In Donetsk

Most informed sources in Ukraine and Russia believe that the annexation of Crimea was planned and carried out by the siloviki (former KGB and security service officials close to Putin), and not by the foreign policy elite (including the foreign minister, Sergei Lavrov, and defence minister, Sergei Shoigu), whose influence has been waning since Putin veered to the right in the wake of the 2011-12 anti-government protests.

A senior figure in the Yeltsin group told me that Putin is using the Ukraine crisis to cleanse the elite and to consolidate his support with the non-metropolitan public at large. It is no coincidence that the last few weeks have seen the Russian authorities cracking down on liberal and internet media.

A former intelligence officer told me that influential members of the president’s inner circle, such as Sergei Ivanov, Nikolai Patrushev and Igor Sechin, view the confrontation with the United States and European Union as a good thing for Russia, an opportunity to make a long-advocated turn towards China.

Putin calculated that the United States would not respond militarily to the annexation of Crimea. Even so, it would have been possible to take control of the peninsula by more delicate means, which wouldn’t have led to international isolation for Russia. But that is not what the siloviki wanted. Moscow is drawing a line around what it considers vital (including Ukraine), and its actions there will be non-negotiable. The siloviki regard Western sanctions talk as a scare tactic and they expect the United States to back down eventually.

Events are moving fast in eastern Ukraine, but in a series of conversations on Monday, the Kremlinologists I spoke to expressed the unanimous view that an escalation of military conflict between Russia and Ukraine beyond the Crimean peninsula is unlikely. However, a Ukrainian colleague in Donetsk referred to the atmosphere ‘darkening’ in eastern Ukraine since the beginning of April, with evidence of both governments (in Moscow and Kiev) provoking violence between Russians and Ukrainians.

The Donetsk-based observer, who has links to the circle around the interim Ukrainian president, Olexander Turchinov, said that Turchinov, a former head of Ukraine’s SBU security services, had ‘proof’ of an orchestrated ‘second stage’ in Russia’s plan to destabilise the major cities in Ukraine’s Russian-speaking industrial heartland and overthrow the regional administrations in Donetsk, Kharkiv and Lugansk, where the seizure of government buildings on 6-7 April was co-ordinated by Russian security services. This is part of a campaign to pressure Kiev into approving the ‘federalisation’ of Ukraine, giving the eastern and southern regions broad powers of ‘autonomy’ – effectively ceding control to Russia. It seems clear that Ukraine will have to decentralise in one way or another, but Yulia Tymoshenko and her followers are firmly opposed to federalisation, which they say will lead to ‘dozens of Crimeas’.

The former Russian intelligence officer I spoke to said that in his opinion ‘there is a contingency plan, but no intention, for our troops to cross the border and seize the territory of eastern Ukraine.’ He said that last week’s movements of forty thousand Russian soldiers massed near the Ukrainian border were not only ‘training exercises’ but also routine ‘rotations’ of mostly conscript troops, as opposed to the professional soldiers who crossed the border into Crimea a month ago.

Russia’s reformed special forces are far superior to the ragtag army divisions that invaded Georgia in 2008, with much improved funding, organisation and professionalism – Nato’s top commander, General Philip Breedlove, says they could seize southern and eastern Ukraine within three to five days – but even so my sources believe that Crimea was a unique case. The siloviki reckon that playing on the threat of an invasion that’s not going to happen will do more to destabilise Ukraine than ordering jittery Russian soldiers to point guns at their Slav brothers – which could backfire anyway. (All the same, Russia might intervene militarily in response to aggression from the government in Kiev, which makes the reports of shootings in eastern Ukraine especially worrying.)

A retired senior analyst on Russia’s foreign and defence policy committee says that Russia’s ‘virtual invasion’ (using economic aggression) began when it abolished the zero duty on gas for Ukraine on 3 April. This will automatically raise the price to $485 per 1000 cubic metres, an increase of more than $200 since last week.

My sources in Moscow say there is no evidence that Russia will cut off gas supplies to Ukraine, still less to Europe, as a result of the dispute over Kiev’s unpaid $2.2 billion gas bill. A source at Naftogaz, the Ukrainian state oil and gas company says that imports and transit of Russian gas are proceeding ‘as normal, for the moment’ (Gazprom delivered up to $10 billion worth of gas to Ukraine in 2013). All this could change in the event of a serious escalation of the military and political crisis, which could subject Ukraine’s gas transit pipeline to closures and attacks.

Ukraine has always said the Gazprom-Naftogaz contracts were unfair. They were negotiated in January 2009, and don’t expire until January 2019. Russia granted a 30 per cent price discount in April 2010, in exchange for prolonging the Russian Black Sea naval base lease; Yanukovich negotiated a further discount, in December 2013, as part of his disastrous turn towards Moscow.

A Russian energy expert says it will be difficult for Ukraine to do anything about its dependence on Russian gas in the short term. He scoffed at the suggestion that the EU could reverse the flow along one of the pipelines that take Russian gas to Slovakia via Ukraine. That would breach the terms of the Gazprom contract, he said, and Gazprom would never allow the reverse flow, which it could easily monitor. Slovakia would have to put up a metering station, which would cost $30 million and take a year to build. Besides, the EU is even more dependent on Russian gas than Ukraine. As for oil, many European refineries were built specifically to use Russian Urals crude so it would require a massive investment to switch to any other kind.