Ukraine Latest: Zelenskiy Speaks With JPMorgan on Reconstruction

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(Bloomberg) — Russia launched its biggest barrage of missile attacks against Ukraine so far this year, a day after President Volodymyr Zelenskiy completed a visit to European capitals, where he sought more weapons to fend off Vladimir Putin’s invasion.  

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Romania pushed back against a claim by Ukraine’s top commander that two Russian cruise missiles had crossed into the NATO member’s air space, while Moldova summoned Russia’s ambassador after the projectiles passed over its territory.

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Moscow’s plan to slash oil output by 500,000 barrels a day — which pushed oil prices to their largest weekly gain in four months – shows the extent to which Putin is willing to use energy as a weapon, a White House official said. President Joe Biden will travel to Poland to mark one year of Russia’s invasion of Ukraine. 

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

Key Developments

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On The Ground

Russian forces continued an offensive in the direction of Kupyansk, Lyman, Bakhmut, Avdiivka and Novopavlivka, General Staff said on Facebook. On Friday, Ukrainian army repelled Russian attacks near three settlements in the Luhansk region and four settlements in Donetsk region. The Ukrainian Air Force delivered 12 strikes at Russian positions and 4 strikes at the positions of Russian anti-aircraft missile systems. The Odesa region was twice attacked by Russian missiles overnight, the city council said. Bombs were also dropped on Snake Island from two Su-24M jets. Two Oniks anti-ship cruise missiles were fired from Crimea and hit coastline in Odesa region, without casualties.

(All times CET)

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Zelenskiy Looks to Reconstruction at JPMorgan Summit (10:45 a.m.)

Ukraine needs foreign investment to diversify and decentralize its energy system and make it less vulnerable to Russian attacks, President Volodymyr Zelenskiy told an investment summit organized by JPMorgan. 

Zelenskiy met in Kyiv with three senior officials from the investment bank and addressed the conference via video link, according to a posting on the presidential website. 

Zelenskiy urged private investors to consider Ukraine’s IT and agriculture technology sectors. He said the war has strengthened intolerance of corruption in Ukrainian society and his government is stepping up. 

Russia Likely Turning to Convict Labor in Defense Plants, UK Says (8 a.m.)

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Russia’s regular military has likely deployed the vast majority of reservists called up under last year’s “partial mobilization,” the UK defense ministry said. 

That leaves Russia “the difficult choice of either continuing to deplete its forces, scale back objectives, or conduct a further form of mobilization,” the UK said on Twitter. 

Further, the nation’s defense manufacturing “is highly likely resorting to using convict labor to meet war-time production demands,” the UK said.     

Serbian President Warns of ‘Major Escalation’ (7 a.m.)

Aleksandar Vucic predicted a “major escalation” of Russia’s invasion over the next five to six months in a TV interview Friday night. 

“This so far is almost nothing in comparison to what’s to come,” Serbia’s president told Prva TV in Belgrade. “In five to six months they will try to de-escalate, but in the next five to six months there will be the most fierce conflict.”

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At this point “it’s not clear who’s winning” in Ukraine, he said.  

Putin Weaponizing Energy With Oil Output Cut: White House 

Russia’s plan to slash its oil output by 500,000 barrels a day next month shows the extent to which President Vladimir Putin is willing to use resources like energy as a weapon, said John Kirby, spokesman for the White House’s National Security Council. 

Putin’s move isn’t surprising after a decision by G-7 and the European Union to implement price caps on Russian oil and oil products, Kirby said. The US will continue to work with allies and partners, including those in OPEC, he added, saying he had no specific conversations to speak of at this time.  

Oil posted its largest weekly gain in four months after Russia followed through on a threat to cut production in response to Western energy sanctions. 

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Russia Launches Further Drone Attacks (8:30 pm)

Russia launched another wave of attacks by Iranian-made drones, targeting southern and central regions including Odesa and Mykolaiv, Ukrainian officials said.

Mykolaiv regional governor Vitaliy Kim said Ukrainian troops shot down three Shahed drones and the governor of Odesa said that air defenses shot down four of the aircraft that had attempted to attack energy infrastructure. Warning sirens were also heard in Kyiv. 

Wagner Founder Sees 2-Year Effort to Control Donbas (8:15 p.m.)

Yevgeny Prigozhin, founder of the Russian military-contracting company Wagner that’s playing a key role in the fighting in Ukraine, said it will take Russian forces up to two years to take control of the Donetsk and Luhansk regions. 

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In a rare interview with a pro-Kremlin video blogger, Prigozhin was asked what he thinks is the goal of Putin’s war, and how long it will last. “Everybody has a different view of the special operation,” he said. “As far as I understand, we need to take the Donetsk and Luhansk republics, and in principle everybody will be satisfied with this.” 

Prigozhin also said that Wagner has stopped recruiting prisoners to send to the front lines, though he added that the Defense Ministry is now hiring them. 

Ukraine Says It Downed 61 Cruise Missiles (1:22 p.m.)

Russia launched 71 cruise missiles, as many as 35 S-300 missiles and seven drones, Valeriy Zaluzhnyi, commander-in-chief of Ukraine’s armed forces, said Friday on Telegram. Cruise missiles were fired from strategic bombers and from ships in the Black Sea. Ukrainian forces shot down 61 cruise missiles and five drones, he said. 

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Prime Minister Denys Shmyhal had said earlier on Telegram that high-voltage infrastructure in the country’s western, central and eastern regions had been damaged, causing interruptions with power supply.

Romania Says ‘Aerial Target’ Was Never In Its Airspace (12:30 p.m.)

Romania’s defense ministry said it detected an “aerial target, most likely a cruise missile launched from a Russian warship in the Black Sea,” early Friday, but that the projectile didn’t cross into its airspace “at any time.” The missiles were never within 35 kilometers (22 miles) of the northeast Romanian border, it said. 

The “target” flew over Ukraine, then Moldova, “after which it reentered Ukrainian space without crossing into Romania’s airspace,” the NATO member said in a statement. 

Romania said it rerouted two MiG jets to the north of the country to increase “reaction options,” but that once the situation was clarified the jets resumed their initial mission.