Executive Summary

Russia’s Arctic ambitions have attracted increasing attention in the West over the past decade as climate change opens up new opportunities in the region for navigation and exploration of its riches. For its part, Moscow casts a wary eye on what it sees as a challenge from the United States and the North Atlantic Treaty Organization (NATO) to its position and ambitions there. The Kremlin’s rhetoric about Western encroachment has become more strident, in sync with its enhanced military posture and ambitious economic and infrastructure projects.

The Drivers of Russia’s Arctic Policy

Russian interest in the Arctic has deep historic roots that extend all the way to the sixteenth century and the conquest of Siberia driven by the never-ending quest for more resources and secure trading routes. Modern-day Russian posture in the Arctic is integral to its overall confrontation with the West, in which Europe is the principal theater. The saber-rattling in the Arctic and threatening rhetoric are driven by several factors: preparations for the unlikely, but potentially catastrophic contingency of war in Europe, the need to secure its second-strike nuclear capabilities (the bulk of which is based around the Kola Peninsula), and the quest for resources to pay for the proverbial guns and butter as the competition with the West shows no sign of abating. Great-power ambitions and the interests of powerful bureaucratic elites and business interests also play a role.

Ambitions vs. Reality

It remains to be seen whether Russia will be successful in realizing these ambitions. Its nuclear and conventional naval forces in northwest Russia are increasingly vulnerable to NATO’s long-range precision weapons. It is unclear whether the development of the Northern Sea Route (NSR) along Russia’s northern coastline into a major shipping route between Europe and Asia and the associated commercial projects are feasible and sustainable in the face of high costs and logistical complexity of operating in difficult climatic conditions with limited infrastructure, increased commercial competition from other countries, uncertain demand for hydrocarbons as the world shifts to green technologies, and the possibility of additional Western sanctions. The Kremlin’s posture in the Arctic is likely to continue as it enjoys backing from President Vladimir Putin and top military, government, and business actors. Its ability to achieve these broad ambitions for the region, however, is questionable at best.

Eugene Rumer
Rumer, a former national intelligence officer for Russia and Eurasia at the U.S. National Intelligence Council, is a senior fellow and the director of Carnegie’s Russia and Eurasia Program.
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Implications for the United States and NATO

Russia’s conception of its security requirements and NATO’s mutual-defense and deterrence commitments on the other hand have resulted in a tense standoff along the alliance’s northern flank as their forces operate in close proximity. Tempting as it may be to view the Arctic through the prism of great-power competition—which undoubtedly would fit with Russia’s quest for recognition as a great power—there is little to suggest that its military posture in the Arctic is a fundamentally new undertaking. Rather, it signals the return to a version of its Cold War–era posture centered around long-standing missions of protecting the sanctuaries of its ballistic missile submarine fleet and operations in the North Atlantic in the event of a war in Europe. Yet the Russian military is resuming these missions with fewer resources and facing a more formidable array of adversary capabilities than during the Cold War.

Russia has staked out ambitious territorial claims in the Arctic. Its rhetoric notwithstanding, it has thus far pursued them through legal means in compliance with the terms of the United Nations (UN) Convention on the Law of the Sea, which it has signed and ratified.

Russia’s actions in the Arctic—its aggressive rhetoric and its far-reaching territorial claims—have done little to improve its diplomatic position there vis-à-vis other Arctic states and only antagonized them. Its only partner in its Arctic pursuits has been China, which claims that it is a “near-Arctic” state—a claim rejected by the United States and likely viewed with suspicion by other Arctic nations.

Richard Sokolsky
Richard Sokolsky is a nonresident senior fellow in Carnegie’s Russia and Eurasia Program. His work focuses on U.S. policy toward Russia in the wake of the Ukraine crisis.

Considering the long-term nature of Russia’s confrontation with the West, the return to the relatively benign geopolitical environment in the Arctic that existed there in the 1990s is unlikely. Moreover, the current situation is not due to a misunderstanding, but rather to a clash of the two parties’ interests. That leaves two broad avenues for managing the standoff:

  • Diplomacy: Although Russia may not prove receptive, the United States and NATO should seek areas of cooperation where there is a convergence of interests, as well as to devise rules of the road similar to those that existed during the Cold War to reduce tensions, avoid or manage crises, and mitigate the risks of conflict through an accident or miscalculation.
  • Deterrence: The United States and NATO should continue to improve their defenses to discourage Russia from harassing their military and commercial aircraft and ships in and around the Arctic, and to ensure that the alliance maintains the capability to execute its wartime reinforcement plans for its northern and eastern flanks.

The alliance should continue to manage competition with Russia through a combination of resolve and restraint, improving and demonstrating its capabilities for defense and deterrence, but without overreacting to Russian muscle-flexing. Striking the right balance will be difficult and will require communicating to Russia clearly where the allies’ interests, objectives, and redlines are. The allies have been there before.

Introduction

During the first post–Cold War decade, Russia approached the Arctic as an area of low tensions, where cooperation with other powers in addressing common challenges was desirable and feasible.1 Gradually, however, as relations with the West deteriorated, and especially since its 2014 invasion of Ukraine, Russia has adopted a much more competitive, even confrontational, perspective on the Arctic. Instead of emphasizing the benefits of cooperative engagement, its leaders have articulated their view of the Arctic as a sphere of military and economic expansion, and an arena for their great-power ambitions.2 As a result of this changing attitude, Moscow has prioritized military superiority to counter what it claims is a growing U.S./NATO challenge to its interests there.

By any objective standard, U.S./NATO military deployments in the Arctic do not currently represent a threat to Russia’s Northern Fleet or to its other military assets there. The region possesses an abundance of natural resources, especially oil and gas, but these are available elsewhere in Russia. Exploring and extracting them in the Arctic requires huge capital investments and modern technology that would stretch its capacity. Global warming is opening up new commercial opportunities for shipping and fishing, but there is scant infrastructure in the region to capitalize on these opportunities, and rectifying this deficiency will be costly.

Paul Stronski
Paul Stronski is a senior fellow in Carnegie’s Russia and Eurasia Program, where his research focuses on the relationship between Russia and neighboring countries in Central Asia and the South Caucasus.
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Russia’s evolving Arctic ambitions have engendered growing concerns among other Arctic nations, yet surprisingly little is known about the basis for these ambitions. This paper therefore addresses the following questions: What are the drivers of Russia’s Arctic policy? How does it define its interests in the region and what tools does it employ to advance them? Who are the Russian stakeholders that would benefit from the exploitation of the region? What are the prospects for Russia realizing its ambitions? What are the implications of its actions and ambitions for U.S./NATO interests and policy?

For Russia, Arctic Strategy Is Integral to European Strategy

Since Vladimir Putin first became president, the Arctic has evolved into an increasingly important arena of Russian foreign, military, and economic policy. The Kremlin’s interest in the region became apparent soon after Russia emerged from its time of troubles in the 1990s and gradually resumed an active posture on the world stage in the early 2000s.

Long History, Multiple Drivers

Russian involvement in the Arctic dates back several hundred years. Much of this historical activity was supported and encouraged by successive governments and aimed at promoting trade and extracting natural resources. The discovery of oil and gas in Siberia—below and above the Arctic Circle—in the twentieth century offered wealth and hard currency, enabled domestic consumption, funded the Soviet military machine, and provided the economic foundation for the Soviet Union to pursue its foreign policy objectives.

The exploitation of Arctic riches accelerated in post-Soviet Russia. Oil and gas played the pivotal role in restoring the country’s economic fortunes in the early 2000s, underwriting domestic stability, fostering Putin’s rise as the country’s undisputed leader, and returning Russia to the world stage as an aspiring great power intent upon recouping its losses in Europe and reclaiming its rightful place in the international system.

The role of oil and gas in Russia’s Arctic ambitions was highlighted in 2006 as part of the Kremlin’s agenda to establish the country as an “energy superpower” and to justify its inclusion in the G8.3 Rising temperatures would make those riches more accessible and ensure the Kremlin a steady source of revenues as well as market and geopolitical influence in Europe and Asia. And without any contenders to challenge these ambitions, Russia had a shot at securing its place as a major geopolitical presence in the Arctic.

Even the high projected costs and technological difficulties associated with exploration and recovery of Arctic offshore resources did not appear to pose a major obstacle to the Kremlin’s ambitions. Projects would be open to participation by foreign energy companies with their technology and capital, and their participation would make them powerful stakeholders that could influence Western governments’ policy choices toward Russia. Moreover, thanks to the warming temperatures in the Arctic, the development of the NSR along Russia’s Arctic coastline would provide the Kremlin with an opportunity to diversify its energy policy by eventually linking the Russian Arctic to markets in Asia, thus reducing the country’s reliance on Europe as a critical energy market and on Ukraine as a critical conduit to that market.4

With oil and gas accounting for as much as 60 percent of Russia’s export revenues and upward of 30 percent of its federal budget, the motive behind its Arctic ambitions is not difficult to discern. The revenue from these projects would help sustain several critical priorities: further consolidation of Putin’s hold on political power as the leader who returned Russia from the abyss and restored it to greatness, the accumulation of funds to hedge against future economic or political adversity, and the rebuilding of the military, which had long suffered from neglect and was in need of modernization.

Reversal of Fortunes in Europe

Europe has always been the most important strategic theater for Russia. Its quest for security, great-power status, and recognition as an equal by other European countries has long been reflected in its preoccupation with strategic depth and a difficult relationship with major European powers. Immediately following the fall of the Soviet Union, Russia suffered major setbacks to these objectives and was relegated to the margins of the continent’s security, diplomacy, and geopolitics.5 The eastward expansion of NATO dealt a major blow to Russia’s historical ambitions and objectives in Europe, and especially to its quest for strategic depth as a measure of physical security of the homeland. NATO claimed responsibility for European security, and from Moscow’s perspective, other major European powers—historic adversaries—would have a voice and a veto at the NATO table while Russia would be left out in the cold.

By the end of the 2000s, Russian officials raised with increasing frequency concerns about the proximity of alliance forces to the Russian heartland and continued NATO expansion, despite the fact that most of NATO’s military capabilities had been redirected toward non-Russian threats. Moscow was particularly alarmed by the prospect of any future membership in the alliance by Georgia and Ukraine—something that the Kremlin saw as unacceptable and a threat to Russia.

However, it was Russia’s invasion of Ukraine in 2014 that led to a fundamental shift in NATO’s posture and Russia’s designation as the principal threat to the alliance’s security. These reactions by NATO to Russian aggression against Ukraine in turn magnified Russian perceptions of threat from the West. More recently, the unrest in Belarus has added to the Kremlin’s growing perception of vulnerability, raising doubts about Minsk’s reliability as an ally in the event of a large-scale conflict with NATO.6

Russia’s investments in Arctic energy projects are part of its broader strategy toward Europe and the wider world, but Europe is the most important arena in the Kremlin’s strategic calculations. The revenue from these investments helps sustain Russia’s defense capabilities needed for balancing against NATO, while Arctic navigation and maritime access to Asia will enable it to reduce its dependence on Europe, which it sees as hostile and increasingly intent on constraining Russia through a military buildup on its border and seemingly endless economic sanctions.7

Russian Military and Economic Interests in the Arctic

Russia has three key military interests in the Arctic. Foremost is securing the second-strike capability of its ballistic missile submarine (SSBN) force on the Kola Peninsula—home to seven of the Russian Navy’s eleven ballistic missile submarines—in a conflict with NATO.8 Concerns about the security of these assets largely account for Russia’s efforts to improve its anti-access/area-denial systems and monitoring and surveillance capabilities, the increasing tempo of strategic exercises and patrols of long-range bombers and anti-submarine warfare (ASW) aircraft, and the upgrading of military infrastructure to support these operations.9

A second, partly related, interest is protecting Russia’s ability to operate in the North Atlantic and the European Arctic in the event of a conflict with NATO. Unlike Russia’s other fleets, the Northern Fleet has direct access to the Barents and Norwegian Seas and the Atlantic Ocean. Its ability to operate there could be critical in determining the outcome of a conflict on NATO’s eastern flank.10

A third interest is military protection for Russia’s growing economic development, investments, and commercial interests in the Arctic. The vastness of the region, the long and open borders whose only protection is offered by remoteness and inhospitable climate, the poor communications systems and infrastructure, the overall harsh environmental conditions, and growing civilian activities there increase the risk of maritime shipping, nuclear, and environmental accidents—and thus the need to be able to rapidly deploy military-response capabilities.

Russia’s peacetime military presence in the Arctic and the allocation of resources to improve its military capabilities and infrastructure there are aligned with these interests. Maintaining a predominant military position in the Arctic is seen as a necessary component of Russia’s posture there, given the Kremlin’s priorities in Europe and tense relationship with the West, NATO’s enhanced military capabilities near the Russian border, and Western sanctions targeted to constrain Russian energy exploration and production activities in the Arctic.

Economics and Energy

Russia’s sparsely populated Arctic territories account for 10 percent of the country’s gross domestic product and roughly 20 percent of its exports. Hydrocarbons comprise the major share, but these also include nonferrous and precious metals, stones, and other raw materials.11 About one-third of all fish harvested in Russia comes from Arctic waters, making it a key food source. The Russian government hopes to increase that share by 2030, as warming ocean water pushes fish stocks northward.12

Tapping these resources is Russia’s primary economic interest, but doing so will require developing costly and complicated road, rail, aviation, and maritime transportation infrastructure to connect the Arctic to other parts of the country and beyond. It will also require expanding icebreaking capabilities and developing ports, weather stations, and emergency response facilities. Building this infrastructure is Moscow’s second economic priority in the region.

Finally, Russia aspires to transform its northern coast into the Northern Sea Route, a navigable maritime corridor through Arctic waters. Currently passable without icebreaker escort only in the summer months, the corridor is used mainly by Russian vessels to transport Arctic resources to markets in Asia. Russia’s 2020 Arctic strategy, however, envisions transforming it into a competitive Asia-Europe maritime corridor by 2035.13

Russia’s Tools

Russia has pursued its ambitions in the Arctic with legal, diplomatic, economic, military, and information tools that it has wielded with considerable skill and persistence.

The Law of the Sea

Russia is a signatory to the United Nations Convention on the Law of the Sea (UNCLOS), which the United States has never ratified. The Kremlin has based its claim to a large portion of the Arctic seabed as its exclusive economic zone under UNCLOS, arguing that the geology of its continental shelf is consistent with the terms of the convention.14 After its initial claim was rejected on technical grounds by the UN in 2001, Moscow submitted another in 2015.15 Its claim conflicts with similar ones submitted by Canada and Denmark, but if successful, it would grant Russia exclusive rights to exploit offshore resources in a vast portion of the Arctic Ocean. While it awaits the decision, Russia is negotiating bilaterally with Canada and Denmark on ways to reconcile their positions.

Regional Diplomacy

For regional diplomacy, Russia relies on the Arctic Council, which is the main international forum dealing with matters of governance and cooperation in the region.16 The council brings together the eight Arctic member states, organizations representing the region’s native peoples, and several observer states and organizations, including China. The Arctic Council’s 1996 founding Ottawa Declaration limits its mandate to issues of environmental protection, scientific research, and sustainable development.17 Military and security matters were purposely left out. Russia will take over the Arctic Council’s two-year chairmanship in May 2021 and has pledged to launch regional cooperation initiatives to reduce greenhouse-gas emissions, attract investment, and improve the condition of Indigenous People.18 Always eager to be seen as influential on the world stage, Russia will use its chairmanship to promote its soft power image on Arctic issues, even if concrete follow-through on environmental issues or Indigenous rights is lacking.

Russia also participates in the Arctic Five forum, which groups the Arctic littoral states—Canada, Denmark, Norway, Russia, and the United States—and does not include other international or nongovernmental actors.19 The Arctic Five meets on an ad hoc basis, often on the sidelines of other international gatherings. The Arctic Five generally serves as a discussion platform for maritime issues, including fisheries management and competing claims to the continental shelf. As an informal body, it is sufficiently flexible to deal with other issues as required.

Economics

Despite Russia’s limited resources and anemic economy, the Kremlin has committed nontrivial fiscal and monetary resources to support its ambitious agenda in the Arctic. The Russian government has offered tax incentives to large energy, mining, and infrastructure companies to invest in the region—especially in the eastern/Siberian Arctic territories, which to date have seen far less development than those Arctic regions west of the Urals.20

Some of these incentives are clearly intended for companies with close Kremlin connections. For example, in 2019 the government announced $41 billion in tax incentives over the next thirty years for Rosneft to develop the Vostok oil field, with the goal of eventually producing 2 million barrels a day.21 Potential Indian and Chinese investors in the project approached by Rosneft asked for similar incentives as a precondition for their participation, but reportedly have yet to agree terms.22

In 2020, the government approved an incentive program worth over $300 billion for Arctic infrastructure, industrial, liquefied natural gas (LNG), and oil and gas extraction projects.23 Other than oil and gas extraction, the petrochemical, mining, and timber industries will receive incentives to attract domestic and foreign investors.24 These incentives are intended to stimulate economic activity and the construction of towns, power plants, ports, and airports, as well as to stem the outmigration of population from the region.25

Hard Power

The Northern Fleet is Russia’s main military instrument in the Arctic. It is used to secure the SSBN force and Arctic borders; to assert great-power status; to support territorial and resource claims, economic interests, and infrastructure; and to counter and deter the buildup of military forces by NATO members and partners, and neutral countries, that the Kremlin considers threatening to Russian interests in the region.26

The importance attached to the Northern Fleet is reflected in organizational changes that have elevated its status. In 2014, Russia created an Arctic joint strategic command for the primary purpose of providing enhanced protection to existing and planned military installations along the NSR. As a critical component of this reorganization, a new Arctic brigade was created. In January, the Northern Fleet was formally designated as Russia’s fifth Military District—the first time that a fleet has been given equal stature with one of the land Military Districts.27

These important changes are the manifestation of the Kremlin’s 2017 announcement that the capabilities of the Northern Fleet were being upgraded to “phase NATO out of the Arctic.”28 The fleet’s capabilities are being modernized with the introduction of more capable naval surface combatants, missile and artillery units; four new brigade combat teams; a motorized infantry brigade; and more sophisticated air defense systems, anti-ship cruise missiles, and command, control, communications, computers, intelligence, surveillance, and reconnaissance systems.29 In addition, facilities are being constructed or upgraded to provide increased logistical support for these assets and a planned fleet of over fifty icebreakers.30

Based on the current pace and scope of this force modernization program, Russia does not appear to be on a trajectory to establish naval superiority in the region or a true blue-water navy. Most of its capabilities are not designed for offensive power projection but rather for close-in perimeter defense and protection of borders. Much of the growth in infrastructure is intended to conduct nonmilitary missions such as search and rescue operations or to protect maritime shipping and energy and economic investments.

However, many of Russia’s military capabilities and operations in the Arctic have inherent offensive potential and have been used in threatening ways.31 Its air and naval forces have intimidated NATO countries on the northern and eastern flanks of the alliance with provocative maneuvers; have increased naval, submarine, and air patrols near Danish and Norwegian territories; have conducted snap military drills in the region; and have used more aggressive tactics to harass U.S. naval and air operations off the coast of Alaska.32 Moreover, many Russian facilities being developed along the NSR are dual-use, and Russian measures to improve maritime security and safety, such as improved radar surveillance and communications or new drone bases, have inherent offensive potential.33

Russia’s primary operational focus is defense of the territory and seas surrounding the Kola Peninsula and denial of access to this region by U.S./NATO forces. But implementing an extended defense-in-depth for its SSBNs requires deployments through the Greenland-Iceland-UK gap, which would pose an increased threat to NATO’s sea lines of communication and carrier battle groups.34 Perhaps most importantly, Russia’s intentions could change if U.S./NATO actions—for example, the deployment of more advanced missile defense or ASW assets in or near the region—heighten its threat perceptions. Should this occur, Moscow will have additional incentives to shift from a defense-oriented strategy to a more offense-minded posture built on greater force-projection capabilities.

Information Operations

The Kremlin has launched an information campaign to highlight its accomplishments in the Arctic and promote its ambitions there. In 2007, an expedition planted Russia’s flag on the seabed at the North Pole as a symbol of its Arctic claims.35 Senior officials periodically hold high-profile photo opportunities in the region as they inspect military, energy, and scientific facilities.36 Senior officials and companies host high-profile international gatherings on the Arctic.37 One such event was held in 2016 on a Russian nuclear-powered icebreaker.38 Major companies—including Rosneft, Norilsk Nickel, and Gazprom—have co-sponsored the Arctic Territorial Dialogue/International Arctic Forum, which has convened periodically in St. Petersburg since 2010 and which Putin attends.39

The Stakeholders

The Arctic has ample supplies of oil and gas, making it a strategic region not only for the Russian economy but also the commercial interests of key Kremlin powerbrokers who are close associates and members of Putin’s inner circle.40 The Arctic economic interests of the state and of the ruling elites are intertwined.

The energy industry is the largest economic stakeholder in the Arctic. Energy companies, lacking capital and know-how to tap the region’s offshore resources, have turned to foreign partners. In 2011, the state oil company Rosneft—controlled by long-time Putin associate Igor Sechin—partnered with ExxonMobil, which has ample experience from developing Canada’s Arctic resources, to exploit those in the Kara Sea.41 The two companies agreed to invest $3.2 billion to share the risks and technologies to develop offshore reserves, and drilling started a year later.42 However, ExxonMobil was forced to abandon the project in 2014 when U.S. sanctions prohibited Western companies from working on Russian Arctic offshore oil projects. Rosneft resumed the project on its own in 2020 with Kremlin support.43

Novatek, Russia’s largest independent gas producer, in which another close Putin associate Gennady Timchenko is a major shareholder, has the controlling interest in the Yamal LNG plant. This is the country’s major high-profile project in the Arctic and an example of Russian-Chinese commercial cooperation there.44 After sanctions on Novatek limited Western financing and technology transfers to the project, the China National Petroleum Corporation and a Chinese state investment fund stepped in to fill the gap. Chinese entities now have roughly a 30 percent stake in the project while France’s Total owns a 20 percent stake in the plant.45 Novatek is building one more plant there with financing from China and is planning another in the Russian Far North.46

In 2018, Rosatom, the state nuclear power entity was designated as the manager of shipping along the NSR and given a key role in developing offshore Arctic infrastructure.47 In addition, it has been charged with building and overseeing the nuclear icebreaker fleet, managing emergency response in the Russian Arctic, and developing communication and navigation infrastructure along the route.48 Rosatom’s growing role in the Arctic has enhanced its political clout, increased its financing from the state budget, and spurred its diversification into transportation and logistics sectors.49

Finally, the defense and security sector and its leaders are among the key stakeholders in the Arctic. Security Council Secretary Nikolai Patrushev, a close Putin associate and former director of the Federal Security Service (FSB), is an outspoken advocate of expanding Russia’s presence in the Arctic and showcasing its exploits there to a global audience. In 2020, the Security Council established a special commission to promote Russian interests in the region.50 Former president Dmitri Medvedev chairs the commission, whose membership includes the ministers of defense and foreign affairs, senior representatives from the executive and legislative branches, and regional officials.51 Defense Minister Sergei Shoigu has long been an outspoken advocate of expanding Russia’s military’s presence in the Arctic as a hedge against threats to its interests from hostile neighbors.52

Prospects for Russian Success

Notwithstanding the ambitious plans of Russia’s government and corporations to attract foreign investors to realize their designs on Arctic riches, the prospects for success are far from certain. Oil and gas, which have been given the central role in those plans, are found in large quantities in other, more accessible and hospitable regions where they can be extracted and delivered to customers more economically. Russia’s track record of fulfilling ambitious programs, even those that are sponsored by Putin personally, is far from encouraging.53 Major corporations with close ties to the Kremlin, such as Rosatom or Rosneft, can extract significant subsidies from the government, but many projects lacking high-level political patronage remain unfunded and unrealized.54 Even in the Arctic, which enjoys a great deal of high-level attention and should be getting priority in resource allocations, major undertakings remain unfunded or underfunded.55

Several factors that are outside the control of the government further cloud the outlook for its Arctic plans. The impact of the COVID-19 pandemic on the global economy has depressed demand for oil and gas.56 Europe—the critical destination for Russian gas—has suffered a heavy blow to its economy and adopted ambitious plans for cutting greenhouse-gas emissions and reducing its carbon footprint. And, even without these factors, the European energy marketplace has become much more competitive for Russian producers as a result of major EU energy sector reforms.57

Russia’s ambition to expand its LNG exports to Asian markets, China in particular, also faces uncertain prospects. The combination of the high cost of LNG gas, the length and challenging conditions of the NSR, the risk of more U.S. sanctions, and the hard and unyielding position of Chinese negotiators are all significant challenges to overcome to turn this ambition into reality.58

The sheer size, emptiness, and conditions of Russia’s Arctic regions pose a daunting challenge to the goal of developing infrastructure, new settlements, and economic activity there. Built mostly with slave labor during the Stalin era, towns there suffer from high poverty and unemployment.59 The best and brightest are leaving.60 Keeping them there is likely to take more than just somewhat higher pay than what they can earn elsewhere. Furthermore, climate change and melting permafrost are having deleterious impacts on the ability to live and work in the region. Both have led to the loss or degradation of existing infrastructure, roads, and buildings, as well as a spate of industrial and transportation accidents.61

The NSR also faces an uncertain future as a major transportation link between Europe and Asia envisioned by Russian Arctic enthusiasts. Insurance for maritime operations in polar waters is expensive, as is ice-breaking support. In 2020, 331 ships traveled along a portion of the NSR, but only 62 made the entire voyage, carrying just 26 million tons—far below Moscow’s stated goal of shipping 80 million tons by 2024.62

Even Russia’s military posture in the Arctic faces an uncertain future. The mission of defending the northern border and the military and economic infrastructure in the region, as well as securing the SSBNs’ sanctuary, cannot be taken for granted in a hypothetical conflict with NATO. Plans for military modernization and new infrastructure are likely to contend with the same resource constraints and difficult operating conditions as the rest of Russia’s Arctic ambitions.63 At best, this will mean delays in their completion; at worst, they may prove too costly for the defense budget to sustain, especially if the oil and gas bonanza does not materialize.

Russia has already had to shelve its plan for creating a second Arctic Brigade for improved coastal defense.64 Moreover, the Northern Fleet faces major shortfalls in icebreakers and ice-capable ships, troop transport, aerial refueling, and ASW patrol aircraft.65 The fleet’s ability to conduct a broader range of missions and operations beyond bastion defense of its SSBNs will be severely hampered unless major investments are made to redress these shortfalls.

Russia’s ability to prevail in an Arctic conflict with NATO is an open question. The Baltic states are cut off from the rest of the alliance and, in a crisis, reinforcing them or deploying troops on their territory would be extremely challenging, involving a major operation that would be highly vulnerable to Russian interdiction. Moreover, their small size and proximity to major Russian military installations and garrisons would present Russia with undisputed advantages as would its superiority over NATO in icebreakers, ice-capable ships, local infrastructure, and cold-weather technologies and training.66

On the other hand, the geography of the Baltic region presents Russia with major vulnerabilities.67 The proximity of major Russian military installations to the Baltic states would leave them vulnerable to NATO’s longer-range precision weapons launched from air- and sea-based platforms. The Russian Navy’s ability to escape the confines of the Gulf of Finland in the event of hostilities would be in doubt.68 The heavily militarized Kaliningrad enclave, cut off from the rest of Russian territory, would also be vulnerable to NATO strikes.

Russia’s aggressive posturing in the Arctic and the Baltic regions has provoked NATO moves that in a crisis situation could backfire against it and severely threaten its security and interests. In February, the United States deployed an expeditionary B1-Lancer squadron with 200 personnel on a temporary basis to Norway.69 Last September, the U.S., British, and Norwegian navies conducted joint exercises just over 100 miles from the Russian coastline.70 And last March, Norwegian, British, U.S., and several other NATO units, as well as units from Sweden and Finland, conducted exercises simulating a “high-intensity combat scenario” in northern Norway.71

Implications for U.S./NATO Policy

Mutual accusations and warnings by NATO and Russia about the threat they pose to each other risk becoming a self-fulfilling prophecy. The situation is similar to the classic “security dilemma,” in which states take steps to increase their security, prompting other states to respond with their own security measures, thereby decreasing security for the first state.72 This is risky. The commitment of NATO members to each other and Russia’s vision of its security requirements, which emphasizes strategic depth and buffers to shield it from perceived threats to the homeland, meet toe-to-toe along the alliance’s northern flank.

An outright military conflict in the Arctic would not be confined to the region and would prove catastrophic for both sides. All the Arctic stakeholders have an obvious interest in avoiding such an outcome, as the result of either a deliberate or an unintended escalation. The latter is the more likely scenario and this risk is likely to increase as the opposing forces continue to operate in close proximity to each other.

However, neither side has shown willingness to back down. For NATO it is a matter of maintaining the credibility of its commitment to mutual defense; for Russia, its main adversary has advanced to the gates of the homeland and is intent on denying the security, geopolitical, and economic claims to which it feels entitled. The rising tensions are not the result of mutual misunderstandings—both sides’ actions are deliberate and reflect clashing interests.

Managing the Competition

It can be difficult to see past Russia’s rhetoric, deliberately provocative acts, and grandiose statements about its Arctic plans and threats to them, and to acknowledge that its bark so far has been worse than its bite. Russia’s ambitions far exceed the resources it has to realize them. Thus, while it is essential not to yield to Russia’s posturing, it is equally important not to overreact to it.

Notwithstanding the seeming novelty of the situation—changing climate, NATO’s new frontier in Eastern Europe, China’s growing footprint in the Arctic, and so on—Russia’s drive to the Far North and the rationale behind it are part of a long-standing historical pattern. Its confrontation with the West is not a new development either, and the push for Arctic resources is crucial for its ability to sustain this posture. From the perspective of the country’s security establishment, Russia is playing defense rather than offense.

Moreover, Russia is confronting the West in vastly diminished circumstances. Its economy is stagnant, its population is declining, and it is diplomatically isolated in Europe and among the Arctic states—almost entirely thanks to its own actions. It has rebuilt its military capabilities after a long period of neglect and decline, but even this utmost national priority is facing budget constraints and technological challenges. In the years to come Russia’s Arctic pursuits and posture will likely be driven by concerns about being able to sustain its already weakened position vis-à-vis the West.

Rather than treat the Arctic as the next arena of great-power competition with Russia, the United States and NATO’s other Arctic members should adopt a two-track strategy of diplomacy and deterrence.

Diplomacy

Although Russia may not prove receptive, the United States and NATO should explore multilateral arrangements to reduce tensions, avoid or manage crises, and mitigate the risks of conflict through an accident or miscalculation.

Currently, there is no venue for dialogue on security issues in the Arctic. One could be proposed to fill this gap—comprised initially of Russia, the United States, Canada, Denmark, and Norway—with a mandate to focus on crisis management, risk reduction, and conflict prevention, even if Russia’s continued unwillingness to engage seriously on these issues raise questions about its near-term viability.

Deterrence

The United States and NATO should implement defensive improvements to discourage Russia from harassing their military and commercial aircraft and ships in and around the Arctic, and to ensure that the alliance maintains the capability to execute its wartime reinforcement plans for its northern and eastern flanks. 73

The alliance should continue with its current posture of restraint and resolve to signal to Russia that it does not intend to engage in offensive operations, but fully prepared to defend its interests. Striking this balance will be difficult and will require clarity in communication to Russia the allies’ interests, objectives, and redlines.

Conclusion

In responding to Russia’s ambitions in the Arctic, it is important for the United States and NATO to base their plans on a realistic assessment of its posture there, its drivers, and its capabilities. Tempting as it may be to view the Arctic through the prism of great-power competition—which undoubtedly would fit with Russia’s quest for recognition as a great power—there is little to suggest that its military posture in the Arctic is a fundamentally new undertaking. Rather, it signals the return to a version of its Cold War–era posture centered around long-standing missions of protecting the sanctuaries of its ballistic missile submarine fleet and operations in the North Atlantic in the event of a war in Europe. The Russian military is resuming these missions with fewer resources and facing a more formidable array of adversary capabilities than during the Cold War.

Some hedging against a greater-than-anticipated Russian threat should be one element of the United States’ and NATO’s overall approach to the Arctic Region. But pursuing the goal of winning a great-power competition with Russia in this region is likely to be a distraction from other, more important U.S. pursuits. The alliance should act with prudence, realism, and restraint in protecting its core interests in the Arctic and carefully manage competition with Russia to avoid destabilizing consequences.

Even though their tense standoff is likely to continue, some cooperation between Russia and other Arctic nations, in practical areas that are largely depoliticized, is probably possible. These include climate change, search and rescue operations, and scientific research. Other opportunities for cooperation should be explored on issues of common concern, such as the safety of maritime shipping, environmental remediation, protection of fisheries, and incident management. In addition, it is essential for NATO allies to find potential diplomatic avenues for managing the standoff—that is, rules of the road to mitigate the risks of crises or incidents with the potential for escalation.74 No matter how unpromising they may seem, they should be explored. The allies have been here before.

Acknowledgments

The authors are grateful to Grace Kier, Amy Mellon, Tatyana Pyak, and Anna Switzer for their superb assistance in preparing this paper.

About the Carnegie Endowment for International Peace

The Carnegie Endowment for International Peace is a unique global network of policy research centers in Russia, China, Europe, the Middle East, India, and the United States. Our mission, dating back more than a century, is to advance peace through analysis and development of fresh policy ideas and direct engagement and collaboration with decisionmakers in government, business, and civil society. Working together, our centers bring the inestimable benefit of multiple national viewpoints to bilateral, regional, and global issues.

About the Russia Strategic Initiative

The Russia Strategic Initiative (RSI) is a U.S. Department of Defense organization that works with structures throughout the U.S. Government and with public and private think tanks around the world to develop a common understanding of Russian decision-making and way of war that supports the Coordinating Authority’s integration that leads to integrated planning, assessments, and action recommendations.

Notes

1 Mathieu Boulègue, “Russia’s Military Posture in the Arctic: Managing Hard Power in a ‘Low Tension’ Environment,” Chatham House, June 28, 2019, https://www.chathamhouse.org/2019/06/russias-military-posture-arctic.

2 Pavel Devyatkin, “Russia’s Arctic Strategy: Military and Security (Part II),” Arctic Institute, February 13, 2018, https://www.thearcticinstitute.org/russias-arctic-military-and-security-part-two/.

3 Angela Stent, “Restoration and Revolution in Putin’s Foreign Policy,” Europe-Asia Studies 60, no. 6 (August 2008): 1089–1106; “Byt’ li Rossii ‘energeticheskoy sverkhderzhavoy’?” [Will Russia be an ‘energy superpower’?], Izvestia, January 17, 2006, https://iz.ru/447741/byt-li-rossii-energeticheskoi-sverkhderzhavoi

4 Pavel Devyatkin, “Russia’s Arctic Strategy: Maritime Shipping (Part IV),” Arctic Institute, February 27, 2018, https://www.thearcticinstitute.org/russias-arctic-strategy-maritime-shipping-part-iv/; Guy Chazan, “Putin Uses Asia in Power Play on EU,” Wall Street Journal, April 27, 2006, https://www.wsj.com/articles/SB114607528829736665.

5 For more on this, see other recent Carnegie papers: https://carnegieendowment.org/2020/09/08/etched-in-stone-russian-strategic-culture-and-future-of-transatlantic-security-pub-82657; https://carnegieendowment.org/2019/02/20/russia-s-global-ambitions-in-perspective-pub-78067; and https://carnegieendowment.org/2019/06/05/primakov-not-gerasimov-doctrine-in-action-pub-79254.

6 Keir Giles, “Assessing Russia’s Reorganized and Rearmed Military,” Carnegie Endowment for International Peace, May 3, 2017, https://carnegieendowment.org/2017/05/03/assessing-russia-s-reorganized-and-rearmed-military-pub-69853.

7 “Rossiya perenapravit potoki gaza na Vostok pri problemakh na Zapade” [Russia will redirect gas flows to the East in case of problems in the West], Interfax, September 2, 2016, https://www.interfax.ru/russia/526358.

8 The Military Balance lists ten active SSBNs in the Russian Navy—six in the Northern Fleet and four in the Pacific Fleet. The eleven SSBNs referenced here reflects the four in the Pacific Fleet and the six active and one in reserve in the Northern Fleet. International Institute for Strategic Studies, “Chapter Five: Russia and Eurasia,” The Military Balance 120, no. 1 (2016): 166–219.

9 Rebecca Hersman, Eric Brewer, and Maxwell Simon, “Deep Dive Debrief: Strategic Stability and Competition in the Arctic,” Center for Strategic & International Studies, January 6, 2021, https://www.csis.org/analysis/deep-dive-debrief-strategic-stability-and-competition-arctic.

10 Christopher Woody, “Russian and NATO militaries are getting more active in the Arctic, but neither is sure about what the other is doing,” Business Insider, July 21, 2020, https://www.businessinsider.com/russia-nato-increasing-military-activity-in-the-arctic-2020-7; “NATO Is Facing Up to Russia in the Arctic Circle,” Economist, May 16, 2020, https://www.economist.com/europe/2020/05/14/nato-is-facing-up-to-russia-in-the-arctic-circle.

11 Andrew Higgins and Sergey Ponomarev, “The Lure of a Better Life, Amid Cold and Darkness,” New York Times, December 3, 2017, https://www.nytimes.com/interactive/2017/12/03/world/europe/norilsk-arctic.html; Duncan Depledge, “Russia and the Arctic: Crunch Call on Moscow’s Territory Claim Is Fast Approaching,” The Conversation, March 17, 2015, https://theconversation.com/russia-and-the-arctic-crunch-call-on-moscows-territory-claim-is-fast-approaching-38625.

12 Ivan Stupachenko, “Can Russia’s Arctic Deliver on Big Fishing Promises?,” SeafoodSource, April 4, 2018, https://www.seafoodsource.com/features/can-russias-arctic-deliver-on-big-fishing-promises.

13 “Ob osnovakh gosudarstvennoy politiki Rossiyskoy Federatsii v Arktike na period do 2035 goda” [On the foundations of the state policy of the Russian Federation in the Arctic for the period up to 2035], President of the Russian Federation, March 5, 2020, http://static.kremlin.ru/media/events/files/ru/f8ZpjhpAaQ0WB1zjywN04OgKiI1mAvaM.pdf.

14 Timo Koivurova, Juha Käpylä, and Harri Mikkola, “Continental Shelf Claims in the Arctic: Will Legal Procedure Survive the Growing Uncertainty?,” Finnish Institute of International Affairs, August 2015, https://www.fiia.fi/en/publication/continental-shelf-claims-in-the-arctic.

15 Andrew E. Kramer, “Russia Presents Revised Claim of Arctic Territory to the United Nations,” New York Times, February 9, 2016, https://www.nytimes.com/2016/02/10/world/europe/russia-to-present-revised-claim-of-arctic-territory-to-the-united-nations.html.

16 “Arctic Council,” Arctic Council, https://arctic-council.org/en/.

17 “Declaration on the Establishment of the Arctic Council,” Arctic Council, September 19, 1996, https://oaarchive.arctic-council.org/bitstream/handle/11374/85/EDOCS-1752-v2-ACMMCA00_Ottawa_1996_Founding_Declaration.PDF?sequence=5&isAllowed=y.

18 “Experts Speak About the Upcoming Program of Russia’s Arctic Council Chairmanship,” The Arctic, November 25, 2020, https://arctic.ru/international/20201125/988468.html.

19 Andreas Kuersten, “The Arctic Five Versus the Arctic Council,” Arctic Yearbook, 2016, https://arcticyearbook.com/arctic-yearbook/2016/2016-briefing-notes/205-the-arctic-five-versus-the-arctic-council.

20 John Last, “What Russia’s $300B Investment in Arctic Oil and Gas Means for Canada,” CBC, February 15, 2020, https://www.cbc.ca/news/canada/north/russian-arctic-oil-and-gas-explained-1.5462754.

21 “Russia Grants Trillion-Ruble Tax Cut for Arctic Oil and Gas Production,” Moscow Times, October 25, 2019, https://www.themoscowtimes.com/2019/10/25/tax-arctic-oil-gas-production-a67903.

22 “Foreign Investors Demand 2.6 Trillion Ruble Tax Cut for Rosneft — Vedomosti,” Moscow Times, October 10, 2019, https://www.themoscowtimes.com/2019/10/10/foreign-investors-demand-26-trillion-ruble-tax-cut-for-rosneft-vedomosti-a67673; Vladimir Afanasiev, “India to Set Up Working Group to Assess Entry Into Vostok Oil,” Upstream, February 5, 2020, https://www.upstreamonline.com/exploration/india-to-set-up-working-group-to-assess-entry-into-vostok-oil/2-1-751105; Vladimir Soldatkin, “UPDATE 2-Rosneft Holds Talks With Global Traders, India and China on Vostok Oil,” Reuters, February 12, 2021, https://www.reuters.com/article/rosneft-results/update-2-rosneft-holds-talks-with-global-traders-india-and-china-on-vostok-oil-project-idUSL1N2KI0KT.

23 Last, “What Russia’s $300B Investment in Arctic Oil and Gas Means for Canada”; “Russia Signs Plan for Tax Breaks on Arctic Oil and Gas Drilling,” Safety4Sea, March 11, 2020, https://safety4sea.com/russia-signs-plan-for-tax-breaks-on-arctic-oil-and-gas-drilling/.

24 Pavel Devyatkin, “Russian Government Supports Tax Breaks for Arctic Investments,” High North News, February 19, 2020, https://www.highnorthnews.com/en/russian-government-supports-tax-breaks-arctic-investments#:~:text=The%20Russian%20government%20has%20recently,for%20investment%20into%20Arctic%20projects.&text=The%20amendments%20support%20the%20provision,least%2010%20million%20rubles%20(approx.

25 Devyatkin, “Russian Government Supports Tax Breaks for Arctic Investments”; Last, “What Russia’s $300B Investment in Arctic Oil and Gas Means for Canada.”

26 “Ob osnovakh gosudarstvennoy politiki Rossiyskoy Federatsii v Arktike na period do 2035 goda” [On the foundations of the state policy of the Russian Federation in the Arctic for the period up to 2035].

27 Malte Humpert, “Russia Elevates Importance of Northern Fleet Upgrading it to Military District Status,” High North News, January 13, 2021, https://www.highnorthnews.com/en/russia-elevates-importance-northern-fleet-upgrading-it-military-district-status#:~:text=The%20Northern%20Fleet%20military%20district,additional%20bases%20across%20the%20district; Thomas Nilsen, “Putin heightens the strategic role of the Northern Fleet,” Barents Observer, June 8, 2020, https://thebarentsobserver.com/en/security/2020/06/putin-heightens-strategic-role-northern-fleet.

28 Daniel Brown, “Russia’s Northern Fleet Beefs Up Its Nuclear Capabilities to Phase ‘NATO out of Arctic’,” Business Insider, June 1, 2017, https://www.businessinsider.com/russias-northern-fleet-beefs-up-its-nuclear-capabilities-phase-nato-out-arctic-2017-6.

29 Andrew Radin, et al., The Future of the Russian Military Russia’s Ground Combat Capabilities and Implications for U.S.-Russia Competition (Santa Monica, CA: RAND Corporation, 2019); International Institute for Strategic Studies, “Chapter Five: Russia and Eurasia.”

30 Joseph Trevithick, “Russia’s New Icebreaker, The World’s Largest, Is Heading To The Arctic For The First Time,” The Drive, September 22, 2020, https://www.thedrive.com/the-war-zone/36637/russias-new-icebreaker-the-worlds-largest-is-heading-to-the-arctic-for-the-first-time.

31 Boulègue, “Russia’s Military Posture in the Arctic: Managing Hard Power in a ‘Low Tension’ Environment.”

32 Mike Baker, “‘Are We Getting Invaded?’ U.S. Boats Faced Russian Aggression Near Alaska,” New York Times, November 12, 2020, https://www.nytimes.com/2020/11/12/us/russia-military-alaska-arctic-fishing.html; Thomas Nilsen, “Russian Bombers Met by NATO Fighter Jets Over the Barents Sea,” Barents Observer, February 9, 2021, https://thebarentsobserver.com/en/kirkenes/2021/02/russian-bombers-met-nato-fighter-jets-over-barents-sea.

33 Nurlan Aliyev, “Russia’s Military Capabilities in the Arctic,” International Centre for Defence and Security (ICDS), June 25, 2019, https://icds.ee/en/russias-military-capabilities-in-the-arctic/; Matthew Melino and Heather A. Conley, “The Ice Curtain: Russia’s Arctic Military Presence,” Center for Strategic & International Studies, February 26, 2020, https://www.csis.org/features/ice-curtain-russias-arctic-military-presence.

34 Melino and Conley, “The Ice Curtain: Russia’s Arctic Military Presence.”

35 Tom Parfitt, “Russia Plants Flag on North Pole Seabed,” Guardian, August 2, 2007, https://www.theguardian.com/world/2007/aug/02/russia.arctic.

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37 Atle Staalesen, “Security Strongmen Take on Key Role in Russian Arctic Policy,” Independent Barents Observer, August 27, 2020, https://www.rcinet.ca/eye-on-the-arctic/2020/08/27/security-strongmen-take-on-key-role-in-russian-arctic-policy/#:~:text=Under%20the%20auspices%20of%20its%20Secretary%20Nikolay%20Patrushev,,observer%20states%20in%20the%20Karelian%20island%20of%20Valaam.

38 Atle Staalesen, “Welcome to Pevek. Russia Invites Arctic Council to Icebreaker Tour,” Barents Observer, June 22, 2016, https://thebarentsobserver.com/en/arctic/2016/06/welcome-pevek-russia-invites-arctic-council-icebreaker-tour.

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73 Hersman, Brewer, and Simon, “Deep Dive Debrief: Strategic Stability and Competition in the Arctic.”

74 Boulègue, “Russia’s Military Posture in the Arctic: Managing Hard Power in a ‘Low Tension’ Environment.”