It has gradually dawned on the Russian leadership that the legislation approved by the US Congress amounts not just to some more tightening of sanctions, but to the downgrading of Russia’s status on the international arena to that of a “pariah state” on par with Iran and North Korea. Until recently, Russian diplomacy had been making a big fuss around the denied access to two vast estates in New York and Maryland, and President Vladimir Putin made a point of raising it at the meetings with US President Donald Trump during the G20 summit in Hamburg, Germany. The closure of a small US diplomatic dacha in Moscow announced last Friday was a rather weak counter to that measure enforced by the Obama administration last December, and it was certainly nowhere close to being an answer to the new devastating punishment (Svoboda.org, July 28). Putin is visibly angry about this “cynical” exploitation by the United States of its “geopolitical advantages” and perhaps also about his own miscalculations of Trump’s intentions in advancing cooperation with Russia, so a much more forceful response is to be expected—besides the dramatic reduction of the US embassy staff in Moscow (Moscow Echo, July 28).

There is no way for him to respond in kind, because Russia cannot afford any further deterioration of the investment climate. The only area that is exempt from US sanctions is cooperation in space programs, but Russian corporations are desperately dependent on its continuation (Kommersant, July 27). Propositions for dumping US obligations from Russian financial reserves would hardly make any impact on the strength of US currency, but could damage Russia’s financial system (Russian Council, July 27). The new US policy targets particularly the export of Russian corruption and the activities of oligarchs profitably connected with the Kremlin, and Moscow has no defense against such investigations (Navalny.com, July 28). The attempts to play on disagreements between the United States and the European Union could yield some dividends, but the conclusion about the hopelessness for Russia of confrontation in the economic sphere is beyond doubt (Gazeta.ru, July 26).

This means that foreign policy is going to be the main instrument for getting even with the United States, and Putin indeed considers himself a master of conflict manipulation (DW.com, July 26). One of the most dangerous crises develops in North Korea, but China has control over it, so the Russian defense ministry merely confirms that the missile tests pose no threat (RBC.ru, July 28). China is presently involved in a very tense standoff with India, but Moscow has no capacity for mediating in this test of ambitions (Nezavisimaya Gazeta, July 25). There may be some opportunities to influence the course of the civil war in Libya, but Russia has no capacity for a military intervention (Vzglyad, July 6). Violent unrest in Venezuela offers a chance for Putin to assert his stance against revolutions, but Caracas is too far out of his reach (Kommersant, July 28). Russia may make a demonstrative exit from the INF Treaty (1998), but the consequences could be extremely detrimental to its strategic interests (Profil, July 12). Russia has a position of power in the Arctic but it is difficult to find a way to extracting any political dividends from its military strength.

This leaves just two seats of violent conflict where Russia could move pro-actively against US and Western interests: Syria and Ukraine. The ceasefire in the southwestern corner of Syria negotiated by Trump and Putin in Hamburg is still holding despite not answering the interests of either the al-Assad regime, Iran or Israel (RBC.ru, July 24). Putin met last week with Iraqi Vice-President Nouri al-Maliki, who is a key conduit of Iranian influence, and sought to find new opportunities for Russian maneuvering (Gazeta.ru, July 25). He is, however, reluctant to be seen as Iran’s ally since that might endanger the deal on oil production cuts with Saudi Arabia and OPEC, which, as his ministers argue, is crucial for supporting the oil price on the level of $50 per barrel (Kremlin.ru, July 28). Syria is also the only place where military cooperation with the United States is still working, so undercutting it might be counterproductive (Nezavisimaya Gazeta, July 28).

As for Ukraine, Kurt Volker, the newly appointed US special envoy, was able to see clashes in the Donbas war zone last week, while Putin was blunt and irreconcilable in the telephone conversation with German Chancellor Angela Merkel, French President Emmanuel Macron and Ukrainian President Petro Poroshenko (Kommersant, July 25). Three Russian divisions are ready to move into this theater and break through Ukrainian defenses around Mariupol or in the outskirts of Donetsk (RBC.ru, July 23). Large-scale Russian-Belorussian exercises, Zapad-2017, planned for September might be used as a camouflage for deploying more forces that could turn a tactical success into a strategic breakthrough (Nezavisimaya Gazeta, July 25).

Last Sunday, the largest ever naval parade was staged in St. Petersburg, featuring the largest nuclear submarine Dmitry Donskoy, which for the last 15 years has been used as a test platform (Rossiiskaya Gazeta, July 22). Chinese ships also arrived for this show after joint exercises with the Russian Baltic Fleet (Fontanka.ru, July 26). Putin basked in the role of Commander-in-Chief and reaffirmed Russia’s status as a great naval power. On the eve of this demonstration of might, which extended to Tartus, Syria, Putin signed a decree on the guidelines of naval policy, which prescribes the concentration of efforts on the task of ensuring for the Russian Navy the position of the second most capable in the world (Ezednevny Zhurnal, July 25).

Quite possibly, this celebration of Russia’s naval capabilities, which are in fact seriously over-stretched and shrinking, has helped Putin regain confidence after the fiasco with cultivating special ties with Trump. It is doubtful, nevertheless, whether Putin can move into the already belated election campaign with this failure on his hands and nothing to show for the humiliating sanctions except for costly and profitless entanglements. Residual pragmatism dictates to him the need to suppress the urge to hit back on the arrogant adversary, who refuses him due respect and treats him like a maverick and corrupt dictator. He is, however, so obviously full of himself that suppressing vindictiveness goes against the character of an almighty ruler, who is entitled to domestic adoration and external admiration.