Russian forces ‘completely cut off’ from Kupiansk, says Ukrainian commander

Ukrainian forces say they have encircled Russian troops in Kupiansk and liberated northern districts, countering Moscow’s earlier claims of control, while heavy fighting continues in Pokrovsk and Myrnohrad with Ukraine reporting control of roughly 13 sq km in northern Pokrovsk and 54 sq km west of the city. Analysts warn Moscow’s push to seize Donetsk’s fortified “fortress belt” would likely take two to three years of costly combat; Russia’s reported territorial gains have been modest (about 4,168 sq km in 2024 and 4,669 sq km so far this year) amid estimated casualties of roughly 820,000. Compounding operational limits, Russian officials cite a 2.3m worker shortage and signs of economic strain and cash shortages that are prompting defence cuts, while the EU moved to indefinitely freeze €210bn of immobilised Russian assets—factors that increase the risk Moscow cannot sustain a large-scale offensive and that favor a protracted attrition scenario with material implications for defence supply chains and macro risk pricing.

Analysis

Ukrainian commanders report Russian forces in Kupiansk are "completely cut off" and say northern districts have been liberated, countering earlier Russian claims that the town was seized on November 21 and Vladimir Putin’s November 4 statement that Kupiansk was "practically" in Russian hands. President Zelenskyy’s visit and on-the-ground claims by Ihor Obolienskyi and Chief of Staff Oleksandr Syrskii underscore Kyiv’s narrative of tactical gains and information warfare surrounding frontline maps and control claims.

Heavy fighting continues in Donetsk-region towns: Ukraine says it controls almost 13 sq km in northern Pokrovsk and 54 sq km west of the city, while ISW and Ukrainian sources describe tactical retreats and counterattacks in Pokrovsk and resistance in Myrnohrad. Geolocated footage of drone strikes confirms ongoing frontline engagement despite Russian assertions of full control.

Strategically, ISW assesses that seizing Donetsk’s "fortress belt" would take two-to-three years and be costly; Russia’s reported territorial gains were modest (4,168 sq km in 2024 and 4,669 sq km so far this year) amid an estimated 820,000 casualties. Compounding operational limits, Russian officials cite a 2.3m worker shortage, a slowing 2025 economy and liquidity strains at the treasury, central bank and energy companies leading to cuts in defence spending, while the EU froze €210bn of immobilised Russian assets.

Market signals are moderately positive for Ukraine (sentiment score 0.35, market impact 0.52) but imply continued geopolitical and commodity volatility; investors should treat developments as indicators of a protracted, attritional conflict with periodic tactical reversals rather than a decisive near-term resolution.

Key Decisions for Investors

• Increase exposure to Western defense and logistics suppliers with transparent contract pipelines tied to NATO/European support programs, while monitoring official contract awards and EU funding decisions
• Reduce or avoid direct exposure to Russian financial and corporate assets given the EU’s indefinite freeze of €210bn in immobilised assets and reported Russian liquidity and labour shortages
• Use battlefield-verifiable indicators (geolocated footage, ISW territorial and casualty updates, commander statements) as triggers to re-evaluate risk exposure and sizing, and tighten hedges if Russian operational momentum appears to accelerate
• Maintain liquidity and option-based hedges ahead of major political or sanctions announcements, as continued attritional fighting and sanction moves are likely to drive episodic market and commodity volatility