By Nandan Unnikrishnan and Aleksei Zakharov
Key Takeaways:
- After four-and-a-half years, the authors say the 2025 “Anchorage” talks are dead and the front is barely moving: Russia still wants all of Donbas, claims on Kostiantynivka are disputed, and drones have made big assaults rare.
- A late-June 40-day Ukrainian deep-strike campaign hit Crimea supply lines, distant refineries (Omsk is cited), warehouses, and Black Sea shipping; Russia answered with ports, grain terminals, petrol stations, and Kyiv-area raids as interceptor stocks run short.
- The predicted endgame is a ceasefire on the line of contact, a heavily armed Ukraine outside NATO, and a fragile European security deal—only after both sides decide more fighting no longer pays.
There appears to be no endgame in sight after four-and-a-half years of fighting in Ukraine, with peace negotiations making no progress in 2026. If anything, with both Russia and Ukraine escalating strikes on energy facilities, logistics infrastructure, warehouses, as well as ports and vessels in the Black Sea, a protracted war looks increasingly likely.
The so-called “Anchorage formula”, or, as the Russians call it, “the spirit of Anchorage”, referring to the understandings Russia claims were reached at the 2025 Trump–Putin summit in Alaska, is firmly dead, while a new baseline for negotiations remains undefined. Both Moscow and Kyiv remain confident that they can sustain the war for several more months and gain the upper hand in negotiations through military pressure. So far, however, the escalation has produced no tangible results. Rather, it is creating a more dangerous situation in which the war could spill over into new territories and draw in new actors and domains.
A Stalled Battlefield
The dynamics across the line of contact have not seriously shifted over the past several months. Russian armed forces continue to inch forward but with little to suggest that Moscow will achieve its military goals anytime soon. Russia’s main objective remains the capture of the entire Donbas region, which still requires seizing some of the most heavily fortified settlements in Donetsk oblast. Even though Russian forward-deployed groups are, by various estimates, 5 to 15 kilometres from Kramatorsk and Sloviansk, Ukrainian defence lines there appear to be holding, and the scattered villages, together with natural obstacles such as rivers and hills, will only make it more difficult.
The Russian Ministry of Defence’s announcement of full control over Kostiantynivka (Konstantinovka), an important stronghold in the Donetsk oblast that has seen fierce fighting for more than ten months, has been contested by Ukraine. The same appears to be true for some other locations, which, despite Russian advances and Ukrainian counterattacks, remain largely in a grey zone that neither side has managed to bring under firm control.
The nature of warfare has also changed dramatically. Various types of drones dominate the so-called ‘kill zones’, making massive assaults not viable, and most forward movement is now carried out by small tactical groups. Even when such units succeed in advancing and planting their flag, the effect is not always lasting—they are quickly targeted with drones and forced to retreat.
Meanwhile, Ukraine has upped the cost of war for the Kremlin with spectacular strikes deep into Russian territory on refineries, warehouses, and military infrastructure. Russia has responded in kind. If anything, this tit-for-tat escalation is only blurring the lines between civilian and military targets.
This is not entirely new in the current conflict, as many major industrial sites, particularly military production facilities and dual-use infrastructure, have already been targeted. Russia had long been the more active party, owing to its capability to strike Ukrainian regions far from the frontline. This situation is now shifting.
An Economy Under Strain
In late June 2026, Kyiv launched a 40-day operation aimed at “pressuring Russia to end its war.” First, Ukraine has acquired mid-range strike drones, which have enabled it to hit supply chains into Crimea, effectively isolating the peninsula and exacerbating the food and energy situation there.
Second, Ukraine has made progress in developing drones capable of striking facilities deep inside Russian territory, as well as establishing stable satellite navigation access. This is evident in sustained attacks on energy infrastructure, particularly oil refineries. The longest-range strike of this campaign hit a refinery in the city of Omsk, almost 2,500 kilometres from the Russia-Ukraine border. Kyiv has also launched a series of attacks on warehouses belonging to Russia’s largest online retailers across several Russian regions and has disrupted the passage of oil tankers, grain-carrying bulk carriers and container ships travelling to and from Black Sea ports. This has impacted Russia’s exports of crude oil and grain, compelling it to rearrange supply chains.
The results of Kyiv’s operation have been mixed. It has definitely posed serious challenges to Russia’s wartime economy: sustained strikes on refineries have triggered a fuel crisis across the country, with refining capacity falling and Moscow being forced to import petrol and diesel from abroad. The growing number of drone strikes, and their ability to reach distant regions, have brought the war home to many ordinary Russians, with recent surveys showing that anxiety levels have risen markedly compared to earlier years of the conflict.
However, the 40-day operation has done little to change the situation on the ground. It has done economic damage to Russia but has not shaken Moscow’s resolve to end the war on its own terms. It has also provoked Russia into intensifying attacks on Ukrainian logistics.
In recent weeks, for instance, Russia has stepped up strikes against Ukrainian ports, grain terminals on the Black Sea and commercial vessels heading to them—dealing a heavy blow to Ukrainian agricultural exports, one of the country’s few remaining sources of income. Russia has also destroyed nearly 250 petrol stations across various Ukrainian regions, particularly in the frontline-adjacent areas of the Kharkiv, Dnipro and Zaporizhzhia oblasts. Finally, capitalising on the Ukrainian shortage of interceptors for Patriot air defence systems, Russian forces have escalated strikes on the greater Kyiv area, home to many military and industrial facilities.
If the current trend of escalation continues without new agreements, Russia and Ukraine may be facing a brutal winter, in which economic strain inevitably spills over into a humanitarian crisis.
A Possible Endgame
Although the outlook for peace remains bleak, with previous attempts to craft a peace framework failing, the broader contours of how the war will end are discernible. For one, this will be a ceasefire along the line of contact rather than any land swaps presumably envisaged by the US-Russia discussions in Anchorage last year. It is a different matter that Russia may gain more territory by the time an agreement is signed. Second, Ukraine will likely become one of the most militarised countries in Europe, closely tied to Western security arrangements, albeit without formal NATO membership.
Despite neither side achieving its objectives, both could claim a form of victory: Kyiv for preserving its sovereignty, independence, and potential to further integrate into the European space; Moscow for creating a buffer zone on its borders and preventing Western military deployment on Ukrainian soil. The latter, however, would hinge on security guarantees offered to Ukraine, likely to be a point of hard negotiation.
Beyond Ukraine, Russia and European nations will also need to coordinate a new framework for coexistence—one that cools mutual hostility and brings more pragmatism to the relationship. Without a solid agreement on the future of European security architecture—itself likely to be the subject of protracted negotiations that may ultimately fail—the relationship will remain fraught with the risk of a new conflict flaring up.
Additional factors that will keep any peace deal fragile include domestic developments in both Ukraine and Russia, two countries that will suffer a post-war hangover. The loss of territory will bedevil Ukraine’s domestic politics for years to come, fuelling a sense of revanchism among constituencies pushing to regain lost lands. An economically weakened Russia, having expended vast resources in the war, would also seek clear mutual guarantees or deterrence mechanisms from the West. Beyond long-term economic issues, the country is likely to face deep social challenges in reintegrating all the demobilised soldiers back into society—something the Soviet Union grappled with in the late 1980s following the war in Afghanistan. Additionally, the social contract—a relatively high standard of living in exchange for reduced political freedoms—will come under further pressure in post-war Russia.
Although the Russia-Ukraine war is at an obvious deadlock, the conditions for the endgame have not yet ripened. For the diplomatic path to prevail, both sides must come to feel that continuing the war—wasting lives and economic and military resources—serves no strategic or political purpose. Kyiv and Moscow clearly are not there yet: both still hope to turn the tide of war in their favour.
Whether this ‘escalate to de-escalate’ approach can force a peaceful solution remains to be seen. One thing is clear: the Russia-Ukraine war will end in an armistice or a peace agreement rather than a total victory for either side.
About the authors:
- Nandan Unnikrishnan is a Distinguished Fellow at the Observer Research Foundation.
- Aleksei Zakharov is a Fellow, Russia & Eurasia, with the Strategic Studies Programme at the Observer Research Foundation.
Source: This article was published at the Observer Research Foundation.
