The end of Russian military exercises near the Ukrainian border and Vladimir Putin’s statement that force would only be used as a very last resort seemed to have taken some of the tension out of this crisis but the situation remains on a knife edge.
Moscow chose to test fire an intercontinental ballistic missile though Washington said it had been notified of plans to do so before the standoff in Crimea blew up. And there is always the possibility of conflict being triggered inadvertently.
Yesterday, a Russian soldier fired three volleys of shots over the heads of unarmed Ukrainian servicemen who marched towards their aircraft at a military airfield surrounded by Russian troops near Sevastopol.
Markets calmed after a rout of Russian assets on Monday during which the central bank says it blew $11.4 billion of reserves defending the rouble as well as whacking up interest rates. The currency is steadyish this morning while Russia’s stock market is down about 1 percent, which is a modest move in this sort of environment.
It’s not clear what Putin’s end game is and whether he can extricate himself from this standoff without losing face. Russian Foreign Minister Sergei Lavrov and his Spanish counterpart will hold a morning news conference at 0830 GMT and Lavrov will then fly to Paris for a conference, ostensibly on Lebanon, which U.S. Secretary of State John Kerry is also attending. France’s foreign minister meets the acting Ukrainian foreign minister this morning.