Ukraine’s lawmakers approved chairman of the national gas company Naftogaz’s board, Serhii Koretskyi as the new Ukrainian Prime Minister on July 16 in anticipation of intense winter attacks by Russia.

Zelenskiy announced a surprise government reshuffle at the weekend, after asking Ukraine’s Prime Minister Yuliia Svyrydenko to resign. The Rada accepted her resignation on July 15 triggering the resignation of the entire cabinet. The parliamentarians are due to consider Zelenskiy's proposal for a replacement later this week.

The choice suggests a new pragmatic direction for the Zelenskiy administration ahead of real hardship once temperatures start to fall, as he appoints proven managers to important posts, rather than just loyalists to shore up his political power.

At the same time, the cull allows Zelenskiy to distance himself from his elite inner circle that have been tainted by an expanding series of corruption scandals. Indeed, the decision to shake the government up appears to have been triggered by a fresh scandal involving Ukraine’s ambassador to Washington that was about to break.

However, the shake-up has already produced one surprise after Zelenskiy said that the highly popular and effective Defence Minister Mykhailo Fedorov will not stay on in the new government and will be replaced by Interior Minister Ihor ‌Klymenko.

During the meeting with Ukraine’s Minister of Internal Affairs Ihor Klymenko at the weekend, the president discussed “pressing challenges that require a response from our state.” While speaking with him, Zelenskiy reportedly asked Klymenko to be ready to move to the defence portfolio, Ukrainska Pravda reported in what was taken as a sign that Zelenskiy was thinking about sidelining Fedorov.

The decision to sack Fedorov has sparked the second anti-government demonstrations since the war started, as citizens worry about the rampant corruption in the system. The first protests happened last year after Zelenskiy attempted to gut Ukraine’s anti-corruption reforms on July 22 organs with the controversial Law 21414.

The former tech entrepreneur has pushed through a raft of reforms and cracked down on rampant corruption in the ministry, but clashed with Ukraine’s Commander-in-Chief Oleksandr Syrskyi, a Soviet-trained career soldier. The combined weight of the defence establishment appears to have been pressured into dropping Fedorov after only six months on the job.

The decision is also likely to be extremely unpopular with Ukraine’s western allies, who are already concerned with the corruption problem. Ukraine was downgraded to a “B” by the EC during its annual reform progress assessment, as he was seen as the “new broom” in Zelenskiy’s cabinet that was finally dealing with the deep rooted problem of corruption.

Hands-on pragmatist

Koretskyi also has the reputation of being a hands-on pragmatist who has had few political ambitions. And with a major Russian winter bombardment looming, the appointment of an oil and gas man to the government’s top job is telling. The expanding missile war between Ukraine and Russia is all about energy. Kyiv has ramped up its long-range drone attacks on Russia that has caused an escalating fuel crisis in Russia, although as IntelliNews reports the refining sector is battered but not broken. Region after region are introducing ratioing or our right bans on sales after the production of petrol and other oil products in Russia has fallen by an estimated at least 13% y/y.

At the same time, Zelenskiy appears to be streamlining his government in preparation for a renewed missile barrage when the heating season starts in a few months. Russian President Vladimir Putin is widely expected to restart his efforts to freeze Ukraine into submission by targeting what is left of the power generation capacity. As IntelliNews reported, while Bankova has taken the war to Russia with its new medium- and long-range drones, Russia continues to have the overwhelming advantage in the drones vs missiles conflict.

Koretskyi is uniquely qualified to lead this effort, as Naftogaz is at the heart of Ukraine’s energy system and following years of reforms is now a well-run company and the biggest contributor to the budget.

“The transformation of state-owned companies, on which Ukraine’s resilience significantly depends, must be accelerated. Ukraine’s agreements with its partners on recovery also require separate and focused attention. Accordingly, personnel changes will begin in Ukraine to ensure the implementation of the updated political strategy,” Zelenskiy wrote on social media.

Koretskyi previously worked for a decade as a well-paid oil trader in the private sector making him less susceptible to corruption, before being appointed to run Ukrnafta for three years, the state-owned oil company. The state seized it from Zelenskiy-patron and oligarch Ihor Kolomoisky, who is now under arrest on fraud charges. Under Koretsky, Ukrnafta swung from losses to profits and became one of Ukraine’s most successful state-owned companies. He is seen as an energy professional, competent manager, with few political ambitions during his career, despite this week’s promotion to head the government. Koretsky was surprised by the offer but accepted it, Ukrainska Pravda reports.

“There are now new challenges due to Russian strikes, particularly against energy infrastructure in border and frontline regions, gas stations, and other facilities. Today, we discussed the steps our country needs to strengthen Ukraine’s resilience and deliver the expected results under our state’s updated political strategy,” Zelenskiy said on social media after meeting Koretskyi at the weekend.

The president met with Koretskyi, former prime minister and Energy Minister Denys Shmyhal, Defence Minister Mykhailo Fedorov, and Kharkiv Mayor Ihor Terekhov on July 12, the day the reshuffle was announced. The departure of the Prime Minister usually triggers a replacement of Cabinet members, but many of the current ministers are expected to retain their portfolios. Analysts have said the current government is one of the most competent in Ukraine’s independent history.

The president said that “each priority area of foreign policy will be assigned to a specific person with substantial experience,” because “Ukraine is changing its political strategy.”

Fedorov was among those Zelenskiy asked whether they would lead the government, according to Ukrainska Pravda but he declined, saying he had not yet had the chance to carry out his reform plans for the Defence Ministry.

Fedorov has won plaudits for initiating a series of reforms at the famously venal ministry, focusing on several critical areas, including strengthening anti-corruption measures, auditing existing expenditures, identifying systemic shortcomings and inefficiencies, reforming procurement processes, and establishing clearer strategic priorities.

Under his leadership, the Ministry of Defence significantly expanded procurement contracts for unmanned systems across virtually every category, while deliveries to frontline units increased exponentially.

He has also driven digital transformation, expanding the use of AI and modern digital technologies throughout the defence sector. Given Zelenskiy's reshuffle is as much about improving the efficiency of the armed forces in the campaign against Russia as it is consolidating his power, Fedorov is a strong candidate to remain in place based on his merits alone.

Svyrydenko's departure

Zelenskiy announced at the weekend that he had proposed to current Prime Minister Yulia Svyrydenko that she leave her post, which triggers the termination of jobs for all Cabinet ministers.

“I am grateful to Yulia for her clear, steady, and effective work as Prime Minister, for her years of productive service on Ukraine’s team, and I have offered her the opportunity to lead a new and important area of relations with a key partner. I expect that, together with MPs, we will make the corresponding changes in the Government of Ukraine,” Zelenskiy wrote.

Svyrydenko has only been in the job for a year and recently presented the country's new 15-year economic strategy to the Rada. Apparently she was not expecting to change jobs so quickly. According to sources at Ukrainska Pravda, the final trigger for the rapid government changes was an unexpected conversation the president had on Bankova Street last week, when Washington ambassador Olga Stefanishyna announced she was leaving her post for “personal reasons,” Ukrainska Pravda reports.

According to local reports, Stefanishyna quit after a corruption investigation was opened against her for a purchase of luxury property in Kyiv at “well below market prices,” Hromadske reports. Ukrainska Pravda also reports that the expanding corruption scandal surrounding the $100mn kickback Energoatom corruption scandal also played a role. In this context, Stefanishyna’s decision to quit was seen in Bankova not as a problem, but as an opportunity to remove the tainted elites and reset the cabinet’s deteriorating public image.

A second reason for the government's resignation is the president's office growing fatigue with the model of "government babysitting ," as Zelensky's team calls cooperation with the Cabinet, Ukrainska Pravda reports. Under the previous head of the president’s office, Andriy Yermak famously micromanaged every aspect of government and the prime minister coordinated almost every step with Bankova. Very close to both Zelenskiy and Yermak, Svyrydenko was an ideal figure. However, over time, this model began to irritate the president himself, and he decided on a reset and got rid of mere “yes-men” as the war presses on the administration.

“Operational management of the government should pass to the new prime minister, who will be expected not to endlessly coordinate decisions with Bankova, but to take his own initiatives, ready-made management decisions, and take personal responsibility for their implementation,” Ukrainska Pravda said in an analysis of the changeover.

Svyrydenko confirmed that she is leaving the post of prime minister of Ukraine but despite reports that she will be appointed to become ambassador to Washington, Ukrainska Pravda reports that she has refused this position. Svyrydenko is a Zelenskiy-loyalist and negotiated the 2023 minerals deal with the White House, with which she remains on very good terms. The move is also designed to capitalise on the recent dramatic warming of relations between the White House and Bankova following the meeting between Zelenskiy and US President Donald Trump at the Ankara Nato summit last week.

“I am grateful to the President for his trust and for his high assessment of our team’s work. I am proud to have had the honor of leading the Government during one of the most difficult periods in Ukraine’s modern history,” she wrote.

Energy Minister Shmyhal Former Prime Minister and now Energy Minister Denys Shmyhal is expected to keep his job too. While Shmyhal is highly competent and was the longest-serving prime minister since Ukraine’s independence, he is also busy trying to repair Ukraine’s battered energy sector and prepare for the coming winter.

“We discussed what now requires new and more decisive steps to protect our energy sector and strategic infrastructure facilities throughout Ukraine. The resilience plans of Ukraine’s regions and communities must be implemented to the same high standard everywhere, and any delays in any region pose a threat to people’s lives,” Zelenskiy said following the weekend’s meeting with Shmyhal.

Law enforcement agencies

At the weekend Zelenskiy said that changes may be made in the law enforcement agencies, sparking concerns that the president may attempt a second take-over of Ukraine’s anti-corruption bodies. Last summer, Zelenskiy rammed through Law 21414 that put the leading anti-corruption organs under his direct control, sparking the first anti-government protests since the war began. Zelenskiy quickly backed off and reversed the law.

Given the new pragmatic nature the new Zelenskiy administration seems to be taking on, reforms to the legal system may be connected to the ongoing reforms that are part of Ukraine’s EU accession bid. Last month, the EU formally opened negotiations on the various clusters, starting with the so-called Fundamental cluster that deals with judicial and anti-corruption reforms. Regional bosses In another sign that the shake-up is all about getting ready for the winter campaign and improving the efficiency of government, Zelenskiy met with a key regional boss, Kharkiv Mayor Terekhov, that is right on the frontline.

The president discussed “how interaction between the central, regional, and local authorities is organized, the key needs of our communities, and the prospects for implementing the decisions currently being prepared.” Zelenskiy said “resilience plans must be implemented as quickly as possible,” and that Kharkiv’s experience can be expanded to other cities and communities.