Russia is under real economic pain from Ukrainian drone strikes and is weighing a bigger response, which is bad news for Ukraine, energy prices, and global food supplies.

• Ukrainian drones have knocked out a large share of Russia's oil refineries and hit huge warehouses, wiping out billions in goods.
• Hardliners around Putin are openly discussing tactical nuclear weapons, though bigger conventional missile strikes on Kyiv are the likelier next step.
• CIA director John Ratcliffe flew to Moscow to warn against any attack on NATO — the last such trip came right before the 2022 invasion.
• Ukraine has run out of missile interceptors, partly because US stockpiles were drained by the war with Iran and defending Israel.
• Peace talks broke down over Russia demanding land it never managed to capture, and Xi has reportedly told Putin not to go nuclear.

Outlook: Expect heavier Russian strikes on Ukrainian infrastructure, with knock-on effects on gas prices, inflation, and world grain supplies.