Outgoing US Secretary of Defense Lloyd Austin stated that while Russia has a certain upper hand in the war in Ukraine, it does not completely dominate the battlefield.

Speaking to Bloomberg on Jan. 8, ahead of a Ukraine contact group meeting at the US Ramstein base in Germany, Austin said Russia is still facing a growing number of challenges on the front line and beyond – and that sanctions are also making a difference.

“It [Russia] has some advantages, but it doesn’t completely dominate this equation here,” Austin said in an interview with Bloomberg News. “And if it gets what it wants, it will cost them in the future.”

Austin said it’s important to consider this aspect in any potential ceasefire negotiations that could be undertaken by the incoming administration of US President-elect Donald Trump.

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Trump has expressed a desire to quickly end the war in Ukraine. His advisers have hinted that any deal might allow Russian President Vladimir Putin to retain control of nearly 20% of Ukrainian land currently occupied by Russian forces.

Meanwhile, Ukrainian President Volodymyr Zelensky has recently shown a more flexible approach, suggesting that his government might rely on diplomacy to reclaim its territory as Russian forces continue to make steady advances.

Speaking of the challenges Russia is facing, Austin mentioned Kremlin’s reliance on North Korea and Iran for weapons, ammunition, and personnel. On the other hand, he said that Ukraine continues to strengthen its own military capabilities – even as Western assistance is still extremely crucial.

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The defense chief warned that holding large swathes of Ukrainian territory would require significant resources from Russia even after a ceasefire.

“Russia will need substantial ground forces to maintain control of occupied areas,” he said.

Responding to criticism from some European and Ukrainian officials about the Biden administration’s strategy, Austin defended the US approach, stating it had been instrumental in Ukraine’s survival and defense of its sovereignty.

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He said that Russia has suffered significant losses, with 700,000 troops killed or wounded—an outcome he described as “unthinkable” three years ago.

Austin is set to leave his position as Secretary of Defense when Trump takes office on Jan.20.

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