The war in the Middle East could decide the fate of Ukraine’s fight against Russia. Ukrainian President Volodymyr Zelensky says that Israeli “strikes have led to a sharp rise in oil prices,” which is a negative factor. According to him, “the Russians are strengthening due to higher revenues from oil exports,” UNIAN reports. 

“If there are price caps, the price will be limited, so probably the risks will decrease. Although someone will circumvent even that. That is, you cannot completely avoid the risks,” the president explains.

He claims that Ukraine will increase proposals to the American side for the introduction of price caps and sanctions against Russia’s energy sector.

“I will soon be in contact with the American side, probably with the president, and we will raise this issue,” Zelenskyy states.

At the same time, he draws attention to the military aspect.

“If we say that Iran is an ally of the Russians in supplying weapons, then have serious strikes been inflicted on the production of Shaheds and rockets, and other capabilities? We hope that it will decrease,” he says. 

Furthermore, he notes that the escalation in the Middle East leads to increased aid to Israel from the US.

“No one challenges the relationship between America and Israel, but we would like the aid to Ukraine not to decrease because of this,” the Ukrainian president stressed and recalled that previous tensions “slowed down aid to Ukraine.”

Earlier, expert Abbas Galliamov said that the Kremlin is losing one of its key bargaining chips in negotiations with Donald Trump amid Israel’s strikes on Iran. Up to 13 June, there was a kind of trade-off: “Ukraine in exchange for Iran.”

According to him, Trump would offer Putin not to put too much pressure on him over Ukraine for now, but in return, he counted on the Russian president’s support in negotiations with Tehran on its nuclear program. 

The United States is blocking European efforts to cut the G7 price cap on Russian oil from $60 to $45 per barrel, frustrating EU and UK attempts to ramp up pressure on Moscow’s war financing, Bloomberg reports.

The EU and UK could consider lowering the cap without the US, according to one of Bloomberg’s sources. The US, however, is not shifting its stance on the oil cap despite calls from the European Union and the UK to lower the limit. The proposal, aimed at reducing Russian oil revenues used to sustain its war against Ukraine, faces US resistance just ahead of the Group of Seven summit in Canada.

Trump again blames both Ukraine and Russia for failing to reach a peace deal

People familiar with the matter told Bloomberg that the final decision on any change rests with President Donald Trump. However, those sources said there has been no indication of flexibility from Washington since the US position was set during a G7 finance ministers’ meeting earlier this year.

Europe’s proposal forms part of latest sanctions package

The push to reduce the cap to $45 per barrel is part of the EU’s new sanctions package against Russia. The measure is intended to limit Russia’s capacity to fund its ongoing invasion of Ukraine by cutting deeper into its oil profits.

Given that most Russian oil shipments pass near European waters, unilateral European action could still have some impact. However, officials acknowledge that a coordinated G7 effort involving the US would be significantly more effective, largely because of US enforcement capabilities.

Oil prices, which had fallen below the $60 G7 ceiling, surged following Israeli strikes on Iran. 

Israel’s attack on Iran may have revived Moscow’s oil revenues for war

The current $60 per barrel cap was originally introduced by the G-7 as part of broader sanctions designed to curb Russian revenue while maintaining global supply. Enforcement of this cap relies heavily on G7 members, especially the US, which has extensive influence over global shipping and insurance mechanisms.

The world holds its breath after an Israeli strike on Iran, but Kyiv braces for worse as Washington’s priorities may shift, Radio Free Europe/Radio Liberty reports. 

Global reaction has been mixed, ranging from calls for restraint to avoid a regional war to open support for Israel’s decisive action. But for Ukraine, this escalation spells troubling consequences.

Analysts warn that the rising tensions between Israel and Iran could prompt the United States to divert its attention and resources from the war in Ukraine to the Middle East. This would be a deeply dangerous shift for Kyiv, which depends on uninterrupted allied support to resist Russian aggression.

“Without a doubt, this will distract some attention from the defense of Ukraine against Russian aggression,” said Roland Freudenstein, a Brussels-based analyst.

The Trump administration has been clear about its intent to bring the war in Ukraine to a swift close, even at the cost of painful compromises. A new crisis in the Persian Gulf only reinforces this narrative. Meanwhile, Trump’s self-imposed “two-week” window for striking a deal with Russia has just expired.

Beyond geopolitics, energy markets are also feeling the impact. Following Israel’s strikes, oil prices surged to $75 per barrel, a $5 spike in just hours. That’s direct profit for the Kremlin’s war chest.

“If the Middle East crisis deepens, it will inevitably push energy prices up. And in some ways, this benefits Russia,” warns analyst Ian Lesser.

While considering a price cap of $45 per barrel on Russian oil, the European Union risks losing leverage. Kyiv is demanding even tougher measures, a $30 cap, to strangle the Kremlin’s war financing. But in the current chaos, this plan may become harder to implement.

Once again, Ukraine stands to become a victim in a war, this time between Israel and Iran.

Russia could reach the borders of Romania, a NATO member, and attack other countries if Europe fails to help defend Moldova. On 11 June, at the Ukraine–Southeastern Europe summit, Ukrainian President Volodymyr Zelenskyy said that after targeting Moldova, Moscow plans to occupy the Ukrainian port city of Odesa, UNIAN reports. 

According to Zelenskyy, Southeastern Europe and Ukraine are among Russia’s targets for provoking chaos in Europe. Moscow has already stirred unrest in the Balkans, attempted to manipulate public opinion in Romania, and has kept Moldova in poverty and instability for three decades in an effort to bring it under its control, he said. 

“If Europe loses Moldova this year, it will encourage Russia to interfere even more in your countries, seizing your resources, your sovereignty, and even your history,” Zelenskyy warned.

The Ukrainian leader stressed that Russia does not see Ukraine as a sovereign state, but rather as a heap of resources and a military platform for future invasions.

Putin’s Victory Day speech may reveal his next target in Ukraine

Regardless of what Putin believes, Zelenskyy said, European countries must put Russia in a position where the aggressor is forced to seek peace. He emphasized that this is entirely possible and depends on Ukraine’s defense capabilities.

“Air defense systems and drones are crucial. Another key tool is sanctions,” he claimed.

Zelenskyy explained that Ukraine needs stronger support, especially regarding Russian oil tankers and the aggressor’s financial sector.

“About the oil price cap: $45 per barrel is better than $60—that’s obvious, that’s true. But real peace will come with a cap of $30 per barrel,” he emphasized.

He also urged European countries to treat postwar security guarantees as a matter of practical necessity.

Today, there is interesting news from the Middle East.

Here, OPEC has made a decisive move to punish member states violating production quotas by ramping up output and pushing oil prices to new lows. As the global markets react, the shockwaves hit Russia the hardest, with its economy, already strangled by sanctions and inflation, now gasping for air under the weight of collapsing revenues and shrinking influence within the oil cartel.

OPEC+ raises output, sending oil prices tumbling

Recently, OPEC+ announced plans for a significant increase in oil production for July, adding 411,000 barrels per day. This is the third consecutive monthly hike, and the move aims to regain market share, and discipline overproducing members like Russia, Iraq, and Kazakhstan. Despite the risk of oversupply, the group, led by Saudi Arabia, is prioritizing volume over price to reassert its influence in the global oil market, building on its previous decision not to increase prices.

The immediate effect of this decision has been a notable decline in oil prices. Brent Crude, sourced from the North Sea, has fallen to approximately 65 dollars per barrel, while the West Texas Intermediate produced in the United States is trading around 63 dollars, marking the lowest levels since early 2021. Analysts anticipate that this trend may continue, with forecasts suggesting that Brent Crude could hold the same reduced price for the entire year. Goldman Sachs projects that oil prices might average 60 dollars per barrel this year and potentially dip to 56 dollars in 2026. In more extreme scenarios, where global economic conditions worsen significantly, prices could even fall below 50 dollars per barrel.

Russian crude slides below budgeted threshold

For Russia, these developments pose significant challenges. As of early June 2025, the price of Russian Urals crude oil has fallen below 50 dollars per barrel, marking its lowest level since June 2023. Specifically, in April, Urals crude was priced at around 47.50 dollars. This is extremely below the 70-dollar benchmark used in the initial Russian budget planning for the year. It is estimated that each 10-dollar drop in oil prices costs Russia approximately 17 billion dollars annually. The resulting revenue gap of around 40 billion dollars is expected to widen the deficit to 10% of the projected Russian annual budget of approximately 415 billion dollars.

Gulf states challenge Russia in Asia

Moreover, Russia’s position in the Asian oil market is under threat. While Russia has been exporting discounted oil to countries like India and China, with the massive increase in production, other OPEC+ members are also targeting these markets, increasing competition and potentially driving prices even lower, while at the same time offering better quality oil compared to the Russians. This increased competition in Asia could erode Russia’s market share and further impact its oil revenues.

Russia’s influence within OPEC+ declines

Additionally, Russia’s influence within OPEC+ appears to be waning. The recent production increases have been driven primarily by Saudi Arabia, with Russia reportedly unhappy about these hikes. This shift suggests that Gulf states are increasingly dictating policy according to their own interests, potentially sidelining Russia in the decision-making process.

Sanctions, tariffs, and strikes cripple Moscow’s oil prospects

Russia is unlikely to benefit from increased production due to several factors. Tougher sanctions that get enforced more and more vigorously, price caps aimed to cripple the Russian oil revenue, and damaged refining capabilities, courtesy of Ukrainian precision strikes, limit Russia’s ability to capitalize on higher output. Furthermore, the production cost of Urals crude is higher compared to Brent Crude, as well as Brent having higher quality and being easier to refine into gasoline and diesel. There is also constant uncertainty about new sanctions coming soon, including a 500% secondary tariff being actively discussed in the US Senate, which would target countries buying oil and other natural resources from Russia. All this makes Russian oil less competitive in the global market and ruins all plans that have been made for the Russian budget, which is already under enough stress due to the ongoing war efforts in Ukraine.

In our regular frontline report, we pair up with the military blogger Reporting from Ukraine to keep you informed about what is happening on the battlefield in the Russo-Ukrainian war.