EXPLAINER: After Failed Kyiv Blitz, Russia Focuses on East

FILE - A Ukrainian serviceman walks next to the wreck of a Russian tank in Stoyanka, Ukraine, March 27, 2022. (AP Photo/Vadim Ghirda, File) THE ASSOCIATED PRESS
FILE - A Ukrainian serviceman walks next to the wreck of a Russian tank in Stoyanka, Ukraine, March 27, 2022. (AP Photo/Vadim Ghirda, File) THE ASSOCIATED PRESS
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EXPLAINER: After Failed Kyiv Blitz, Russia Focuses on East

FILE - A Ukrainian serviceman walks next to the wreck of a Russian tank in Stoyanka, Ukraine, March 27, 2022. (AP Photo/Vadim Ghirda, File) THE ASSOCIATED PRESS
FILE - A Ukrainian serviceman walks next to the wreck of a Russian tank in Stoyanka, Ukraine, March 27, 2022. (AP Photo/Vadim Ghirda, File) THE ASSOCIATED PRESS

With Russian hopes for storming Kyiv and other major cities in northern Ukraine dashed by stiff resistance, Moscow has refocused its efforts on the country's east, seeking to make gains there and use them to dictate its terms in talks on ending the conflict.

The Russian troops are preparing for a massive offensive in Ukraine's eastern industrial heartland known as the Donbas, and the coming weeks could determine the outcome of the war.

A look at the shift in the Russian strategy and its possible consequences.

When Russian forces invaded Ukraine from the north, east and south on Feb. 24. President Vladimir Putin counted on a quick victory, similar to its 2014 annexation of Ukraine's Crimean Peninsula.

The Russian troops that pushed into Ukraine from Moscow's ally Belarus quickly reached the outskirts of Kyiv, only 75 kilometers (47 miles) south of the border, but they got bogged down facing Ukrainian defenses.

After the failed attempts to storm the capital and other big cities in the north, Russian forces tried to encircle and pummel them with artillery and airstrikes. The relentless barrages led to massive civilian casualties and damaged infrastructure, but didn't weaken Ukraine's resolve. Ukrainian forces, meanwhile, successfully used artillery and drones against Russian convoys that stretched for dozens of kilometers (miles) along highways outside Kyiv. According to The Associated Press, that created massive logistical problems for the Russians.

A SHIFT IN STRATEGY

On March 29, Russia announced a drastic change in strategy, saying it would scale down military activities around Kyiv and Chernihiv, focusing instead on the “liberation” of Donbas.

A quick withdrawal from areas in the north and northeast followed, with forces pulling back to Belarus and Russia for rest and resupply.

Moscow sought to put a positive spin on what Ukrainian and Western officials described as the failure of the offensive. Russia said the action in the north was intended to tie down and weaken Ukrainian forces there and prevent them from joining troops engaged in the fighting in the east.

REDEPLOYMENT AND REGROUPING

Observers said it could take Russian troops several weeks for the troops to rest, resupply and regroup before they could launch a new attack in the east.

“Many Russian units withdrawing from northern Ukraine are likely to require significant re-equipping and refurbishment before being available to redeploy for operations in eastern Ukraine,” a tweet from the British Ministry of Defense said.

Some Western estimates said nearly a quarter of Russian units involved in the fighting had been rendered unfit for further action and would need long reequipment and resupply before being sent back into combat.

“They will be remanned because they have lost a lot of troops in the different units,” NATO Secretary-General Jens Stoltenberg said. “They will be rearmed because they have used a lot of ammunition and they will be resupplied ... to launch a new big offensive.”

FORTRESS EAST

The separatist conflict in eastern Ukraine, home to a mostly Russian-speaking population, began in 2014 shortly after the annexation of Crimea and has killed over 14,000 people. The fighting has tempered Ukrainian forces, which have gained ample combat experience and built multilayered defenses along the line of contact.

Those efforts paid off at the start of the Russian invasion, preventing the separatist forces and Russian troops from making any significant gains there despite far superior firepower.

From the start of the invasion, Moscow's key goal was to capture the Sea of Azov port of Mariupol to secure a coastal corridor to Crimea. Russian troops have besieged Mariupol for a month, reducing much of the city to rubble with artillery and air raids that killed thousands. So far, however, they have failed to win full control.

RUSSIAN PINCER MOVEMENT

Ukrainian and Western officials say the Russian plan is to encircle tens of thousands of Ukrainian troops in Donbas by moving from Izyum, near Kharkiv in the north, and from Mariupol in the south.

The timing for the offensive depends on how quickly the Russians wrap up the battle for Mariupol and free those forces for the offensive. It also will depend on how much time is needed to resupply and regroup the troops that were pulled back from Kyiv and other areas in the north.

The Washington-based Institute for the Study of War said in an analysis that the Russian troops will likely try to advance from Izyum to capture the strategic city of Slovyansk and link up with other Russian forces in Donbas in what it said “will likely prove to be the next pivotal battle of the war in Ukraine.”

Stoltenberg warned that such an eastward shift by Russia marks a “crucial phase of the war,” saying a further push in eastern and southern Ukraine is expected ”to try to take the entire Donbas and to create a land bridge to occupied Crimea."

MOSCOW'S VULNERABILITIES

During an eastern offensive, Russian forces will face the same problems that hampered their attack in the north.

Maintaining supply lines over long distances under constant Ukrainian attacks was a key challenge that eventually doomed the blitz on Kyiv and forced Moscow's retreat. Such an operation in the east could prove just as hard.

The lack of proper cohesion among different forces, the failure to fully suppress Ukrainian air defenses, and the growing popular resistance to the invasion would likely make it difficult for quick Russian gains in the east. As they seek to encircle Ukrainian troops in Donbas, Russian forces could also face attacks on their flanks.

CONDITIONS FOR PEACE

A military success in the east could offer Putin a face-saving exit from the conflict, allowing him to claim that Moscow's main goals were fulfilled. He could argue that Russia has destroyed the bulk of the Ukrainian military, liquidated the “neo-Nazi nationalist” forces and “liberated” Donbas.

Putin’s conditions for peace, however, include a demand for Ukraine to acknowledge Russia’s sovereignty over Crimea and to recognize the independence of the eastern separatists regions, something that Ukrainian President Volodymyr Zelenskyy has rejected. Zelenskyy said the issues of Crimea and Donbas could be put on hold, but Moscow wants to make them part of a deal now.

TIME AS A FACTOR

Putin badly needs a quick success in the east to find a way out of the conflict that increasingly looks like a quagmire for Moscow. Time is working against Russia, with each day of war worsening the massive economic damage from Western sanctions and draining its limited resources.

A protracted conflict could force the Kremlin to broadly engage the use of poorly trained conscripts, something it has tried to avoid, claiming that it relies squarely on volunteer soldiers. Sending fresh draftees into battle would be highly unpopular and likely fuel public discontent.

Putin's goal of freeing Ukraine from purported “neo-Nazis” has led some observers to predict that he hopes for quick gains in the east so he can announce a successful end to the campaign by May 9. That's when Russia celebrates its victory over Nazi Germany in World War II, its most important public holiday.



To Get Their Own Cash, People in Gaza Must Pay Middlemen a 40% Cut

A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)
A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)
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To Get Their Own Cash, People in Gaza Must Pay Middlemen a 40% Cut

A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)
A destroyed branch of the Bank of Palestine in the Tal al-Hawa neighborhood of Gaza City is seen Wednesday, July 9, 2025. (AP)

Cash is the lifeblood of the Gaza Strip’s shattered economy, and like all other necessities in this war-torn territory — food, fuel, medicine — it is in extremely short supply.

With nearly every bank branch and ATM inoperable, people have become reliant on an unrestrained network of powerful cash brokers to get money for daily expenses and commissions on those transactions have soared to about 40%.

"The people are crying blood because of this," said Ayman al-Dahdouh, a school director living in Gaza City. "It’s suffocating us, starving us."

At a time of surging inflation, high unemployment and dwindling savings, the scarcity of cash has magnified the financial squeeze on families — some of whom have begun to sell their possessions to buy essential goods.

The cash that is available has even lost some of its luster. Palestinians use the Israeli currency, the shekel, for most transactions. Yet with Israel no longer resupplying the territory with newly printed bank notes, merchants are increasingly reluctant to accept frayed bills.

Gaza’s punishing cash crunch has several root causes, experts say.

To curtail Hamas’ ability to purchase weapons and pay its fighters, Israel stopped allowing cash to enter Gaza at the start of the war. Around the same time, many wealthy families in Gaza withdrew their money from banks and then fled the territory. And rising fears about Gaza’s financial system prompted foreign businesses selling goods into the territory to demand cash payments.

As Gaza’s money supply dwindled and civilians’ desperation mounted, cash brokers' commissions — around 5% at the start of the war — skyrocketed.

Someone needing cash transfers money electronically to a broker and moments later is handed a fraction of that amount in bills. Many brokers openly advertise their services, while others are more secretive. Some grocers and retailers have also begun exchanging cash for their customers.

"If I need $60, I need to transfer $100," said Mohammed Basheer al-Farra, who lives in southern Gaza after being displaced from Khan Younis. "This is the only way we can buy essentials, like flour and sugar. We lose nearly half of our money just to be able to spend it."

In 2024, inflation in Gaza surged by 230%, according to the World Bank. It dropped slightly during the ceasefire that began in January, only to shoot up again after Israel backed out of the truce in March.

Cash touches every aspect of life in Gaza

About 80% of people in Gaza were unemployed at the end of 2024, according to the World Bank, and the figure is likely higher now. Those with jobs are mostly paid by direct deposits into their bank accounts.

But "when you want to buy vegetables, food, water, medication -- if you want to take transportation, or you need a blanket, or anything — you must use cash," al-Dahdouh said.

Shahid Ajjour’s family has been living off of savings for two years after the pharmacy and another business they owned were ruined by the war.

"We had to sell everything just to get cash," said Ajjour, who sold her gold to buy flour and canned beans. The family of eight spends the equivalent of $12 every two days on flour; before the war, that cost less than $4.

Sugar is very expensive, costing the equivalent of $80-$100 per kilogram (2.2 pounds), multiple people said; before the war, that cost less than $2.

Gasoline is about $25 a liter, or roughly $95 a gallon, when paying the lower, cash price.

Bills are worn and unusable

The bills in Gaza are tattered after 21 months of war.

Money is so fragile, it feels as if it is going to melt in your hands, said Mohammed al-Awini, who lives in a tent camp in southern Gaza.

Small business owners said they were under pressure to ask customers for undamaged cash because their suppliers demand pristine bills from them.

Thaeir Suhwayl, a flour merchant in Deir al-Balah, said his suppliers recently demanded he pay them only with brand new 200-shekel ($60) bank notes, which he said are rare. Most civilians pay him with 20-shekel ($6) notes that are often in poor condition.

On a recent visit to the market, Ajjour transferred the shekel equivalent of around $100 to a cash broker and received around $50 in return. But when she tried to buy some household supplies from a merchant, she was turned away because the bills weren’t in good condition.

"So the worth of your $50 is zero in the end," she said.

This problem has given rise to a new business in Gaza: money repair. It costs between 3 and 10 shekels ($1-$3) to mend old bank notes. But even cash repaired with tape or other means is sometimes rejected.

People are at the mercy of cash brokers

After most of the banks closed in the early days of the war, those with large reserves of cash suddenly had immense power.

"People are at their mercy," said Mahmoud Aqel, who has been displaced from his home in southern Gaza. "No one can stop them."

The war makes it impossible to regulate market prices and exchange rates, said Dalia Alazzeh, an expert in finance and accounting at the University of the West of Scotland. "Nobody can physically monitor what’s happening," Alazzeh said.

A year ago, the Palestine Monetary Authority, the equivalent of a central bank for Gaza and the West Bank, sought to ease the crisis by introducing a digital payment system known as Iburaq. It attracted half a million users, or a quarter of the population, according to the World Bank, but was ultimately undermined by merchants insisting on cash.

Israel sought to ramp up financial pressure on Hamas earlier this year by tightening the distribution of humanitarian aid, which it said was routinely siphoned off by militants and then resold.

Experts said it is unclear if the cash brokers’ activities benefit Hamas, as some Israeli analysts claim.

The war has made it more difficult to determine who is behind all sorts of economic activity in the territory, said Omar Shabaan, director of Palthink for Strategic Studies, a Gaza-based think tank.

"It's a dark place now. You don't know who is bringing cigarettes into Gaza," he said, giving just one example. "It's like a mafia."

These same deep-pocketed traders are likely the ones running cash brokerages, and selling basic foodstuffs, he said. "They benefit by imposing these commissions," he said.

Once families run out of cash, they are forced to turn to humanitarian aid.

Al-Farra said that is what prompted him to begin seeking food at an aid distribution center, where it is common for Palestinians to jostle over one other for sacks of flour and boxes of pasta.

"This is the only way I can feed my family," he said.