July 2nd, 2024

1776 - The Continental Congress Votes for Independence 

(the Declaration would not be voted on for 2 more days)

Overall 

Ground Operations - Marginal Russian gains continue

Air Operations - Dutch F-16s “soon”

Politics - Orban meets with Zelenskyy

Weather

Kharkiv

90 and sunny. Cloudy to partly cloudy next three days, then sunny through the weekend. Lows around 70, highs in the low 90s. Winds variable, 5-10kts.

Melitopol

94 and mostly sunny. Sunny to Partly cloudy through the weekend. Daily lows around 70, highs in the low 90s. Winds variable, 5-15kts.

Kyiv

79 and cloudy. Partly cloudy to cloudy for the next three days, rain possible tonight. Daily lows around 70, daily highs in the mid 80s.  Winds variable, 5-10kts.

Ground Operations 

North of Kharkiv

Fighting continued in border areas north and north-east of Kharkiv but there were no confirmed changes in terrain held. 

Video has confirmed that Ukrainian forces were firing on positions about a mile inside Ukraine, north-east of Sumy, but whether this was a lead element of a larger Russian unit, or a special operations element, or something else, or even if there were still Russians there, is not clear.

Donets river

Fighting continues along the entire line of contact and video and reports show that the see-saw actions continue, with Ukrainian forces regaining ground east of Terny and inside the Serebriankse forest in the last few days, and they may have lost some of that regained land in the forest just yesterday. Several small towns just west of the P07 roadway, south-east of Kupyansk, also appear to be in contention once again, with contradictory reports as to who controls what.

Bakhmut

North and west of Bakhmut saw more hard fighting yesterday but again, there were no confirmed gains or losses by either side. Reports claim that just north-east of Chasiv Yar that Russian forces have forced Ukrainian elements to withdraw from the area of Kalynivka, and that Russian forces have also pushed across the canal due west of Ivaninvske - but neither of these reports has been confirmed.

To the south - west of Horlivka - fighting continues near Toretsk and near Pivnichne, but again, there were no confirmed gains or losses of terrain.

Donetsk City

West and north of Avdiivka Russian forces continue to grind out small gains and fighting continues in a broad arc of small towns about 10 miles out from Avdiivka to the north-west and west.

South-west of Donetsk City fighting continues in and around a number of towns (Heorhiivka, Paraskoviivka, Kostyantynivka, and Vodyane) and Russian forces inside Krasnohorivka appear to have moved past the center of the town and are probably starting to consolidate their hold; fighting is reported to be very heavy in and just east of Kostyantynivka.

Velyka Novosilke (VN)

Fighting continues in a broad arc south of VN, and Russian forces continue to push north from Staromaiorske, and push further into Urozhaine.

Orikhiv

Fighting continues north of Robotyne and there are unconfirmed reports of Ukrainian forces being pushed out of their positions south of Mala Tokmachka, but this has not been confirmed. Male Tokmachka is about 4 miles south-east of Orikhiv, along the T0815 roadway. The Ukrainian positions are south of the town several miles, sitting just south of the T-803 roadway - 803 and 805 are basically parallel roads in this area of Ukraine.

Dnepr River

Fighting continues around Krynky and on several islands in the Dnepr River but there were no confirmed changes in position of either side.

Air Operations 

The Dutch will begin delivery of 24 x F-16s “soon,” but Defense Minister Ollongren would not give specifics on when the first aircraft would be turned over nor how many would be turned over this summer.

The UAF and RuAF traded strikes at airfields, with Ukrainian missies striking airfields near Sevastopol and Balaklava, and Russian missiles striking Mirgorod airbase near Poltava (an SU-27 base), and Konatovo airfield (the UAF SU-24 base), but there were no details on number of missiles launched or types of damage, though both sides claimed to have destroyed enemy aircraft at the various airfields. 

The UAF later commented that the Russians launched at least 6 missiles at 4 separate targets, 1 x Kh-59/69 was shot down by the UAF over eastern Ukraine, but there were no further details on types of missiles; the UAF also noted that there were at least 33 air strikes - but again provide no further details.

At least one ballistic missile damaged a number of buildings in Dnipro yesterday, but there were again no details of the attack, or number and types of missiles.

Politics and Diplomacy

Prime Minister Orban of Hungary met with President Zelenskyy in Kyiv this morning; Orban traveling to Kyiv to mark the start of his six month term as president of the European Union Council.

During their meeting Orban once again urged a ceasefire or truce as a prelude to a negotiated settlement of the war. Orban commented:

"I informed Mr President that his plans require a significant amount of time due to international diplomatic rules. So I advised Mr President to consider doing something a bit differently: halt the fire, and then engage with Russia, because a ceasefire would speed the pace of these negotiations.”

Zelenskyy did not directly respond to Orban’s statement.

Chinese Foreign Ministry Spokesperson Mao Ning commented yesterday:

"NATO should think about the root causes of the Ukraine crisis and about what the alliance did for peace and security in Europe and the world over instead of dodging responsibility or shifting the blame for conflicts on others… NATO continues to outright challenge China as it interferes in its domestic affairs, distorting and discrediting China’s domestic and foreign policy and creating a major threat to its interests." 

NATO is "using ideological differences to ignite conflicts, spur confrontation or escalate tensions.”

As of 27 June the Ukrainian Armed Forces has received 3,171 parolees for training and military service.

Economic Reporting

Feb 22   Mar 7   Jun10-22Jun8-23 Sep8 Feb8 Apr8 Jun7 Jul1 Jul2

Brent      94.71      119.50 120.90    75.58      90.95   80.93 90.13 80.06 85.43 87.21

WTI     92.10      123.80 119.50  71.29      87.77   75.49 86.13 75.81 81.96 83.97

NG       3.97       4.45     8.41      2.15        2.63       1.95 1.83 2.82 2.58 2.45

Ruble     85         145.70  58.48     82.59      98.11     91.09 92.69 88.77 87.18 87.94

Wheat     8.52        12.94    10.71    6.17        6.00     6.02 5.67 6.40 5.74 5.90

Urals 56.56     74.34    66.28 77.31 67.61 67.61 67.61

ESPO   67.02     80.88     74.85 85.96 74.63 80.98 80.98

The World Bank has reclassified Ukraine from a lower-middle income nation to an upper middle income nation, as per capita Gross National Income (GNI) rose from $4,270 for the year ending June 2023, to $5,070 for the year ending June 2024.

Russia’s per capita GNI for the year that just ended was $14,250.

Ukraine has 1 month to restructure some $19.7 billion in debt to prevent default, but the general sense of the market is that this will be readily accomplished and the there is no real chance that Ukraine will default.

Thoughts

About those per capita figures, what is of note is that the World Bank gave the GNI for Ukraine as $174,919,000,000 - which means that the World Bank holds the Ukrainian population as 34,500,000, roughly the population the UN demographics model predicted for Ukraine in 2044. This sustained drop in population coupled with the rising GDP is responsible for the 18.7% increase in per capita GNI.

Ukraine’s population at the end of 2021 was 43,500,000 and 52,000,000 in 1993.

Russian forces have, over the course of the last year, withdrawn from perhaps 200 square miles of terrain as a result of the initial successes of the Ukrainian attacks last summer, and since then have regained much of that land and occupied some more. Overall, however, the amount of land the Russians have taken in the last year amounts to perhaps 300 sq. miles of land, a pittance compared to the “expenses.” Since Ukraine began their counter offensive in June of 2023, Russian losses (my estimate) have amounted to about 30,000 KIA and 100,000 WIA; Ukrainian losses (again, my estimate) have amounted to about 42,000 KIA and 140,000 WIA. It is worth noting that 20% of Russian casualties in the war so far have been convicts released to fight.

Looked at from the perspective of what the war costs and what they have gained, it appears that the real Russian "scheme of maneuver” is to kill as many Ukrainians soldiers as possible.

Russian forces - and their tactics - appear to be making good use of their engineers, who are, for example, already building trenches and robust fortifications in the Ukrainian border terrain north of Kharkiv. And the slow but steady Russian grind still is keeping the Ukrainian forces from digging in and stopping the advance. West of Avdiivka a host of rivers, reservoirs, ponds and marshy areas could have been developed into a nearly impossible series of obstacles, but the Russians appear to have made it past much of that immediate area. The necessity here is for the Ukrainians to pick a line far enough to the rear that their engineers have time to build comprehensive defensive lines, and the army can fall into them and then hold. Later perhaps they can claw that terrain back. But first they need to stop the Russian advance.

v/r pete