Ukraine drone strikes test Putin’s resolve and raise escalation fears
Russian President Vladimir Putin attends a wreath-laying ceremony marking the 85th anniversary of the Nazi Germany invasion into the Soviet Union in World War II on the Remembrance and Sorrow Day at the Tomb of the Unknown Soldier by the Kremlin wall in Moscow on June 22, 2026.
Pavel Bednyakov | Afp | Getty Images
A string of political victories and deep-strike successes by Ukraine has revived hopes that the war could be shifting in Kyiv’s favor, though analysts warn that efforts to raise the conflict’s cost for Russia risk triggering further escalation.
After more than four years since Russia’s full-scale invasion, Ukraine launched an unprecedented drone strike on Gazprom’s Moscow Refinery, triggering a huge explosion and sending black plumes of smoke billowing into the sky over the Russian capital.
The attack, which blew the lid off a storage tank, showcased Kyiv’s enhanced mid- to long-range drone capabilities and extended a series of strikes on Russia’s energy infrastructure.
Ukraine has also stepped up its strikes on Crimea, which Russia seized by force in 2014, as part of a strategy to isolate the peninsula, and has benefitted from political tailwinds in recent weeks.
U.S. President Donald Trump signaled the potential for renewed American support of Kyiv, the election of Hungarian Prime Minister Peter Magyar removed a major obstacle to Ukraine’s integration into the European Union and Ukrainian President Volodymyr Zelenskyy received praise for turning the diplomatic tables on Russian President Vladimir Putin with an open letter that proposed face-to-face talks.
The end game is at hand and, therefore, we now have the risk of escalation.
Christopher Granville
Managing director at TS Lombard
An interim U.S.-Iran peace deal also appears to have pushed the Russia-Ukraine war back up the geopolitical agenda, while tumbling oil prices are seen as likely to cut into Moscow’s recent windfall.
Analysts, however, told CNBC that Ukraine’s depleted air defense constitutes a major obstacle to its battlefield success and the potential for Russia to escalate the situation even further remains a danger.
Grégoire Roos, director of the Europe, Russia and Eurasia programs at Chatham House, described the Ukrainian drone attack on the Moscow oil refinery as “the most interesting development over the past year.”
Black smoke rises from the area of the Russian oil producer Gazprom Neft’s Moscow oil refinery on the south-eastern outskirts of Moscow on June 18, 2026.
– | Afp | Getty Images
The incident underscored Ukraine’s growing military confidence, Roos said, as well as highlighting Kyiv’s understanding that it must continue to hit Russia “where it hurts the most,” by cutting Russia’s energy revenues.
“It’s a bad time for Russia. The number of bankruptcies of [small and medium-sized enterprises] has been on the rise,” Roos told CNBC in a phone interview.
Officially, Russia’s inflation rate came in at 5.6% year-over-year as of mid-June, lower than a month earlier,…
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