Russia’s Putin Orders Military to Crush Wagner Power Grab, Calls It Treason
Wagner paramilitary group seizes southern city of Rostov, heads toward Moscow
From the Wall Street Journal:
The crisis unfolding in Russia represents the most serious challenge to Putin’s 23-year rule—a direct consequence of the strains put on Russian society and armed forces by the war that he unleashed against Ukraine in February last year.
Wagner troops, led by Yevgeny Prigozhin, earlier in the day took over the main military headquarters for southern Russia, in Rostov, and other installations there, encountering virtually no resistance from the regular armed forces. After that, Wagner sent columns of troops northward toward Moscow, as the Russian army rushed to cut off highways and defend the capital city. Moving past Voronezh, Wagner’s tanks and troop carriers were seen by Saturday lunchtime crossing the Lipetsk region, where authorities called on residents to remain indoors.
Whatever happens now, what we’re seeing is historic and it will have serious consequences for Putin,” said Abbas Gallyamov, a former speechwriter for Putin who is now a regime critic living outside Russia. “This feels like the initial phase of a revolution.”
In a televised speech Saturday morning, Putin—while not naming Prigozhin by name—described his moves as a “criminal adventure, a grave crime, an armed mutiny.” Wagner’s power grab, he added, is reminiscent of the 1917 revolution that destroyed the Russian Empire, “when the country was waging World War I but its victory was stolen,” leading to the loss of huge territories.
“We will not let this be repeated. We will defend our people and our state against all the threats, including internal treason. And what we are facing is precisely treason,” Putin said. “Any internal strife will be a mortal threat for our statehood, for us as a nation. Our actions to defend the motherland against this danger will be harsh.” The military and other security forces, he added, have already received appropriate orders, including to regain control over Rostov.
Videos posted online by local reporters and bystanders showed Wagner tanks and fighting vehicles easily bypassing barricades of buses and streaming into Rostov early Saturday morning. Wagner fighters wearing white armbands surrounded the cream-colored headquarters of Russia’s Southern Military District.
On Saturday morning, Russian officials started taking down Wagner recruitment banners in the nation’s cities.
In a statement Saturday, Russia’s Ministry of Defense called on Wagner fighters to reject calls to participate in what it described as an armed rebellion, saying they have been “tricked into Prigozhin’s criminal adventure.”
All evidence points to Russia being on the verge of an attempted coup by Wagner. The questions that remain are: 1) Who is backing Wagner? 2) Will the Russian military fight Wagner? 3) Is Putin still in control? 4) What is Prigozhin’s real goal? 5) How will this effect the war in Ukraine?
Market Reaction- On the one hand, any potential resolution to the war in Ukraine is bullish for markets. Conversely, chaos within a nuclear armed country and the potential for a new “hard-liner” Russian leader would not be bullish for world peace. Either way, look for increased market volatility depending on the current situation before market open on Monday.
Potential for big increases in oil, gold, wheat, and defense contractor stocks. If it looks like this will distract Russian from the Ukraine War, marker will rip higher.