblast.
The Russian MoD often inflates its territorial claims in order to shape Western thinking about Russia's military capabilities and prospects for victory. Russian Chief of the General Staff Army General Valery Gerasimov claimed on August 30 that Russian forces had seized 3,500 square kilometers of territory and 149 settlements since March 2025, whereas ISW assessed at the time that Russian forces had gained only roughly 2,346 square kilometers since March 1.[2] The Russian MoD’s September 25 claims are a continuation of these wider efforts to use large amounts of false quantitative data to create the impression that Russian forces are advancing at a fast rate on the battlefield, even though Russian forces continue to advance at a slow foot pace. ISW also assesses that the Russian MoD has been leveraging footage showing Russian soldiers holding flags within specific settlements to claim that Russian forces had seized entire settlements.[3] The Russian footage only shows small group infiltration missions into areas where Russian forces are unable to secure enduring positions, however.[4] The Kremlin is attempting to convince the West that Russia will inevitably achieve its original war goals on the battlefield in order to force Ukraine and its partners into conceding to Russian demands.
Russian forces are reportedly rearranging forces to prepare for offensive operations across several sectors of the frontline but lack the forces and means required to sustain these operations simultaneously. Ukrainian military observer Kostyantyn Mashovets reported on September 24 that the Russian military command is rearranging forces in order to conduct several operational-level efforts across the frontline, including offensive operations in the Kupyansk, Lyman, Kostyantynivka, Pokrovsk, and Zaporizhia directions, as part of Russia's wider strategic-level plan for 2025.[5] Many of these Russian efforts are not mutually supportive in that forces assigned to one sector of the front are not conducting offensive operations in a way that supports the offensive operations of another sector. Mashovets noted that the Russian military command began in August 2025 to redeploy some forces from deprioritized sectors of the front, including Sumy and Kherson oblasts, to higher priority sectors in eastern Ukraine — some of which Mashovets characterized as “odd.”[6] Mashovets stated that the Russian military command redeployed elements of the 76th Airborne (VDV) Division from Sumy Oblast to the area of responsibility (AoR) of the 5th Combined Arms Army (CAA, Eastern Military District [EMD]) in the south Donetsk direction (likely referring to the Novopavlivka and Velykomykhailivka directions) and to the AoR of the 35th CAA (EMD) in the Hulyaipole direction.[7] Russian VDV are among Russia's relatively more combat capable forces, and Russia tends to redeploy these forces to their most prioritized areas of the front, including the Kostyantynivka and Dobropillya areas.[8] Mashovets reported that unspecified sources expected Russia to redeploy elements of the 76th VDV Division to western Zaporizhia Oblast to participate in offensive operations south of Zaporizhzhia City.[9] Mashovets reported that Russia is establishing operational reserves in the 58th CAA (Southern Military District [SMD]) operating in the deprioritized Kherson direction from the 25th CAA (Central Miliary District [CMD]) that is currently operating in the Lyman direction, rather than from units and formations of the 58th CAA itself.[10] Mashovets reported that the Russian command is similarly establishing operational reserves in the 3rd CAA (formerly 2nd Luhansk People's Republic Army Corps, SMD), which is currently operating in the Lyman direction, from elements of the 70th Motorized Rifle Division (18th CAA, SMD) in the Kherson direction.
Russia's decision to reorganize forces from the Lyman direction to the operational reserve in the Kherson direction and from the Kherson direction to the operational reserve in the Lyman direction is unusual given Russia's current focus on operations in Donetsk Oblast, particularly between Kostyantynivka and Pokrovsk. Russian forces recently redeployed VDV and the relatively elite naval infantry elements to this area, and some of these forces have since reportedly entered combat. Elements of the Russian 177th Naval Infantry Regiment (Caspian Flotilla) and of the 40th and 155th naval infantry brigades (both Pacific Fleet) recently entered combat near Poltavka after redeploying from northern Sumy Oblast, and elements of the 336th Naval Infantry Brigade (Baltic Fleet) are reportedly fighting near Nove Shakhove after redeploying from the Novopavlivka direction.[11] The Russian military command is reportedly holding elements of the 61st Naval Infantry Brigade (Northern Fleet) in reserve in the near rear of the Dobropillya area after redeploying from the Kherson direction, though ISW continues to observe reports that elements of the 61st Naval Infantry Brigade are operating in the Kherson direction, indicating that elements of the brigade are likely split across the front.[12]
The Russian offensive in Kupyansk is reportedly vulnerable due to the lack of sufficient forces to sustain simultaneous offensive operations against Kupyansk and several other areas along the frontline. Mashovets stated that elements of the Russian 6th CAA (Leningrad Military District [LMD]) fighting within and on the northwestern outskirts of Kupyansk are “fragile” and would be vulnerable to Ukrainian counterattacks should Russian forces stop attacks within Kupyansk and from the Russian foothold north of Kupyansk on the west (right) bank of the Oskil River.[13] Mashovets noted that Russia must simultaneously allocate forces and means to offensive operations within and north of Kupyansk to protect the flanks and logistics of the Russian forces assaulting Kupyansk. Mashovets assessed that Russian forces will need to allocate one to two additional divisions’ worth of forces to offensive operations to actually seize Kupyansk. Mashovets noted that the Russian military command is aware that it needs to reinforce, break through Ukrainian defensive positions, and consolidate in the Kupyansk direction, and that these efforts are in tension with the Russian strategic objective of maintaining several simultaneous offensive operations across the frontline — an objective that Russian forces have struggled with since Summer 2022.[14] Mashovets assessed that Russian forces would have to redistribute resources in order to stabilize the situation in the Kupyansk direction.[15] Russian forces will likely continue to struggle to maintain simultaneous offensive operations across discrete areas of the frontline, particularly in areas that are not receiving redeployments of relatively combat-effective units from deprioritized sectors of the frontline. Russian forces may also struggle to advance in their prioritized sectors — chiefly in the Kostyantynivka-Druzhkivka and Dobropillya tactical areas and the Pokrovsk direction in Donetsk Oblast — if the Russian military command sends reinforcements to other areas that could be more effective in Donetsk Oblast.
Russian officials privately admitted that Russia is responsible for the September 19 incursion of three MiG-31 interceptor jets into Estonian airspace. Unnamed officials told Bloomberg in an article published on September 24 that Russian, British, French, and German envoys met in Moscow to address concerns about the incursion of three Russian MiG-31 fighter jets into Estonian airspace on September 19.[16] The officials reportedly concluded that Russian commanders deliberately ordered the jets into Estonian airspace. A Russian diplomat reportedly told the European diplomats that the incursions — likely referring to the Estonia incursion as well as several other recent Russian violations of NATO state airspace — were a response to Ukrainian strikes on occupied Crimea. Bloomberg noted that the Russian official claimed that NATO support enabled the Ukrainian strikes and stated that Russia considers itself to be already engaged in a confrontation, including against European states. Russia has publicly denied its involvement in the incursion into Estonia, claiming that the three Russian jets were completing a “scheduled flight” from an airfield in Karelia.[17] ISW continues to assess that Russia is deliberately gauging NATO's capabilities and reactions to various air incursions.[18]
Polish Border Guards reported on September 19 that two Russian fighter jets performed a low altitude pass over the Polish Lotos Petrobaltic oil and gas drilling platform in Poland's exclusive economic zone in the Baltic Sea, violating the platform's safety zone.[19] Danish Defense Minister Troels Lund Poulsen stated on September 25 that unidentified drones flew over at least four airports in Denmark on the night of September 23 to 24 and that the near-simultaneous deployment of drones in multiple locations indicates that a “professional actor” was involved in a “systematic operation” and “hybrid attack.”[20] Latvian Foreign Minister Baiba Braže reported to Reuters on September 25 that Denmark told NATO allies that unspecified “state actors” conducted the drone incursion over Denmark overnight on September 24 to 25, though unspecified other Danish officials told Reuters that the actor behind the incidents is unclear.[21] Danish and European officials have not directly accused Russia of violating Danish airspace as of this writing — as Polish and Romanian officials did after Russian drones violated Polish airspace on the night of September 9 to 10 and Romanian airspace on September 13.[22] North American Aerospace Defense Command (NORAD) reported on September 25 that NORAD detected and tracked two Russian Tu-95 bombers and two Su-35 fighter jets operating in the Alaskan Air Defense Identification Zone (ADIZ) on September 24.[23] NORAD scrambled an E-3 airborne early warning and control (AWACS) aircraft, four F-16 fighter jets, and four KC-135 tankers to identify and intercept the Russian aircraft. NORAD clarified that Russian activity in the Alaskan ADIZ is normal and nonthreatening and that the Russian aircraft did not enter US or Canadian airspace.
Russian officials continued attempts to convince the Trump administration to allow Russia to continue its war against Ukraine unimpeded in the wake of US President Donald Trump's September 23 comments emphasizing that Ukraine has the ability to retake all of its territory. US Secretary of State Marco Rubio met with Russian Foreign Minister Sergei Lavrov on September 24, during which Rubio reiterated Trump's call for the Kremlin to take meaningful steps toward a durable resolution of the war in Ukraine.[24] Lavrov stated that he and Rubio “exchanged views” on resolving the war and claimed that Russia is ready to coordinate with the United States to address the “root causes” of the war.[25] The Kremlin has repeatedly defined the “root causes” as NATO's eastward expansion and Ukraine's alleged discrimination against Russian speakers.[26] Russian Security Council Deputy Chairperson Dmitry Medvedev used his English-language X (formerly Twitter) account on September 25 to claim that Russia can use weapons that “a bomb shelter will not protect against” and threatened Americans to “keep this in mind.”[27] Kremlin Spokesperson Dmitry Peskov claimed on September 25 that Russia assumes that Trump “maintains the political will” to resolve the war and that Russia remains open to entering peace talks.[28] Russian Direct Investment Fund (RDIF) CEO and key Kremlin negotiator Kirill Dmitriev amplified an opinion piece in the Telegraph claiming that Trump is washing his hands of the war in Ukraine.[29] Russian officials have launched several different information operations in recent days trying to dissuade Trump and the West from continuing to support Ukraine, including using narratives decrying the Kremlin's continued commitment to its original war aims, claims that a Russian victory in Ukraine is inevitable, and claims that the United States should focus on bilateral US-Russian economic relations.[30]
The Kremlin reportedly plans to allocate less to national defense spending in 2026 than in 2025 but acknowledged that it is increasing some taxes to fund “defense and security.” Reuters reported on September 24 that it viewed documents from the Russian Finance Ministry stating that Russia plans to allocate 12.6 trillion rubles (about $150 billion) to “National Defense” spending in 2026 — down from 13.5 trillion (about $160 billion) in 2025.[31] The Russian Finance Ministry stated on September 24 that the key priorities in the 2026-2028 draft budget include the fulfillment of social obligations to citizens, support for Russia's defense and security needs, and social support for families of Russian soldiers fighting in Ukraine.[32] The Finance Ministry stated that the budget allocates funding to ensure that Russia can equip the military, pay military personnel and their families, and modernize the defense industrial base (DIB), including through the allocation of 87.9 billion rubles (about $1 billion) toward the Unmanned Aircraft Systems project over three years. The Finance Ministry also announced an increase in value-added tax (VAT) from 20 percent to 22 percent starting January 2026 and a decrease in the annual revenue threshold for businesses that must pay VAT from 60 million rubles (about $714 thousand) to 10 million rubles (about $119 thousand). The Finance Ministry noted that the VAT changes are primarily meant to fund defense and security. Reuters reported that unpublished documents from the Russian Finance Ministry estimated that the VAT increase would generate about 1.2 trillion rubles (about $14.2 billion) in additional revenue in 2026. Russian Finance Minister Anton Siluanov claimed on September 18 that Russian authorities expect the share of Russia's revenues from oil and gas sales funding the Russian federal budget to be about 20 to 22 percent in 2026, which Siluanov noted is a decrease from about 50 percent previously.[33] The Kremlin is likely seeking other revenue streams as oil and gas revenues, on which Russia has relied to fund its war in Ukraine, are decreasing in the face of impending Western sanctions and Ukrainian strikes against Russian oil infrastructure.
The Kremlin is likely looking for different avenues to raise funding for defense and national security spending without aggravating existing socio-economic tensions. Recent Kremlin state media coverage and social media campaigns following the announcement of the VAT increase suggest that the Kremlin is aware of the possibility of social discontent due to the resulting increase in prices of everyday goods. Russian opposition outlet Meduza reported on September 24 that Russia's main state television channels reported on the VAT increase “discreetly,” only mentioning the change at the end of broadcasts after reports about the war in Ukraine, US President Donald Trump's speech at the United Nations, and the upcoming parliamentary elections in Moldova.[34] Meduza noted that Russian state outlets Pervyi Kanal, Rossiya 1, and NTV each mentioned the VAT change in only one sentence. Russian opposition outlet Verstka reported on September 25 that pro-Russian government bots have written nearly one thousand comments on Kremlin-controlled social media outlet VKontakte (VK) in support of the VAT rise.[35] The bots reportedly focused on how the VAT revenue will go “to defense” and help those involved in the war in Ukraine, how tax raises are better than cuts to social programs, and how Russian citizens “will not really notice” the two percent difference.
Russian Central Bank Chairperson Elvira Nabiullina attempted to downplay the effect that the VAT increase could have on inflation but acknowledged that VAT hikes have worsened inflation in the past. Nabiullina claimed on September 25 that the VAT increase is a “very positive factor” and that a balanced budget is better than an increasing deficit.[36] Nabiullina claimed that the Central Bank would have had to significantly raise its rate forecasts for 2026 had the government increased the deficit to finance necessary expenditures. Nabiullina stated that the Central Bank sees “certainty” in the federal budget and will take this into account when making a decision about possibly cutting the key interest rate further in October 2025. Nabiullina claimed that the 2026 draft budget is disinflationary but that the experience of 2019 — when a two percent rise in VAT increased inflation by 0.6 to 0.7 percent — suggests that prices will likely rise in the short-term. ISW continues to assess that the Russian Central Bank's efforts to maintain the facade of domestic economic stability by pursuing economic policies will likely exacerbate Russia's economic instability.[37]
Russia continues to suffer from gasoline shortages in Russia and occupied Ukraine due to repeated Ukrainian strikes on Russian oil refineries.[38] Kremlin officials are attempting to downplay the gasoline shortages to domestic audiences as a result of reduced production at refineries, however.[39] Several milbloggers from Russia's ultranationalist community — one of Russian President Vladimir Putin's most important constituencies — complained about the gas shortages and rising taxes on Russian citizens.[40] Continued or worsening gasoline shortages, possibly coupled with rising inflation due to the VAT increase, may fuel additional social discontent in the near future.