Caviar, "Varyag," And Shanghai

What's Behind Putin's Tour.

Since late July, Putin has visited at least seven cities in Siberia and the Far East. Putin’s tour began in Irkutsk and Omsk and concluded on September 3 with his participation in the Eastern Economic Forum in Vladivostok. Kremlin media covered the trip with their usual bombast and fanfare, but Putin’s travels themselves clearly demonstrated his detachment from reality and his unwillingness to acknowledge the mounting economic difficulties in Russia caused by the war against Ukraine.

For example, on Iturup—the largest of the Southern Kuril Islands—Putin visited a fish-processing plant and tasted salmon caviar, but made no mention of the steadily rising price of this popular product. Soon after, Russian media reported a sharp decline in fish catches in the region and a new spike in caviar prices, partly due to rising costs of marine diesel fuel.

Meanwhile, Japan, which considers these four islands to have been illegally annexed by the Soviet Union during World War II, responded with a harsh reaction to Putin’s first-ever visit to the Southern Kuril Islands, marking a new record low in bilateral relations.

On August 12, Putin observed the final stage of the Pacific Fleet’s exercises off the coast of Sakhalin. In response to recent detentions of “shadow fleet” tankers by European countries, he threatened a “mirror response,” calling such actions “piracy.”

On board the *Varyag*—the fleet’s flagship, named after a cruiser that participated in the first battle of the Russo-Japanese War of 1904— — Putin referred to the history of his famous predecessor, which is shrouded in numerous myths. He attempted to revive an old legend claiming that Russian sailors scuttled their own ship to prevent it from falling into enemy hands.

In reality, however, the cruiser sustained only minor damage in a brief engagement with the Japanese, who subsequently salvaged it with ease, renamed it the “Soya,” and incorporated it into their fleet.

Putin’s references to the Russo-Japanese War—which ended 121 years ago with Russia’s defeat and the signing of the Treaty of Portsmouth, brokered by the United States—seem particularly paradoxical against the backdrop of Russia’s current war against Ukraine.

Kyiv itself reinforced this historical parallel: on the day of Putin’s visit to the “Varyag,” Ukrainian forces struck the frigates “Admiral Makarov” and “Admiral Essen” in Novorossiysk Bay, after which Russia’s Black Sea Fleet was left without a single operational large surface combatant.

The most high-profile event of Putin’s tour was the Shanghai Cooperation Organization (SCO) summit in Kyrgyzstan, which was notable for its excessive pomp and a clear lack of substantive content.

Putin’s top priority was a meeting with the General Secretary of the CPC Central Committee Xi Jinping. Russian media reported that the leaders were supposed to discuss finalizing the deal on the construction of the “Power of Siberia 2” gas pipeline, designed to transport Russian natural gas from the Arctic fields of Yamal through Mongolia to China.

Putin and Xi exchanged the usual assurances regarding the strength of the Russian-Chinese strategic partnership; however, following the SCO summit, the gas pipeline contract remained in a state of “high readiness.” Putin also held a series of bilateral meetings and expressed solidarity with Iranian President Masoud Pezeshkian.

As for the talks with Indian Prime Minister Narendra Modi, which were intended to lay the groundwork for Putin’s visit to India this month, Modi’s call to end the war against Ukraine left the Russian dictator in a sort of diplomatic impasse.

The Eastern Economic Forum in Vladivostok was supposed to provide Putin with a platform to address Asian investors and promote projects such as the Amur Gas Chemical Complex—a joint venture between Russia’s SIBUR and China’s Sinopec. However, on August 25, a massive fire at the Amur facility claimed the lives of at least 15 people and derailed the planned ceremonial launch of the project on the sidelines of the forum.

This demonstrated that, although the Far East is generally out of reach of Ukrainian drones, Russia’s struggling economy continues to pose serious risks to foreign investors.

Putin’s assurances that the oil refineries damaged by Ukrainian strikes will be quickly restored are contradicted by the onset of a second wave of the fuel crisis, which shows no signs of abating. The more Putin relies on top-down directives in an attempt to resume economic growth and launch a new investment cycle, the greater the risk that anxiety among officials, business representatives, and ordinary consumers will begin to manifest in politically destabilizing actions.

The economic downturn in Russia is weakening its position in peace negotiations. According to reports, CIA Director John Ratcliffe attempted to convey this to Russian intelligence chiefs during a visit to Moscow on August 25.

Putin apparently refused to meet with Ratcliffe, but on September 5 he met with U.S. special envoys Jared Kushner and Steve Whitcoff. The next day, Kushner and Whitcoff traveled to Kyiv for the first time. Expectations that Putin would agree to a reasonable compromise remained low, but there was considerable interest in engaging with the American negotiators.

Moscow-based commentators closely followed the candid conversation with Ukrainian President Volodymyr Zelenskyy, which was also joined by high-ranking representatives from France, Germany, and the United Kingdom.

The main problem for mediators is that Putin’s perceptions of the war’s progress are increasingly at odds with reality. Russians see no way out of this impasse: although the majority supports ending the Kremlin’s war against Ukraine, almost everyone understands that it will last for more than another year.

Europeans are quite rightly alarmed by the escalation of Russian provocations, sabotage, and election interference. For the United States, Putin’s intention to pivot toward China and the Asia-Pacific region as a whole poses a serious challenge. However, setbacks in implementing this course point to a larger problem: Putin’s war against Ukraine remains the main focus of all Russian policy.

Moscow has focused the bulk of its efforts on avoiding defeat in this senseless and obviously unwinnable confrontation, which has left Siberia and the Far East bled dry—deprived of investment, resources, and people. Direct signals from India, Turkey, and even Kazakhstan regarding the senselessness and danger of continuing the war reinforce the messages coming from Washington: each subsequent version of a peace plan will cost the Kremlin increasingly serious and painful concessions.

Pavel Baev, New Voice

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