What could Russia win and lose in high-stakes standoff over Ukraine?

Russia has announced that some of its soldiers are now returning to base after completing military exercises near Ukraine, but it is too soon to know whether this marks the beginning of the end of the current security crisis in eastern Europe.

Moscow’s deployment of more than 100,000 troops and armour close to Ukraine has dominated recent news, but developments far from the tense border zone on Tuesday reflected other important aspects of relations between Russia, Ukraine and the West, and highlighted what the Kremlin hopes to gain – and could lose – in the current high-stakes standoff.

Donbas

Nothing important happens in Russia's parliament without Kremlin approval, so deputies' support on Tuesday for a resolution asking President Vladimir Putin to recognise the independence of two breakaway "people's republics" in Ukraine's eastern Donbas area clearly had top-level backing.

The regions were seized by Moscow-led militia in 2014, at the start of a war in Donbas that has now killed 14,000 people. The Kremlin has so far declined to absorb them into Russia or recognise their sovereignty, however, preferring instead to insist on Ukraine reintegrating them under the terms of framework peace deals known as the Minsk accords.

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Kyiv signed the deals while under immense Russian pressure on the battlefield, and their implementation in current form would potentially cement Moscow’s influence in Donbas and give it a blocking stake in Ukraine’s integration with the West.

The deputies’ appeal to Putin adds another element of tension and threat to talks on Donbas, but the Kremlin is unlikely to rush to recognise the regions’ independence now – such a move would destroy what is left of the moribund Minsk accords, which are for Moscow a useful weapon to wield against a Ukraine that would love to be rid of them.

By turning up the heat in Donbas, the Kremlin is increasing the danger of a flare-up that could be used to justify more Russian military intervention in the region, or may set the stage for the kind of “false-flag” operation that the US and Britain think Moscow may be planning.

Nord Stream 2

Is it coincidence that Moscow announced the return to base of some troops just as German chancellor Olaf Scholz arrived to discuss not only Ukraine but the fate of Nord Stream 2?

The US and EU say the gas pipeline will not enter service if Moscow attacks Ukraine again, potentially turning it into a €9.7 billion white elephant at the bottom of the Baltic Sea and perhaps placing doubts about Putin’s judgment in the minds of Russia’s tycoons.

As the security standoff has ground on, Europe’s fears of a midwinter crisis with its main energy supplier have receded, Russia’s stock markets and currency have suffered, and its major firms, business chiefs and officials have faced the prospect of “massive” new western sanctions. Has the Kremlin decided that its latest gambit is just too costly?

Geopolitics

Russia started the current crisis with two confrontational "big power" moves: the deployment of unprecedented military power near Ukraine and demands that Nato bar Ukraine from ever becoming a member and withdraw its forces from eastern Europe.

To Putin’s annoyance the West flatly rejected those demands, but now Russia says it is willing to discuss what it earlier dismissed as secondary issues, such as arms control and the conduct of military exercises in Europe.

Putin's allies point to visits from Scholz and French president Emmanuel Macron as proof that his approach has won Russia respect, and they mock the US and Britain for predicting all-out war and for moving diplomats out of Kyiv, claiming this shows how quickly the West is ready to abandon Ukraine.

Yet Kyiv is also experiencing a powerful new surge of diplomatic, financial and military support from western allies, and Russia’s military build-up has highlighted the value of Nato protection to many of its members and to some states that are not in the alliance; by probing for cracks in the West and its commitment to Ukraine, Putin may in fact have made them stronger – and reinforced Ukraine’s resolve to break free of its former ally.