Russia reportedly abandons its ruble-only plan in Kherson as Ukraine's military continues to make gains

Kherson Oblast, Ukraine.

Photo by Metin Aktas/Anadolu Agency via Getty Images

• Occupation authorities in Kherson announced a dual-currency system that allows use of the ruble and hryvnia, the Institute for the Study of War said.
• The Kremlin previously ordered the transition to rubles starting May 1, when the region was fully under Russian control. 
• But Ukraine's military has taken back large swaths of southern and northeastern territory in recent months.

Russia is abandoning a plan that would enforce a ruble-only payment system in occupied Kherson, according to the Institute for the Study of War. 

"Occupation authorities in Kherson Oblast announced a dual currency system that allows the use of both rubles and hryvnya, unwinding a months-long effort to enforce rubleization in the oblast," the think tank tweeted on Sunday, referring to the broader administrative region that includes the city of Kherson.

The move marks another setback for Russia's war on Ukraine. The city of Kherson was the first major Ukrainian city and only regional capital that came under Russian control in the early stages of the war.

The Kremlin's state-run media said earlier this year that Kherson would use rubles for transactions starting May 1. A four-month transition period was planned, during which the Ukrainian hryvnia would continue to circulate.

But just as those four months were expiring, Ukrainian military launched a daring counter-offensive that has resulted in Russia withdrawing from large swaths of territory in northeastern and southern Ukraine. 

Late last month, Russian President Vladimir Putin illegally declared the annexation of Kherson and other Ukrainian areas still under partial occupation, meaning Moscow now considers them part of Russian territory.

Meanwhile, Russian forces are still defending Kherson and officials said Monday the movement of civilians out of the city is complete, potentially in support of plans to blow up the Kakhovka dam to cover their withdrawal, according to the ISW. 

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