Talks On Peace Deal for War Against Ukraine Can Still Rebound

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(Source: Getty Images / Andrew Harnik)

Executive Summary:

  • The failed attempt to organize a summit between Russian President Vladimir Putin and U.S. President Donald Trump in Budapest deepened tensions over the war against Ukraine, prompting renewed Russian nuclear posturing and strategic unease.
  • Putin’s reliance on exaggerated battlefield “successes” and nuclear brinkmanship reveals his effort to project strength amid domestic stagnation and waning military momentum.
  • Mounting economic decline, elite discontent, and Western sanctions are pressuring Putin toward potential ceasefire flexibility, but his fear of appearing weak may limit genuine compromise despite the possible appeal of renewed negotiations.

The fallout from the failed Russian plan to organize a meeting between Russian President Vladimir Putin and U.S. President Donald Trump in Budapest was so significant that any prospect of bringing the war against Ukraine to an end any time soon appeared to disappear. Trump’s statement that a follow-up summit would be a “waste of time” seemingly negated the “Anchorage Impulse,” to which Putin had referred up to mid-October, implying that Trump acknowledged at the Alaska summit the Russian interpretation of “root causes” of the war (Nezavisimaya gazeta, October 10; TASS, October 22). Putin subsequently resorted to nuclear posturing, a move he had uncharacteristically abstained from for most of the first year of Trump’s presidency (Meduza, October 30; see EDM, November 3). Some new currents in the political atmosphere have, nevertheless, rehabilitated resilient hopes for a new round of results-oriented talks.

Nuclear brinksmanship has not delivered the results that Putin expected. Trump’s vague order to resume nuclear testing immediately, on par with other great powers, has left Russian experts puzzled and worried (RIAC, October 31; TopWar.ru, November 6). Putin convened an emergency meeting of his Security Council on November 5, which, contrary to usual protocol, was open to the media. In the orchestrated debate on the proposal for preparing the Novaya Zemlya test site for underground nuclear explosions, the predictably hawkish voices advocated instead for a wait-and-see approach (Kommersant, November 5). The Russian autocrat can still claim to have gained a new position of strength and deterred the U.S. attempt to put pressure on Moscow (Novaya Gazeta Europe, November 5). Russian-style nuclear deterrence is not exactly a “mind game” with calculated moves, but rather a vanity fair for demonstrating hugely expensive weapon systems of dubious military value (Meduza, November 5).

Chief of the General Staff Valery Gerasimov reported perceived newly-gained advantage on the Donbas battlefields to Putin in the same meeting where he described the successful test of the Burevestnik nuclear-propelled cruise missile (Kommersant, October 26). His presentation of two large-scale encirclements of 31 Ukrainian battalions was a figment of strategic imagination, and even the maps of combat operations published in the Russian mainstream media show nothing resembling that report (Kommersant, November 7). The situation around the twin cities of Pokrovsk and Myrnohrad, however, is very difficult for the Ukrainian forces, and the relentless Russian attacks may compel them to retreat to the next belt of trenches (Re: Russia, November 7). A military rationale for such a withdrawal has been apparent for at least a few weeks, but the stubborn defense that has inflicted tens of thousands of casualties on the Russian storm troops has also acquired great symbolic importance (Novaya Gazeta Europe, November 6). The Ukrainian command can prioritize strategic calculations, but Putin can present the capture of a few dozen square miles of smoldering ruins as a great victory (Radio Svoboda, November 7).

The combination of imagined nuclear advantages and inflated gains in protracted battles may make it possible for Putin to show flexibility in renewed bargaining on a peace deal (RBC, November 7). Russian Foreign Minister Sergei Lavrov has seemingly been made to disappear, perhaps as a signal of a softening of Russia’s rigid stance, for which he was not actually responsible (Vzglyad, November 7). A significant incentive for resuming talks with the United States is the positive outcome of the meeting between Trump and President Xi Jinping of the People’s Republic of China, where trade matters were at the top of the agenda. Ukraine, however, was also discussed (RIAC, November 5). The impression that the matter of crucial importance for Russia is discussed behind the back of its ruler has been aggravated by Trump’s invitation to the White House of five leaders of Central Asian states—Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan—and their acknowledgement of his key role in making a peace deal (Carnegie Politika, November 7).

All these parties are aware of the steady degradation of the Russian economy. Putin remains in denial, despite the Russian Central Bank’s revised forecast predicting zero growth (The Moscow Times, November 7). The official macroeconomic data is carefully manipulated, but the sustained decline in the volume of goods transported by railroads proves the real depth of the recession (The Insider, November 5). New U.S. sanctions on Russian oil exports target the most vulnerable economic sector, as budget revenues from the oil and gas industry shrank by 26.7 percent in October compared to the same month in 2024 (Neftegaz.ru, November 6).

The Russian war machine can only be sustained by increased taxation of other businesses and selective confiscation of private savings (Radio Svoboda, November 5). Business elites struggle to preserve their fortunes, but their private survival strategies clash with the state’s demand for more income and are squeezed by the sanctions regime (Carnegie Politika, November 6). Oil giant Lukoil sought to circumvent the latest U.S. ban by selling its international assets to the Swiss trader Gunvor, described by the U.S. Treasury Department as “the Kremlin’s puppet,” resulting in a no-deal outcome (Forbes.ru, November 7). Both government officials and business leaders recognize that the factors driving the economy down are intensifying, but public opinion continues to expect improvements in the coming months (Levada Center, October 30).

Putin cannot completely depart to the parallel reality of military victories, economic stability, and mass adulation, and so proceeds with elite reshuffles and repression of discontent. His risk calculus related to accepting a ceasefire deal was shaped by the fear of showing weakness, which would be detrimental to the long-cultivated image of a strong leader. The recent demonstrations of strength may alleviate this fear and grant him some time-limited space for accepting compromises and freezing the hostilities. This flexibility could be instantly popular with most elites and the majority of Russians, but to prevent questions about the costs and purposes of the war from eroding this popularity, he needs to deliver the economic benefits of his concessions. The lifting of sanctions is likely to be Moscow’s key demand in a potential new round of talks, and the partners in the Western coalition will have to weigh the difficult choice of rewarding Putin’s aggression.