A huge plume of thick black smoke dominated the St Petersburg skyline on Wednesday after a Ukrainian drone attack, overshadowing the opening of Russia's flagship economic forum and puncturing the Kremlin's carefully stage-managed narrative of strength and stability. The attack – part of a sustained campaign of long-range strikes – is just one symptom of a war that is grinding into its fifth year, straining Russia's economy, exposing its defences, and even driving away old allies. Here's what is happening and why it matters.
At the St Petersburg International Economic Forum (SPIEF) in June 2026, President Vladimir Putin tried to project confidence. “There are wars and sanctions. But the economy is developing,” he told an applauding hall of entrepreneurs and foreign dignitaries. “Everything is stable.” Yet outside the congress hall, Ukrainian drones were hitting infrastructure in and around St Petersburg, with local officials admitting damage to “infrastructure” after a swarm of attacks. The abiding image of the forum, as BBC Russia editor Steve Rosenberg noted, was the column of smoke seen by all delegates arriving at the expo centre. Ukraine’s president Volodymyr Zelensky simultaneously published an open letter to Putin, proposing talks in a neutral country – a move Putin dismissed, telling his soldiers on the frontline: “Keep at it, brothers!”
“How Ukraine's drone war and lost allies are straining Putin's grip on Russia”
The drone strikes are not isolated. Days later, on 8 June, Ukraine launched a massive wave of attacks across Russia and occupied Crimea. Russia’s Defence Ministry said it shot down 310 Ukrainian drones overnight. Strikes hit the Grushovaya oil trans-shipment base near Novorossiysk – one of the largest such hubs in southern Russia – sparking a fire that required 130 firefighters to contain. A passenger train from Moscow to Simferopol in Crimea was also struck, killing the driver’s assistant and halting all passenger rail traffic in the peninsula. Ukraine’s General Staff said the attacks targeted fuel reserves supplying the Russian military, hitting facilities in the Krasnodar, Volgograd and Crimean regions.
These attacks come against a backdrop of deepening cracks in Russia’s international influence. At the same time as the SPIEF forum, Armenia – historically a close ally and part of Moscow’s “southern sphere of influence” – re-elected its pro-Western prime minister, Nikol Pashinyan, in a direct rebuff to the Kremlin. Since Russia’s full-scale invasion of Ukraine, the relationship has unravelled. In 2023, Russian peacekeepers in Nagorno-Karabakh stood aside as Azerbaijan retook the enclave, a move analysts say was intended to destabilise Pashinyan. Instead, Armenians directed their anger at Moscow, and Pashinyan won a decisive victory over the pro-Russia Strong Armenia bloc. He now argues Armenia’s future lies in escaping dependency on Russia and integrating with Europe.
For UK readers, these developments have real-world implications. The war in Ukraine is now in its fifth year, and Ukraine’s ability to strike deep inside Russia – including at oil infrastructure – affects global energy markets and supply chains. Russia remains a major energy exporter, and any disruption to its oil trans-shipment hubs can push up prices. Moreover, the erosion of Russian influence in former Soviet states like Armenia opens up new geopolitical alignments that could reshape security in Europe and the Caucasus.
Q: What is SPIEF and why does it matter? The St Petersburg International Economic Forum is Russia’s flagship annual business event, where the Kremlin showcases the economy and seeks foreign investment. Its being overshadowed by drone attacks is a powerful symbol of how the war is disrupting normal life and undermining Putin’s claims of stability.
Q: Why is Armenia’s election significant for Russia? Armenia has long been a key ally, hosting a Russian military base and depending on Moscow for security. The re-election of pro-Western PM Nikol Pashinyan – despite Kremlin pressure – shows that Russia is losing influence even in its traditional sphere. This could encourage other ex-Soviet states to drift West.
Q: Can Russia sustain the war given these economic and military pressures? Putin insists the economy is stable, but the drone attacks on oil infrastructure suggest Ukraine is targeting Russia’s ability to fund the war. The massive battlefield losses and the drone penetration deep inside Russia indicate the conflict is straining Russia’s resources. However, the Kremlin shows no sign of changing course, as seen in Putin’s dismissive response to Zelensky’s peace offer.
What happens next? The war shows no sign of ending. Ukraine continues to develop its long-range drone capabilities, hitting Russian oil depots and transport links. Russia responds with massive drone and missile barrages – on the same night Ukraine struck Russian facilities, Russia launched 155 drones at Ukraine. Meanwhile, Armenia’s pivot to the West may accelerate, with Pashinyan pushing to reopen borders with Azerbaijan and Turkey. For the UK and its allies, the key unknown is whether the combined pressure of battlefield losses, economic strain, and diplomatic isolation will eventually force a change in Putin’s strategy – or whether the conflict will grind on indefinitely.