The Financial Times reported around 20,000 people gathering in downtown Kyiv. This is much lower than seen during the peak of the 2004 Orange Revolution, but nonetheless significant. Indeed, most commentators have been surprised by the scale of demonstrations this time around. The routine now seems to be for demonstrators to mass at 9 a.m. around the Cabinet of Ministers, and again at 6 p.m. in the evening at the EuroMaidan.

Over the past 24 hours there were a number of notable developments:

First there was the statement from the EU, signed by Jose Manuel Barroso and Herman van Rompuy, to the effect that the door to Europe was still open to Ukraine, and that Ukraine should not be subject to undue pressure from third parties, a none-too-veiled reference to Russian President Vladimir Putin. The EU also noted demonstrations over the past few days and indicated that this showed that Ukrainians appreciated their European perspective, and should be supported in this.

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Second, there were several clashes between police and demonstrators last night, first around the Cabinet of Ministers and later in EuroMaidan. The latter seems to have been spurred when opposition activists discovered a police listening van within their ranks, and this sparked a scuffle to take control of the vehicle. The complete absence of violence was a distinctive feature of the first Orange Revolution in 2004.

This time around, a heavy police presence, with riot police bused in from outside of Kyiv, and the participation perhaps of the nationalist Svoboda organization, seems to be sporadically ratcheting up tensions on the ground. The government will presumably will need to carefully manage the demonstrations to prevent things getting out of hand – perceptions of excessive police force could easily multiply the scale of the demonstrations.

Third, jailed opposition leader, Yulia Tymoshenko, announced she was going on a hunger strike in the runup to the Vilnius summit. Her daughter, Eugenia, meanwhile, made a direct appeal to the German Chancellor Angela Merkel to ensure Tymoshenko’s release.

Fourth,Yanukovych affirmed his presence at the Vilnius summit on Thursday, but again indicated that he will not be signing the political and trade agreement, but appealed for calm. He indicated that economic necessity had forced him to make a very difficult decision to delay signing the deal with the EU and appealed for understanding from the population.

Nevertheless, it still seems strange in my mind why Yanukovych would still want to attend the Vilnius summit if he has no intention of signing the pac, and also why the Ukrainian government decided to pull out of negotiations with the Europeans pre-Vilnius and without getting a deal signed and sealed with Russia.

One interpretation of the above is that Yanukovych is still living in hope that the Europeans will offer more concessions come Thursday, particularly in terms of cash/financing. And that no deal has in fact yet been done with Moscow. 

Arguably ongoing demonstrations in Kyiv might help Yanukovych out in any future negotiations in Vilnius, Lithuania, as it could pull on the heart strings of EU leaders, as ordinary Ukrainians show a real desire to campaign and demonstrate for a European perspective, and especially in the face of perceived Russian aggression. In many respects, it is somewhat ironic that while within the EU, so many Europeans are unhappy with the union, there are still people outside who are desperate and eager to join the EU. Arguably, Yanukovych could turn his political career around now by pulling a deal with the EU out of the fire, and then standing up against Russia to defend Ukrainian sovereignty.

Perhaps the reason that Yanukovych opted to pull the deal with the EU a week before
Vilnius, is again to ensure that he had a fallback position with the Russians should he ultimately fail in the negotiations over the association agreement and free trade pact. The nightmare scenario for Yanukovych would have been to fail at Vilnius and then be forced to negotiate with Russia, from a position of extreme weakness, and likely with the economy and markets in meltdown. At least in the current scenario a deal has presumably been “penciled” in with Russia, as a worst-case scenario with an option still of a last minute deal with the EU.

I guess it is fair to ask whether Yanukovych could even now go back on any deal agreed with Putin and Russia – the wrath of Putin in such a scenario would likely be extreme. The deal from the Europeans would need to be very good, or demonstrations back home in Kiev so huge as to entice a change of tack.

This probably favours the alternative view that the deal with Russia has in fact been done, and Yanukovych’s trip to Vilnius is all about trying to go through the motions/buy time and perhaps take the heat of of street demonstrations, and any political backlash domestically  in Kiev. They are trying to gauge the likely level of street opposition, but their assumption still is that these peter out over time, and Russian cash/cheap gas still offers Yanukovych the best chance of securing re-election in 2015.

The above said I certainly still would not rule out a last minute deal at Vilnius – having covered Ukraine for close to 20 years now, what I have perhaps learned is that no scenario can be ruled out, as anything is possible in Ukraine.

Timothy Ash is head of emergency market research at London-based Standard Bank.