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Putin is cornered – here’s why that’s bad news for Ukraine – and us
For the first time in years of war, the Russian regime looks as if it is on the verge of an internal split as the Kremlin’s political managers struggle to reconcile the voracious military need for money with maintaining social and economic stability. But there is extreme danger when an opponent is backed into a corner, writes Owen Matthews
One morning early last week, Moscow motorist Igor Karpov rose before dawn to join a queue to buy petrol. Twenty litres per car was the maximum allowed after weeks of Ukrainian drone strikes knocked out or damaged almost all the refineries in European Russia. In all, Karpov, a retired engineer and businessman, spent six hours filling the tank of his Mitsubishi SUV, plus a couple of canisters for emergencies.
“I’ve been seeing a great energy superpower in action,” says the 61-year-old Karpov sarcastically. “But I should be grateful – waiting in line for gasoline made me feel like I was young again. In the Eighties, when I got my first car, we had to queue all night and buy ration coupons on the black market.”
For the first time in four years of war, ordinary Russians are starting to feel the pinch through fuel shortages, rising inflation and a stalling economy. Moscow’s fuel lines are nothing, as dozens of angry videos posted on the Telegram messenger app suggest, compared to 60-kilometre tailbacks in Krasnodar and a complete collapse of supplies in Dagestan, Tuva and other remote regions.
At the same time, the Kremlin’s political managers struggle to reconcile the voracious military need for money and bodies to maintain the war with Ukraine with maintaining the social and economic stability which Putin has made his political trademark.
Key to the latest escalating crisis is Kyiv’s recently found ability to accurately send small unmanned aerial vehicles to hit refineries, fuel stores and factories thousands of miles behind enemy lines. According to Novaya Gazeta, 31 of Russia’s 38 large refineries have been hit since January, and at least 78 of 83 regions are experiencing a fuel crisis.
Russia has resorted to importing expensive diesel from Belarus, Kazakhstan, China and India. A lack of fuel also reverberates through transportation, agriculture and the cost of living – compounding an economy already stalled under the pressure of sanctions and the cost of the war, which directly and indirectly now eats up over 45 per cent of the Federal budget.
Headline annual inflation is rising fast, with the cost of food soaring. At the same time, the Kremlin’s oil and gas revenues fell 38.3 per cent in the first four months of 2026 (despite a short price bump caused by the Iran war), according to Russia’s Finance Ministry, while the combined revenue of 28 of Russia’s largest companies fell 16.7 per cent compared to the previous year.
38.3%
The fall in Russia’s oil and gas revenues at start of 2026
Unsurprisingly, this is all having a growing political impact. Moscow’s Levada Center – the last independent polling group in Russia – reports that support for continuing military action has fallen to a record low of 24.3 per cent, with the majority of Russians now backing peace negotiations. That could spell trouble for the Kremlin as nationwide parliamentary elections loom in September. While serious political opposition is thoroughly banned in Russia, a large swing away from the ruling United Russia to “loyal opposition” parties would still represent a serious humiliation.
Open criticism of the Kremlin has become widespread and normalised in a way hitherto unseen since the beginning of the war. Starting with a slew of social media videos posted by influencers and once-loyal celebrities in Spring, Russian Telegram channels are now filled with footage of angry motorists venting about government corruption, shocked bystanders cursing the lack of air defences as drones smash into oil terminals, and even patriotic so-called “Z bloggers” laying into military incompetence and high-level mismanagement of the war.
Vladimir Putin’s response to all these signals has been denial. Last month, he acknowledged the fuel crisis for the first time – but called the shortages “temporary” and “not critical”. In recent appearances, he has also doubled down on his support for continued war.
The Kremlin’s iron control over Russia’s media and society remains solid. Ordinary Russians may be fatigued by the war, but the idea that Putin could ever face domestic unrest because he “lost” the war is – barring an unlikely total collapse of the Russian army – is still unthinkable. As a recently leaked policy paper from the Kremlin administration showed, the government has a detailed plan to cast almost any outcome as a victory.
Yet for all this discontent, Putin remains the ultimate decision maker – and shows no sign of bowing to the grumblers. On the contrary, he is preparing to intensify the war, not sue for peace
Trouble for Putin is much closer to home. In recent months, a number of reports have pointed to increasing tensions inside Russia’s elite between business interests exhausted and frustrated by the war and securocrats who profit from it – and who owe their power and incomes to continued conflict.
“Everyone is tired of the war,” a top government official recently told Kommersant Vlast magazine. “Nothing is happening. Everything seems to be stuck in some kind of jelly, going neither forward nor backward. Our advances are being more than offset by [Ukrainian] drone strikes.”
German Gref, CEO of the state-owned Sberbank, told shareholders on 30 June, “I don’t believe there is anyone in this country whose primary concern is anything other than an end to military hostilities as soon as possible.” And in a recent op-ed for The Economist, Russia’s eighth-richest man, “fertiliser king” Andrey Melnichenko, warned that Russia faces a “dead end” and called for “sovereignty” by elites and citizens over autocracy. According to the Carnegie Foundation’s Tatiana Stanovaya, “for the first time in years of war, the Russian regime looks as if it is on the verge of an internal split”.
Yet for all this discontent, Putin remains the ultimate decision maker – and shows no sign of bowing to the grumblers. On the contrary, he is preparing to intensify the war, not sue for peace. Last week, Reuters quoted two senior Kremlin sources, one of whom meets regularly with the president, predicting a “high probability” of escalation in the coming months.
Putin had “dug in his heels” on capturing the rest of Donetsk and had “recently rebuked a group of advisers suggesting a compromise based on a ceasefire along the current front lines”, one source told Reuters. The other said that Putin “needs some kind of victory”.
Voices in the Russian media are also backing escalation – including an attack on Nato bases in the Baltics and Romania and EU arms factories that supply Ukraine. And Kremlin spokesperson Dmitry Peskov told reporters earlier this month that “there is no doubt that escalation on the part of Europe is taking place”, claiming that Nato has “embarked on the path of militarisation and has dedicated itself to confrontation with the Russian Federation …we cannot turn a blind eye to this”.
Objectively, nothing would be more disastrous and counterproductive for the Kremlin’s war effort than initiating a direct provocation against any Nato country … But objectivity is not Putin’s strong point
Later this year, British ministers will launch a public information campaign to advise households on how to prepare for emergencies, including creating a stockpile of food, medicines and basic survival tools in case of a Russian cyber attack. Darren Jones, the chief secretary to the prime minister, announced on Tuesday that the Government would be wargaming a “hybrid” attack on the UK by a “foreign adversary” next year.
Objectively, nothing would be more disastrous and counterproductive for the Kremlin’s war effort than initiating a direct provocation against any Nato country. Such a move would reverse growing war fatigue and Ukraine-scepticism in many European countries, re-unite an increasingly fractured Nato and quickly prompt a further tightening of sanctions, thus transforming Russia’s economic problems into a death spiral.
But objectivity is not Putin’s strong point – as can be seen by his ironclad conviction that Russia is still winning. Indeed, according to Carnegie’s Stoyanova, Putin apparently reads Kyiv’s sudden increase in striking power as a covert Western attempt to undermine his position.
In a series of interviews that appeared in the year 2000 as the book First Person, Putin recalled the desperation of a rat he cornered in a Leningrad stairwell. “Suddenly it lashed around and threw itself at me. I was surprised and frightened. Now the rat was chasing me.”
Putin has used this anecdote to illustrate the extreme dangers of backing an opponent into a corner. But Western leaders have also cited the same parable to warn of Putin’s unpredictability and willingness to lash out if pressed too hard. “One thing should not be in doubt,” Peskov has recently said. “The reliable security of the Russian Federation and its national interests will be guaranteed in any case.” To Putin, despite the increasingly crippling economic and political cost, that means pushing on with his disastrous war until victory.
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