(Bloomberg) -- With Russia’s invasion into its 11th month, the International Monetary Fund is exploring a loan of as much as $16 billion to support Ukraine’s economy. It comes a week before a European Union-Ukraine summit, and as Russian President Vladimir Putin’s forces prepare for a new, lengthy offensive. 

Hungary’s prime minister warned that Western allies have become “part of the war” by sending “ever more modern” weaponry to Kyiv. Poland will send 60 PT-91 Twardy main battle tanks to Ukraine in addition to 14 previously announced German-made Leopard 2 tanks and more than 200 other tanks provided in 2022. 

The EU is exploring ways to create a special prosecution office to help investigate Russian war crimes in Ukraine. It also announced that economic sanctions against Russia will remain in place until July 31. 

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

Key Developments

  • Russian Refiners Churn Through Crude Ahead of EU Import Ban
  • Putin Braces for Long War as He Plans New Offensive in Ukraine
  • EU to Battle on Oil Price Caps, Sanctions in Push to Hurt Russia
  • IMF Weighs Ukraine Aid Package Worth as Much as $16 Billion
  • Yellen Positive on Cap Talks After EU Floats Russia Diesel Price
  • EU Weighs Prosecution Office to Help Punish Russian War Crimes 

On the Ground

Russian forces delivered 44 aviation strikes on Thursday including 18 Shahed drones, all of which were downed, General Staff said on Facebook. In a recent 24-hour stretch, Russia used 70 missiles against Ukraine of which 47 were shot down. The attacks caused civilian casualties and infrastructure damage. Russia used hypersonic Kinzhal missiles to hit energy targets in Kyiv and Zaporizhzhia, Air Defense spokesman Yuriy Ihnat said on TV, noting that Ukraine doesn’t have weapons to shoot those down. 

(All times CET) 

Defense Minister Meets Pentagon’s Inspector General (4 a.m.)

Ukraine’s defense minister, Oleksii Reznikov, wrote on Twitter Friday about his meeting in Kyiv with a US Defense Department delegation led by Robert Storch, the department’s inspector general. 

In his tweet, Reznikov said that Ukraine’s allies “continue to see for themselves that transparency & accountability are critical components of our policy.”

Storch, who was an inspector general for the National Security Agency and a deputy inspector general at the Justice Department, assumed his current role in December.

Ukraine May Export 5 Million Tons of Grain in January (5 p.m.)

Ukraine’s grain export may total near 5 million tons in January “despite complications” caused by Russia in the Bosphorus, Deputy Agriculture Minister Taras Vysotskyi said, according to the ministry’s website. Vessel wait times in the Bosphorus Strait sometimes add as much as $30 to $40 per ton of grain in additional costs, squeezing farmers.

Ukraine to Use Drone Hunter System to Protect Energy Facilities (3:45 p.m.)

Ukraine has obtained six systems to help detect and down Russian Shahed drones, Digital Transformation Minister Mykhaylo Fedorov said on Telegram. The protecting systems were purchased with money from the official government fundraising platform United24.

Russian Diesel Heads to Europe Ahead of Import Ban (3:40 p.m.)

Oil traders are sending huge amounts of Russian diesel to the EU, with an import ban on the fuel just days way. 

Countries from the bloc imported more than 600,000 barrels-a-day of diesel-type fuel from Russia in the first 23 days of this month, according to data from Vortexa Ltd. compiled by Bloomberg. That’s a little more than both the average imports for 2022 and arrivals over the same period last year, before Moscow’s troops invaded Ukraine.

Traders Cram Russian Diesel Into Europe as Import Ban Looms

EU Weighs Prosecution Office to Help Punish Russian War Crimes (12:14 p.m.)

The European Union is exploring ways to create a special prosecution office to help probe Russian war crimes in Ukraine while separate talks on a special international tribunal to punish crimes of aggression continue to be mired in legal wrangling.

Moves to set up the office, which would initially be charged with helping Ukraine collect evidence about Russian violence, gained broad support from EU nations this week, said people familiar with the talks. 

Read more: EU Weighs Prosecution Office to Help Punish Russian War Crimes

Orban Laments Allies’ ‘Drift’ Deeper Into War (11:50 a.m.)

Hungarian Prime Minister Viktor Orban said Ukraine’s allies have become part of the war through their expanding military support for Kyiv. Hungary, by contrast, “has avoided drifting into the war” by not directly supplying weapons, even though Budapest has provided financial assistance and failed to veto financing of EU weapons purchases for Kyiv. 

“If you send weapons and finance the full-year’s budget of one of the warring parties and you mull sending more arms, ever more modern ones, then you can say what you want, you’re part of the war,” Orban told state radio on Friday, calling instead for “peace talks.”

“It started with the Germans saying they were willing to send helmets,” Orban said. “Now, we’re at battle tanks, and they’re already talking about planes.”

Putin Demands Russia Oil Levy Rejig as Budget Deficit Widens (11:16 a.m.)

Putin demanded his government to come up with a plan for re-jigging Russia’s oil levies in a move to offset the effects from western energy sanctions on the nation’s budget revenues.

Officials were asked to prepare suggestions for a new method of assessing prices of Russian crude oil and products by March 1. The monthly price assessments are used to determine the level of oil taxes. 


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