(Bloomberg) -- The US announced $4.5 billion in additional direct budgetary support to Ukraine and $1 billion more in military aid drawn from existing Pentagon inventory.

Russia told diplomats it’s ready to welcome international monitors at Ukraine’s Zaporizhzhia nuclear power plant, which the International Atomic Energy Agency said was at risk of a “nuclear disaster” after it was shelled last week.

Ukraine’s sea port of Pivdennyi said the first cargo ship left its waters since Russia’s Feb. 24 invasion as commodity shipments from the war-torn country kick into higher gear. 

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

Key Developments

  • Russia Invites Nuclear Monitors to Visit Shelled Ukrainian Plant
  • Grain Corridors Still Need Ships to Ease Food Crisis
  • Sanctions May Freeze Veon’s Network Rollout in Russia, CEO Says
  • Turkish Banks Are Adopting Russian Payments System, Erdogan Says
  • Russian Weapon Systems Rely Heavily on Foreign Tech, Report Says

On the Ground

The Russian military pushed further into settlements to the northwest and southwest of Donetsk and continued efforts to break Ukrainian defensive lines along the Avdiivka-Donetsk city line of contact, the Institute for the Study of War said. Kremlin forces unsuccessfully attempted to advance east of the city of Mykolaiv. Ukraine said it hit two bridges in the southern Kherson region -- now occupied by Russia -- that serve as important crossings for Russian supplies, military spokeswoman Natalia Humenyuk said. Ukrainian troops also destroyed several Russian munition depots, she said without elaborating.

(All times CET)

US Providing $4.5 Billion More in Direct Budget Support (7:48 p.m.)

The US is providing Ukraine an additional $4.5 billion in direct budgetary support, using a World Bank-managed program to mobilize the funds.

The first $3 billion will be distributed this month, and is the fifth US disbursement to the Ukrainian government, the US Treasury said in a statement. 

“This economic assistance is critical in supporting the Ukrainian people as they defend their democracy against Russia’s unprovoked war of aggression,” Treasury Secretary Janet Yellen said. Once the additional funds are fully disbursed, the US will have provided a total $8.5 billion in direct budgetary support to Ukraine.

Russia ‘Temporarily’ Halts US Inspections Under Nuclear Pact (7:21 p.m.)

Russia said it has informed the US that it is halting American inspections of its nuclear weapons sites under the New START treaty in protest at what it described as efforts by Washington to maintain unequal access.

The Foreign Ministry in Moscow said the ban on flights from Russia to the US and allied countries and visa restrictions for transit countries meant that Russian inspectors are unable to travel to the US, while American inspections are proceeding unhindered.

“We would like to stress that these are temporary measures,” the ministry said in a statement on its website.

US Giving Ukraine $1 Billion More in Weapons From Inventory (7:20 p.m.)

The US is preparing $1 billion more in military aid to Ukraine, the largest drawdown from existing inventories since Russia’s invasion, according to the Pentagon.

The package includes long-range artillery munitions, anti-tank weapons and medical vehicles and supplies, the Defense Department said in a statement.

It’s the 18th drawdown of Pentagon inventories since August 2021 and brings the total of US security assistance to Ukraine under the Biden administration to about $9.8 billion.

Russian Weapons Rely on Foreign Tech, Report Says (5:27 p.m.)

Russian military systems depend highly on microelectronics components designed and produced in the US, Europe and east Asia, according to a report based on an examination of the remains of equipment used by the Kremlin’s forces in Ukraine. 

The report by the Royal United Services Institute in London inspected 27 weapon systems, including state-of-the art cruise missiles and drones that were used since Russian President Vladimir Putin invaded Ukraine in February. It found at least 450 foreign-made components that were critical to their operation. 

Mediterranean Buyers Return for Russian Crude (4:45 p.m.)

Oil buyers in southern Europe are quietly returning to the market for Russian crude, with a European Union ban on such shipments still four months away. Shipments of Russian crude to ports in Italy and Turkey rose to multi-week highs in the seven days to Aug. 5, offsetting another drop in shipments to customers in northern Europe, according to vessel-tracking data monitored by Bloomberg.

Shipments from Russia to the Mediterranean region as a whole were the highest since mid-June. Deliveries of crude from export terminals in the Baltic and Black Sea to refineries in Italy rose to a seven-week high, while shipments to Turkey were the biggest in six weeks. Spain took its first cargo of Urals crude since April.

Ukraine Applies for New Loan Program With IMF (3:50 p.m.)

Prime Minister Denys Shmyhal sent a formal letter to the International Monetary Fund on Friday asking for a new special aid program, and he expects the arrival of funds in November or December. Ukraine needs tens of billions of dollars in international aid to support an economy hammered by Russia’s invasion.

Ukraine aims to reach a deal for $15-$20b IMF financing program before year-end, Reuters reported last month, citing central bank governor Kyrylo Shevchenko.

Grain Vessel Rejected, Another Reaches Destination (2:32 p.m.)

The final buyer of grain carried by the vessel Razoni rejected the cargo due to a five-month delay in its delivery, Ukraine’s embassy in Lebanon said in a statement on Twitter. The ship – which is currently in the Mediterranean Sea -- had been the first agriculture vessel to leave Ukraine under the newly-established corridor for grain exports. The shipper is now looking for another consignee, the embassy said.

Meanwhile, another crop vessel from Ukraine – the Polarnet -- has reached its final destination in Turkey after clearing inspection in Istanbul, Ukraine’s Infrastructure Ministry said. Two other grain ships that left in the same caravan are expected to reach their destinations in about a week.

Ukraine Reopens Stock Exchanges, Renews Bond Trading (2:04 p.m.)

Two Ukraine’s leading stock exchanges known as Ukrainian Exchange and PFTS resumed operations. Both suspended trading on Feb. 24 when Russia invaded. Ukraine’s stock-exchange authorities also allowed the trading of government bonds to resume to help the war-battered economy.

Russia Says It Will Welcome Monitors at Nuclear Plant (1:06 p.m.)

The Kremlin’s envoy to the IAEA has invited an international mission to Zaporizhzhia -- the world’s largest nuclear plant -- to conduct “activities within the framework of the implementation of safeguards, as well as monitoring the state of nuclear safety and security,” according to a note circulated among diplomats in Vienna. 

The president of Energoatom, the operator of the power station, called on partners to set up a demilitarized zone at the facility and for the presence of peacekeepers as well as experts from the IAEA and other organizations to take control of the situation.

Energoatom State Enterprise President Petro Kotin said on television that there are as many as 500 Russian soldiers and about 50 pieces of heavy military equipment at the site. The IAEA warned yesterday of “potentially catastrophic consequences” after shelling that Ukrainian officials blamed on Russia.  

Ukraine’s Port of Pivdennyi Resumes Crop Shipments (8:34 a.m.)

The first cargo ship departed from the port Pivdennyi since Russia’s invasion, becoming the third port to do so, the nation’s Infrastructure Ministry said on its Telegram channel. 

The ministry hopes the move will help Ukraine to ship up to 3 million tons of grain per month.

More Grain Ships Depart From Ukraine (7:12 a.m.)

Two more grain ships departed from Ukraine ports Monday morning, Turkey’s Defense Ministry said in a Twitter post. 

The Sacura is carrying 11,000 tons of soy to Italy, and the Arizona is carrying 48,458 tons of corn to Iskenderun in southern Turkey, the ministry said.

US Senators Seek to Label Russia Terrorism Sponsor (4 p.m.)

Two US senators renewed a bipartisan call for President Joe Biden’s administration to declare Russia a state sponsor of terrorism.

“The administration should, in effect, say to Russia, we’re making you a pariah, like Iran and Cuba,” Connecticut Democrat Richard Blumenthal said on CNN’s “State of the Union.” The designation would mean in part that “you can go to American courts and sue Russia for the damage done in Ukraine,” South Carolina Republican Lindsey Graham said.  

Blumenthal and Graham championed a Senate resolution passed in July that calls on the administration apply the label to Russia. It cites a series of military actions under President Vladimir Putin, including the war in Ukraine.


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