The dramatic increase in tensions between Russia and Ukraine in the Kerch Strait has reached levels compared to the Crimean annexation; however, tensions in the strait are not a novelty for both countries. Problems in the Azov Sea began in March this year, when Russia finished building its 12-mile bridge in the strait to connect mainland Russia to annexed Crimea as a way to declare permanence in the Crimean territory. In addition to this, the bridge is only 33 metres tall, which means that several Ukrainian ships harbouring in the Ukrainian cities close to the strait have been blocked from shipping grain to Turkey, their main shipping destination. According to the Economist Intelligence Unit, the amount of Ukrainian grain exports hampered by the construction of the bridge is almost 9%.
In 2003, both countries agreed to sign a treaty that allows their merchant ships and warships freedom of navigation in the Sea of Azov and the Kerch Strait; the seizing of the Ukrainian navy vessels is in breach of that treaty. However, since the annexation of Crimea, Russia has increased controls in the strait for national security reasons, something Ukraine is very aware of, but strangely refused to acknowledge on Sunday (25 November).
Oddly, the situation benefits the leaders of both countries. President Putin’s approval ratings show that only 58% of Russians have faith in the president, the lowest level since 2012. The mistrust comes from the recent pension reform, which has increased the pension age for men from 60 to 65. Putin might be aiming to increase popular support with this show of force on the Kerch Strait, a strategy that worked very well for approval ratings when Russian troops seized Crimea in 2014. Similarly, President Poroshenko might have purposely sent the navy vessels to provoke Russia and rally national support on the issue, as his current popular approval for the upcoming presidential elections in March 2019 is at 9.2%. Initially, the president also wanted a two-month martial law to be invoked, but had to compromise with the opposition on a 30-day period because it was seen as a blatant way to delay the elections.
We believe the tensions are likely to remain for quite some time, into the early months of 2019E, but escalation is quite unlikely as neither country has any reason to resort to military force. Russia already has to face looming sanctions from the US for the Salisbury nerve attack, and a tougher round of US-EU sanctions might be too much to bear economically. Ukraine is Europe’s poorest country already, and any sort of military conflict can only aggravate its position.