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Ukraine Crisis – Russia / Ukraine Sanctions Update

Mayer Brown
30/06/2022

UPDATE:

June 29, 2022

  • Strong Ruble Could Hurt Russian Businesses: As the ruble strengthens to levels not seen in seven years, Russia’s Minister of Economic Development Maxim Reshetnikov warned that the country’s businesses could suffer if the trends persist. Reshetnikov was quoted saying, “If such a situation will last for several more months, I think many enterprises may come to the idea not only curtailing investment processes, but also of the need to adjust current production plans and reduce production volumes.” (https://www.ctvnews.ca/business/strong-ruble-could-hurt-russian-businesses-official-warns-1.5967750).

  • Ukrainian Railways Raises Tariffs for Freight Transportation: The Ministry of Infrastructure of Ukraine agreed with Ukrainian Railways’ proposal to increase its tariff on cargo transportation by 70 percent. Due to the tariff increase, the state railroad company plans to generate an additional UAH 11B of revenue by the end of 2022. The extra income will be able to cover some of the estimated costs of repairing war damage that exceed UAH 100B ($3.1B). (https://ubn.news/ukrainian-railways-raises-tariffs-for-freight-transportation-by-70/).

  • Russia Threatens Retaliation against Norway over Access to Arctic Islands: Russia stated that restrictions imposed by Norway were blocking goods for Russian-populated settlements on the Arctic archipelago of Svalbard, and threatened unspecified “retaliatory measures” unless Oslo resolves the issue. The Russian foreign ministry said that it had summoned Norway’s chargé d’affaires to protest against the restrictions, which it said have disrupted the delivery of critical supplies, including food and medical equipment. (https://www.reuters.com/world/europe/russia-threatens-retaliation-against-norway-over-access-arctic-islands-2022-06-29/).

  • Russia Ready to Export Tens of Millions of Tons of Grain: Russia is not preventing the export of grain from Ukraine and is ready to export tens of millions of tons of grain if the West stops blocking food supplies, according to Russian Foreign Ministry Spokeswoman Maria Zakharova. According to various estimates, 20 to 25 million tons of wheat were blocked from being exported in Ukraine. (https://tass.com/economy/1473173).

  • Anti-Russian Sanctions Spur Global Food Crisis, According to Russian Ambassador: Russian Ambassador to the US Anatoly Antonov stated, “As to the food security, it was the wave of anti-Russian restrictions, imposed by the US-led collective West, that spurred the global food crisis. Its root causes are incompetent macroeconomic steps taken by a number of developed nations, climate change and the COVID-19 pandemic.” (https://tass.com/economy/1472973).

  •  Russian-Backed Government to Hold Referendum in Southern Ukraine: A senior Russian-backed official installed to run the southern region of Kherson in Ukraine said the authorities there are preparing for a referendum to join the Russian Federation. Kirill Stremousov, deputy head of the military-civilian administration of the Kherson region, stated, “It [Kherson] will become a full-fledged entity that can be like one single state in which the peoples of Russia live like one family.” About 45 percent of the pre-invasion population has left the region, according to Ukrainian officials. (https://edition.cnn.com/europe/live-news/russia-ukraine-war-news-06-29-22/h_63f67c64cf24134b526e03df6106f28b).

  •  Ukrainian President Asks for Russia to be Removed as Permanent Member of UN Security Council: President Zelenskyy addressed the UN Security Council listing all the Russian attacks on Ukraine within the past week and noting that the UN does not yet have a definition for the term “terrorist state.” He finished this speech by asking the UNSC to expel Russia from the body, stating, “Russia does not have the right to remain in the UNSC.” (https://edition.cnn.com/europe/live-news/russia-ukraine-war-news-06-28-22/h_0532d63656eaab554e6cd95ce484e17e).

  • Ukrainian President Accepts Invitation to Attend G20 Summit: Ukrainian President Volodymyr Zelenskyy accepted his personal invitation to attend the G20 summit in Bali in November, while his Indonesian counterpart Joko Widodo was in Kyiv. Zelensky went to say that Widodo’s visit was important to help stop the war, stating, “I consider our talks today to be an important step for strengthening global anti-war coalition of all the countries that can bring back and guarantee stability to the world.” (https://www.cnn.com/europe/live-news/russia-ukraine-war-news-06-29-22/h_df2c62380fcb2117a8ff48df3e2e3ed7).

UPDATE:

June 28, 2022

  • Russian Industry Faces Crisis as IT Providers Pull Out: International sanctions and tensions over the war have forced industrial manufacturers to wind down operations in what was once one of their biggest markets. According to the Russian Steel Association, the steel industry alone has invested 3.2 trillion rubles ($59 billion) in the last two decades to rebuild capacity after its post-Soviet decline, with a majority spent on equipment supplied by foreign companies to increase the sector’s efficiency. Industrial and agricultural plants, businesses and government services are now potentially vulnerable to security breaches and viruses due to lack of replacement parts for software crashes. (https://finance.yahoo.com/news/russian-industry-faces-code-crisis-040000251.html).

  • Russia Fines United Parcel Service Over Data Storage: A Moscow court fined United Parcel Service (UPS) 1 million rubles ($18,900) for an alleged refusal to storage the data of Russian users on Russian territory, according to TASS news agency. UPS joined video streaming service Twitch, social network Pinterest, and holiday rental company Airbnb as the latest companies to be fined by Russia in their clash against Big Tech. (https://www.reuters.com/business/russia-fines-united-parcel-service-over-data-storage-tass-2022-06-28/).

  • Russian Duma Passes Bill Removing VAT on Digital Assets: On Tuesday, the Russian Duma passed a bill that would exempt digital asset sales from value added taxes in Russia. The bill also establishes income tax rates of 13 percent for Russian exchanges on the first 5 million rubles (currently about US$93,000) of their annual tax base, 15 percent on amounts above that limit and 15 percent across the board for foreign exchange operators; the current Russian company tax rate is 20 percent. The move is likely to attract digital asset exchanges and users as the country feels the impact of western sanctions. (https://cointelegraph.com/news/russian-duma-passes-bill-to-remove-vat-lower-income-tax-rates-on-digital-asset-sales).

UPDATE:

June 27, 2022

  • Russia Misses Key Bond Payment: Late Sunday night, Russia missed the deadline for an interest payment of an estimated $100 million dollars on its foreign currency sovereign debt. Bondholders still need to make a formal declaration of default, and Russia has preemptively declared any default declaration as “absolutely illegal.” (https://www.nytimes.com/live/2022/06/27/business/economy-news-inflation-stocks).

  • Zelenskyy Calls for Increased Sanctions in G7 Address: Speaking via video link to the G7 summit in Germany, Ukrainian President Volodymyr Zelenskyy called on the assembled world leaders to increase sanctions on Russia. His proposed limitations included a “forcible[] limit[] [on] the price of Russian oil exported,” designating Russia as a state sponsor of terrorism, and creating a global mechanism to seize and confiscate Russian assets. (https://www.president.gov.ua/en/news/volodimir-zelenskij-pid-chas-onlajn-uchasti-v-samiti-lideriv-76073).

  • Russia Plans To Hit Japan With Countermeasures: On Monday, in response to fresh Japanese sanctions, Russia promised to hit Japan with countermeasures. Sanctions are “short-sighted and harm Japan itself, especially the business community“, Ambassador Mikhail Galuzin said in a statement posted on the Russian embassy’s Facebook page. (https://www.channelnewsasia.com/world/russia-japan-sanctions-ukraine-invasion-2772961).

  • Putin To Participate in G20 Conference: Presidential Aide Yury Ushakov announced that Putin has accepted an invitation from Indonesia to participate in a summit meeting of the Group of 20. (https://tass.com/politics/1472071).

UPDATE:

June 24, 2022

  • Russia to Resume Art Exhibitions in “Friendly” Countries in 2023: On Friday, the Russian Culture Ministry announced that it would resume cooperation in art exhibitions with “friendly” countries beginning in 2023. The Ministry suspended the practice in March after the start of the conflict in Ukraine, and the Hermitage museum independently introduced a yearlong moratorium on exhibitions in the U.S. and Europe. (https://tass.com/society/1471097).

  • Russia Suspends Membership in the Finland-Russia Society: On Friday, the Russian Foreign Ministry announced that it had decided to terminate cooperation with the Finland-Russia Society, a Finnish NGO that promotes bilateral relations between the countries. The Ministry said that the decision was due to Finland’s “outspoken” opposition to Russia’s involvement in the conflict in Ukraine. (https://tass.com/society/1470819).

UPDATE:

June 17, 2022

  • Western Sanctions’ Impact of Russian Flights: On Friday, The New York Times published an interactive piece highlighting the impact of sanctions on flights predominately used by the Russian elite. The graphic demonstrates that Russian planes avoided EU airspace after the invasion of Ukraine, and increased flights to the Middle East and Central Asia. (https://www.nytimes.com/interactive/2022/06/17/world/europe/russia-private-jets.html).

UPDATE:

June 16, 2022

  • Russia Nearing Default Status: On Thursday, Bloomberg reported that holders of approximately $100 million in Russian debt have not yet received payment on their dollar and Euro-denominated debt. Russia has until June 26 to pay the debt; Finance Minister Anton Siluanov said at the St. Petersburg International Economic Forum that the Kremlin still intends to deliver dollar and euro payments to bondholders, though he did not elaborate on a timeline. (https://finance.yahoo.com/news/russia-struggling-100-million-debt-132637283.html).  

  • Russian Banks Struggling to Find Lawyers in US due to Sanctions: Bloomberg reported that Russian banks are struggling to find legal representation in the United States, as the banks struggle to find US financial institutions that will accept payment from Russia. As an example, a federal magistrate judge announced a stay in a pending case against VTB Bank until June 23, as VTB Bank negotiates with its counsel to find an acceptable payment program. (https://news.bloomberglaw.com/business-and-practice/vtb-bank-lawyers-cant-get-paid-because-of-russia-sanctions).

  • Sanctions Hinder Sovcomflot’s Ability to Pay Debt: Sovcomflot announced Thursday that its next payment on $498 million in debt has been “hindered” by EU and UK. Sovcomflot is pursuing a modification in payment terms that would allow it to meet its debt obligations. (https://tass.com/economy/1466203).

  • Sanctions Fail to Bring Russia to Negotiating Table: The Wall Street Journal reported on Thursday that allied sanctions on Russia have thus far failed to encourage negotiations to bring about a ceasefire in Ukraine. Analysts interviewed for the piece cited Russia’s current account surplus and high commodity prices as reasons why Russia has been able to maintain a somewhat stable economy despite the restrictions. In addition, Western governments are hesitant to impose sanctions on Russian energy products, which allows the Russian economy to persist, according to these analysts. (https://www.wsj.com/articles/sanctions-so-far-fail-to-dent-russias-war-effort-11655383912).

  • Russia Uses International North South Transport Corridor to Send Goods to India Despite Sanctions: Russia has begun sending goods to India via the International North South Transport Corridor (INSTC), a multimodal, cross-border freight network that links Russia to Central Asia, Iran and India, involving sea, rail and road links, to overcome sanctions-related challenges in doing business with traditional trade partners. (https://theloadstar.com/russia-uses-instc-corridor-to-beat-sanctions-and-drive-trade-with-iran-and-india/).

  • Central Bank Governor Confirms Russia Will Continue to Circulate Dollars and Euros: On the sidelines of the Saint Petersburg Economic Forum, Russian Central Bank Governor Elvira Nabiullina stated that Russia will continue to circulate dollars and Euros, though the Russian economy had been “pursuing the policy of de-dollarization… for many years.” (https://tass.com/economy/1465841).

  • Russia Announces Expanded Pickup of Mir Cards: At the Saint Petersburg Economic Forum, First Deputy Chairperson of the Bank of Russia Olga Skorobogatova stated that four more countries had agreed to adopt the Mir Card, a payment card issued by the Bank of Russia. She did not mention the countries; Turkey, Vietnam, Armenia, Uzbekistan, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan, South Ossetia and Abkhazia currently accept Mir Cards (https://tass.com/economy/1466295).

UPDATE:

June 15, 2022

  • Oil Production in Russia Grew in May Despite Sanctions: Despite an initial post-invasion reduction in production of crude oil and related liquids, in May, Russian output of crude oil and related liquids rose marginally, by about 130,000 barrels per day from April to 10.55 million barrels a day, according to the International Energy Agency. (https://www.nytimes.com/2022/06/15/business/russia-oil-sanctions.html).

  • Ukrainian Official Describes Russia as “More Resilient than Expected” with Regard to Sanctions: In an interview with Politico on Wednesday, Ukrainian Deputy Economy Minister Taras Kachka stated, “Russia seems to be more resilient to sanctions than we estimated at the beginning… Initially, there was an assumption that impacts [of] sanctions will be more and more visible.” He cited commodity sales as the reason for this resilience, and added that the West should use this as an opportunity to further restrict Russian oil and gas imports, as well as other commodities, like steel. (https://www.politico.eu/article/ukraine-says-russia-more-resilient-to-sanctions-than-expected/).  

UPDATE:

June 14, 2022

  • Russia Bans 29 British Journalists and 20 Defence Figures: On June 14, 2022, Russia’s foreign ministry announced that it was banning 29 journalists and members of British media organisations such as the BBC, Sky News, the Guardian and The Times from entering Russia. Another 20 British figures who Moscow said were linked to the defence industry were also banned from entering Russia.  (https://www.reuters.com/world/uk/russia-bans-29-british-journalists-entering-2022-06-14/).

  • Moscow Exchange Suspends Swiss Franc Trading After New Sanctions: The Moscow Exchange said Tuesday that it would suspend trading of the Swiss franc against the ruble and the U.S. Dollar after Switzerland adopted new EU sanctions against Russia. In a statement, the Exchange noted that, “The suspension of operations is due to difficulties conducting settlements in Swiss francs faced by market participants and the financial sector in connection with the restrictive measures imposed by Switzerland on June 10.” (https://www.reuters.com/markets/currencies/moscow-exchange-suspends-swiss-franc-trading-after-new-sanctions-2022-06-14/).

  • Russia Sanctions Leave Nord Stream Turbine Stranded Abroad: Supply chain disruptions brought on by Western sanctions on Russia have left equipment key for the functioning of the Nord Stream gas pipeline stuck abroad. The Siemens Energy AG turbine is unable to return to Germany from Canada, where it had been sent for maintenance. A second turbine also due for maintenance now cannot be sent overseas as well. The subsea Nord Stream gas link, with a nameplate capacity of 55 billion cubic meters per year, is the key route for Russian gas to Germany. Flows via the pipeline will be curbed from its maximum capacity due to the technical issues at the Baltic Portovaya compressor station, according to Gazprom. (https://www.bloomberg.com/news/articles/2022-06-14/russian-sanctions-leave-nord-stream-turbine-stranded-in-canada?srnd=premium).

  • Ukraine President Addresses Singapore Shangri-La Dialogue: At a gathering of 575 delegates from 40 countries in Singapore on Saturday, Ukrainian President Zelenskyy addressed attendees, identifying the importance of international law, and warning that “Today’s example of Ukraine is the example for the whole world,” in what has been interpreted as a nod towards China. Other attendees, like Japanese Prime Minister Kishida, noted that “Ukraine today may be East Asia tomorrow.”  (https://www.washingtonpost.com/world/2022/06/14/shangri-la-dialogue-asia-china-ukraine-zelensky-singapore-taiwan-japan/).

  • Sanctions Force Russian Automaker to Forgo Airbags: Avtovaz, producer of the popular Lada brand automobile in Russia, has resumed production of its vehicles after the Russian government slashed safety regulations in response to supply chain shortages caused by sanctions. The new version of the Lada Granta will no longer feature airbags, an anti-lock braking system, electronic stability control, or emergency retraction locks on seat belts. It also fails the emissions standards adopted by most of Russia’s neighbors. (https://www.nbcnews.com/news/world/sanctions-force-russia-produce-popular-car-safety-features-even-kremli-rcna32863).

UPDATE:

June 13, 2022

  • Sanctions Protect Exiled Russian Bankers: On Sunday, The Wall Street Journal profiled several Russian bankers in exile in countries that have imposed sanctions. The Russian government previously launched lawsuits against these bankers, who have fallen out of favor with current Russian political leaders, in their countries in order to claw back funds allegedly held illegally, but these cases have recently been thrown out, as the award in favor of the Russian government would violate sanctions regimes in these countries. (https://www.wsj.com/articles/russia-is-after-these-ex-bankers-assets-but-sanctions-could-bail-them-out-11654976143).

UPDATE:

June 11, 2022

  • Zelenskyy Calls for Seventh Sanctions Package: During European Commission President Ursula Von Der Leyen’s visit to Kyiv on Saturday, Ukrainian President Volodymyr Zelenskyy called on the Union to implement a seventh sanctions package. He stated that this package should include “companies that are helping the Russian state in one way or another – whether in the military sphere or in suppressing democracy” and added that the EU should “completely eliminate Russian energy resources.” (https://news.yahoo.com/zelenskyy-asks-eu-seventh-package-133254210.html).

  • Russian Central Bank Chief Discusses Default, Secondary Sanctions in Press Conference: Speaking to the press after the Russian Central Bank’s board meeting on Friday, Central Bank Chief Elvira Nabiullina stated that Russia was able to pay its debts, saying it has ample reserves to pay sovereign obligations but is experiencing “technical challenges” in repaying sovereign debt in foreign currency. On secondary sanctions, she said that the risk remained, adding, “[t]he majority of companies involved in the foreign economic activity experience problems at present: this is the difficulty in establishing ties with new suppliers, in making payments, searching for new sales markets and delivery of goods along new routes.” (https://tass.com/economy/1463679; https://tass.com/economy/1463623).

  • Russian Aviation Authority Extends Flight Suspensions to Areas Near Ukraine: The Russian Federal Air Transport Agency announced on Saturday that flights to Anapa, Belgorod, Bryansk, Voronezh, Gelendzhik, Krasnodar, Kursk, Lipetsk, Rostov-on-Don, Simferopol and Elista would continue to be suspended through June 18. Flights to these airports, which are located near the Russia-Ukraine border, were suspended due to the conflict. The Agency proposed alternate routes through Sochi, Volgograd, Mineralnye Vody, Stavropol and Moscow. (https://tass.com/economy/1463829).

  • McDonalds Restaurants Set to Reopen Under New Management, Marketing: On Sunday, several McDonalds restaurant locations in Moscow will reopen under new management and branding. Much of the food will remain the same, since McDonalds’ Russian supply chains have shifted to domestic sources in recent years, an indication of the Russian economy’s ability to rebound in response to western sanctions. (https://www.nytimes.com/2022/06/10/world/europe/russia-economy-mcdonalds.html).

  • Russian Auto Industry Struggles to Source Parts: The Guardian reported on Saturday that Russian citizens are having difficulty sourcing parts for car repairs, describing a secondary market with prices for parts marked up 10 times over typical prices and dealers with month-long waiting lists for new parts. Automakers like Avtovaz are having difficulty in sourcing parts for new cars, as well, with semiconductor shortages forcing Avtovaz to furlough workers. (https://www.theguardian.com/world/2022/jun/11/the-return-of-banditry-russian-car-industry-buckles-under-sanctions).  

  • President Putin Signs Legislation Rendering ECHR Opinions Void in Russia After Withdrawal: On Saturday, Russian President Vladimir Putin signed legislation voiding all European Court of Human Rights (“ECHR”) opinions against Russia after March 15, 2022, the date the country withdrew from the human rights body. Compensation payments due from ECHR opinions are valid, as long as they are made in rubles to accounts in Russian banks, through January 2023. (https://tass.com/russia/1463889).

  • Domestic Demand for Russian-Made Sparkling Wine Increases: On Friday, Pavel Titov, the President of the Black Sea wine company Abrau-Durso told Bloomberg that he was seeing increased demand for Russian sparkling wine, and that his stockpiles were selling out quickly. Though foreign sanctions typically exclude food products, voluntary withdrawals of wine suppliers are forcing Russians to turn to domestic stock. TASS estimates that, if trends continue, shortages of sparkling wine may hit Russia for the holidays. (https://www.bloomberg.com/news/articles/2022-06-10/sanctions-may-leave-russia-short-of-bubbly-for-new-year).

UPDATE:

June 9, 2022

  • Ukraine Sanctions Russian Officials: Ukrainian President Volodymyr Zelenskyy signed a decreed Thursday imposing personal sanctions on 35 Russian officials, including President Vladimir Putin, Putin’s spokesman Dmitry Peskov, Prime Minister Mikhail Mishustin, and a number of other high ranking officials. Those sanctioned individuals are prohibited from entry into Ukraine, have had their visas and permits revoked, as well as all issued licenses and permits. They also block financial assets. Zelenskyy signed an additional decree imposing sanctions on 236 Russian universities and their leaders. (https://www.yahoo.com/news/zelenskyy-imposed-sanctions-putin-peskov-151413463.html).

UPDATE:

June 8, 2022

  • Russian Microchip Maker Considers Leaving Taiwan: Defense News reported on Wednesday that Russian microchip manufacturer MCST, which produces the Elbrus microchip, stated that it may remove its production line from Taiwan to Russia. Relations between Russia and Taiwan have deteriorated since the start of the war in Ukraine, and Russian Deputy Trade Minister Vasili Shpak said that Taiwan has stopped shipping microchips to Russia. Shpak said that the move would help boost Russian domestic production of microchips, if completed. (https://www.defensenews.com/industry/2022/06/08/russian-microchip-maker-eyes-taiwan-exit-in-response-to-sanctions/).

  • Bloomberg Investigation Reveals Changed Russian Trading Landscape: Though the Russian government is slowing data releases of late, Bloomberg is reporting that, based on an analysis of Russia’s major trading partners indicates that trade with “much of Europe has dried up,” and China is starting to reduce shipments of merchandise. However, Belarus’s exports to Russia are surging; its reported value of imports to Russia surpasses Germany’s reported imports to Russia, according to the analysis. (https://finance.yahoo.com/news/russia-topsy-turvy-world-where-040000655.html).

UPDATE:

June 7, 2022

  • Russia Expands Oil Exports from Major Eastern Report to Offset EU Ban: With demand surging from Asian buyers, Russia is set to ramp up oil exports from the port of Kozmino by around one fifth. Russia is also planning on sending an extra 80,000 bpd of East Siberia Pacific Ocean (ESPO) Blend Crude to Kozmino via rail from Meget, allowing Kozmino to increase overall loadings to roughly 900,000 bpd in the months ahead (up from 750,000 bpd so far this year). ESPO oil exports via Kozmino are projected to reach 880,000 bpd in July. (https://www.reuters.com/markets/commodities/exclusive-russia-hikes-oil-exports-major-eastern-port-help-offset-eu-ban-2022-06-07/).

  • Russia’s Sovereign Eurobond Payments Stuck at Euroclear: Bloomberg reported Tuesday that Russia’s latest sovereign Eurobond payments have been transferred from Russia’s National Settlement Depository to Euroclear Bank SA, but the cash is being held there for compliance reasons. Recent moves by the U.S. and EU to heighten their sanctions regimes have made it significantly more difficult for Russia to pay its debts, increasing the odds of default significantly. (https://www.bloomberg.com/news/articles/2022-06-07/russia-s-latest-eurobond-coupons-are-stuck-at-euroclear).

UPDATE:

June 6, 2022

  • Russia Alleges Mistreatment of its Journalists in the US, Threatens Retaliation: Speaking to assembled press in Moscow on Monday, Russian Foreign Ministry Spokeswoman Maria Zakharova claimed that the US was mistreating Russian journalists, denying them visas and interrogating them on entry. She added, “[i]f the U.S. government doesn’t lift all measures against the Russian media or imposes further sanctions, then exactly the same will be applied to you.” State Department Spokesman Ned Price denied her claims. (https://www.wsj.com/articles/russia-says-u-s-mistreats-its-journalists-threatens-retaliation-11654550998).

UPDATE:

June 4, 2022

  • Putin Discusses Options for Grain Exports: In an interview with Rossiya 1 TV, Russian President Vladimir Putin discussed options to export grain from Ukraine. He suggested that Ukraine could clear its seaports of mines and export through controlled ports, such as Berdyansk and Mariupol. Putin added that overland transport out of Ukraine is also possible, saying Belarus was the “most logical option”, but Western sanctions would need to be lifted on the country for this to occur. He criticized “short-sighted” Western sanctions, and noted that river transport was an option for Ukrainian grain exports. (https://tass.com/economy/1460605).

  • Zelenskyy Urges US Mayors to Cut Ties with Russian Cities: In a speech to the US Conference of Mayors, Ukrainian President Volodymyr Zelenskyy urged local officials to cut off “brotherhood” ties with Russian cities. He highlighted Chicago’s tie with Moscow, Jacksonville’s tie with Murmask, San Diego’s tie with Vladivostok, and Albany’s tie with Tula, among others. He asked, “[w]hat do these connections give you? Probably nothing. But they give Russia the opportunity to say that it is not isolated, even after beginning such a war.” (https://www.president.gov.ua/en/news/ne-dopomagajte-rosiyi-vipravdovuvati-sebe-j-ne-dozvolyajte-v-75589).

  • Lavrov Says Oil Sanctions Will Not Impact State Coffers: In an interview with Bosnian television on Saturday, Russian Foreign Minister Sergei Lavrov stated that Russia has “suffered no budgetary loss” as a result of energy sanctions from other nations, and added that the country expects “to significantly increase the profits from the export of our energy resources.” He stated that “[o]il, generally speaking, is not subject to politics, there is a demand for it…we have alternative sales markets, where we are already increasing sales.” (https://www.newsweek.com/russia-claims-sanctions-wont-hurt-energy-profits-expects-increase-1712877).  

  • Medvedev Criticizes Sanctions on Oligarchs’ Families: In a message on his Telegram channel, Deputy Chairman of the Russian Security Council and former Russian President Dmitry Medvedev criticized Western decisions to sanction family members of oligarchs and government officials, claiming they “are in no way capable of influencing their relatives.” (https://tass.com/politics/1460677).

  • Ukrainian Foreign Minister Criticizes French Calls to Avoid “Humiliating” Russia:On Saturday, Ukrainian Foreign Minister Dmytro Kuleba tweeted, “calls to avoid humiliation of Russia can only humiliate France and every other country that would call for it. Because it is Russia that humiliates itself. We all better focus on how to put Russia in its place. This will bring peace and save lives.” French President Emmanuel Macron has maintained communication with Russian President Vladimir Putin and called for a diplomatic solution that does not “humiliate” the country. (https://www.cnn.com/europe/live-news/russia-ukraine-war-news-06-04-22/h_1fef9aff71452480f62b4e5ee94e4329).   

     

UPDATE:

June 3, 2022

  • Putin Discusses Options for Grain Exports: In an interview with Rossiya 1 TV, Russian President Vladimir Putin discussed options to export grain from Ukraine. He suggested that Ukraine could clear its seaports of mines and export through controlled ports, such as Berdyansk and Mariupol. Putin added that overland transport out of Ukraine is also possible, saying Belarus was the “most logical option”, but Western sanctions would need to be lifted on the country for this to occur. He criticized “short-sighted” Western sanctions, and noted that river transport was an option for Ukrainian grain exports. (https://tass.com/economy/1460605).

  • Ukraine Declares Megabank Insolvent:  On Friday, Ukraine’s central bank declared Kharkiv-based Megabank, which counts Germany’s KfW, the European Bank For Reconstruction and Development and the International Finance Corporation as shareholders, insolvent. According to Ukrainian officials, Megabank’s net assets account for 0.5% of the banking sector’s total. (https://ukranews.com/en/news/860937-nbu-classifies-megabank-as-insolvent).  

UPDATE:

June 2, 2022

  • Export Controls Impact Russia’s Tech Industry:The Financial Times reported on the crippling effect that international restrictions on the supply of chips, semiconductors, and other hardware are having on Russia. Although Russia has several domestic chip manufacturers, it relies heavily on importing large quantities of finished semiconductors from foreign manufacturers, which is impacting the supply of products that rely on semiconductors, as well. (https://www.ft.com/content/caf2cd3c-1f42-4e4a-b24b-c0ed803a6245).

UPDATE:

June 1, 2022

  • Russia’s Central Bank Considering Cryptocurrency to Blunt Sanctions’ Impact:Reuters reported Tuesday that Russian Central Bank First Deputy Governor Ksenia Yudaeva said in a briefing with reporters that, “[i]n principle, we do not object to the use of cryptocurrency in international transactions.” She also noted that the bank views crypto with considerable skepticism, saying that “[w]e still believe that the active use of cryptocurrency within the country, especially within Russia’s financial infrastructure, creates risks for citizens and users. We believe that in our country those risks could be reasonably large.”  (https://www.reuters.com/article/ukraine-crisis-russia-cryptocurrency/russias-central-bank-sees-space-for-crypto-in-international-trade-idUSKBN2NH178).

  •  Lavrov Highlights the Importance of OPEC+:Reuters reported Wednesday that Russian Foreign Minister Sergei Lavrov told a news conference in Saudi Arabia that “[t]he principles of cooperation on th[e] basis [of OPEC+] retain their significance and relevance.” His comments come on the heels of a report in the Wall Street Journal Tuesday indicating that some members of OPEC were considering the suspension of Russian oil from the production deal it is set to approve Thursday. (https://www.reuters.com/article/oil-opec-russia-lavrov/russias-lavrov-says-opec-still-relevant-for-moscow-idUSS8N2WX05K).

  • Russian Duma Mulls New Plan to Remove Toxic Waste from Lake Baikal: Radio Free Europereported Wednesday that Russian authorities are considering a new plan to increase iron levels by a factor of 10, chromium levels by 1.3, and mercury by 13 in order to remove toxic waste from the former “pearl of Siberia,” Lake Baikal—a UNESCO-protected ecosystem that holds about 20% of the world’s fresh surface water. (https://www.rferl.org/a/russia-pushes-dangerous-cleanup-plan-lake-baikal/31877177.html).

  • Investors Determine “Failure to Pay Credit Event” has Occurred: Reuters reported Wednesday that a panel of investors on The EMEA Credit Derivatives Determinations Committee had voted “yes” on the question of whether Russia’s failure to pay $1.9 million in potential interest accrued between the maturing of its international 2022 bond on April 4 and its payment of principal and interest due at maturity was made on May 2 constituted a “credit event” that would permit investors to collect a payout on credit default swaps. The committee will reconvene to discuss the issue further Monday, June 6. (https://www.reuters.com/business/russia-failure-pay-credit-event-investor-committee-says-2022-06-01/).

  • Despite Western Sanctions Impact on Russian Business, Russia Continues to Benefit From Surging Commodity Prices:   Bloomberg reported Wednesday that the surge in commodity prices tied to its invasion of Ukraine and the imposition of sanctions by the U.S. and its allies have paradoxically been a boon to Russian energy, wheat, nickel, aluminum, and palladium exports, generating $800 million per day. Even as Europe halts and/or slows its energy purchases, Russia is projected to have $285 billion in revenues from oil and gas this year alone, exceeding its 2021 revenues by more than 1/5th.(https://www.bloomberg.com/news/features/2022-06-01/has-sanctioning-russia-worked-oil-gas-sales-put-285b-in-putin-s-pocket).

UPDATE:

May 31, 2022

  • Russia to Halt Board of Director Elections for Sanctioned Companies: Prime Minister Mikail Mishustin reportedly announced that the Russian government will permit sanctioned Russian companies to temporarily pause elections for their boards of directors. Additionally, the plan would preserve the powers of the current board without holding a reelection. (https://tass.com/economy/1458531).

UPDATE:

May 30, 2022

  • Russia Establishing New Avenue for Managing Bond Payments: Russian Finance Minister Anton Siluanov is reported to have stated that Russia will establish a system for bond payments similar to that for natural gas payments, after the US government let an authorization for such payments to lapse (although the EU has not announced such restrictions). Under the proposed system, investors would have to open both a foreign currency and ruble account at a Russian bank, provide instructions permitting in change, and then Russia would make bond payments in rubles which would be exchanged for the correct foreign currency for the benefit of the investor. (https://markets.businessinsider.com/news/bonds/russia-bond-payments-debt-default-us-sanctions-rubles-natural-gas-2022-5).

  • Hackers Release Customer Data Stolen from Sberbank: Amid claims of hacking by hacking collective Anonymous, major website outages, and a statement from Sberbank that it fought against the largest DDoS attack in its history on May 6, card details of 113,476 Sberbank customers are reported to be circulating on the dark web since the beginning of Russia’s invasion of Ukraine. (https://www.telegraph.co.uk/business/2022/05/29/hackers-wage-war-russias-largest-bank/)

  •  Central Bank of Russia to Launch Digital Ruble as Early as Next Year: Reporting in Forbes Russia quoting the Central Bank of Russia’s First Deputy Chairman Olga Skorobogatova stated that the CBR has decided to speed up the development of the digital version of the ruble in response to western sanctions, launching the pilot program with real transactions and users in April 2023 rather than in 2024. (https://news.bitcoin.com/bank-of-russia-steps-up-efforts-to-issue-digital-ruble-due-to-sanctions/).

UPDATE:

May 29, 2022

  • Ukraine Seizes Rosneft Assets in the Country: On Saturday, the Ukrainian Security Service posted on its Telegram channel that it had initiated seizure of Russian company Rosneft’s assets currently located in Ukraine. Rosneft’s license to provide electricity in Ukraine had previously been suspended, and its 20 million hryvnia of assets in Ukraine had already been frozen. (https://tass.com/world/1457279).

  • Ukrainian Orthodox Church Branch Breaks Ties with Russia Over War: The Ukrainian Orthodox Church-Moscow Patriarchate, an eastern branch of Ukraine’s Orthodox Church that remained loyal to Moscow after a 2019 schism permitted Ukrainian Orthodox Churches to separate from the Russian Orthodox Church, has said it will break with the Russian church over the country’s invasion of Ukraine. Ukrainian Orthodox leadership stated that it has sought “full independence” from the Russian Orthodox Church. (https://www.reuters.com/world/europe/moscow-led-ukrainian-orthodox-church-breaks-ties-with-russia-2022-05-28/).

UPDATE:

May 27, 2022

  • Russia Eases Currency Restrictions on Oil and Gas Payments for “Reliable Partners”: Speaking on Friday, Russian President Vladimir Putin stated, “we are extending the practice of payments [for energy products] in the national currencies for those countries that have proven themselves as reliable partners for Russia.” Russia is pushing “unfriendly” countries to pay for oil and gas shipments in rubles. (https://www.cnn.com/europe/live-news/russia-ukraine-war-news-05-27-22/h_.4e4d424ccf1883892eedc1b6ea33eed5).  

  • Ukraine Asks Germany to Reduce Shipments through Nord Stream I Pipeline: In a televised address on Friday, Serhiy Makogon, the head of Ukraine’s gas system operator called on Germany to severely curtail its shipments through Nord Stream I. He noted that Ukraine had formally sent a letter to Germany arguing that the pipeline is allowed under German law so long as it contributes to the strengthening of the security of gas supplies to Europe, but, as recent shutoffs show, Russia has violated these principles. (https://www.reuters.com/business/energy/ukraine-demands-germany-cut-or-halt-nord-stream-1-gas-flows-2022-05-27/).

  • Small Trading Firms Help Export Russian Oil: The Wall Street Journal reported on Friday that smaller trading firms, like Paramount Energy & Commodities SA and Coral Energy Pte, are quickly expanding their trades in Russian oil as major traders like Trafigura, Vitol, Glencore, and Gunvor Group withdraw from the Russian market. These trades do not violate western sanctions on Russia; recent EU restrictions on trades with state-owned Rosneft inspired large traders to withdraw from the market entirely, and smaller firms picked up the slack. (https://www.wsj.com/articles/little-known-commodity-traders-help-russia-sell-oil-11653643583?mod=livecoverage_web).

  • Russian Finance Minister Denies Allegations of Default: On Friday, Russian Finance Minister Anton Siluanov stated, “current statements about the default are out of touch [with the reality] at all. This is the default of Western countries before themselves. We have money. I reiterate we will make payments.” As the US blocked Russia’s ability to make interest payments to American banks, Russia is more likely to default on its debt. (https://tass.com/economy/1457065).

UPDATE:

May 26, 2022

  • Russian Supply Shortages of Western Goods Worsen: Building on previous reports of shortages in the aviation sector, Russian logistics officers are reporting widespread shortages of western goods, according to reporting from The Washington Post. As sanctions and individual business withdrawals reduce the amount of western goods for sale in the country, Russian companies are picking up the slack, but logistics officers state that the quality is reduced particularly for the price. (https://www.washingtonpost.com/world/2022/05/26/russia-economy-aviation-sanctions-shortages/).

  • Ukraine Urges Tech Companies to Leave Russia: In an interview at the World Economic Forum on Wednesday, Ukrainian Technology Minister Mykhailo Fedorov, Ukraine’s Minster of Digital Transformation, called out tech firms Cloudflare and SAP for continuing operations in Russia. He praised tech companies that have already departed Russia, and is “convinced eventually that they will leave Russia, sooner or later.” (https://www.cnn.com/2022/05/25/business/ukraine-tech-companies-davos/index.html).

UPDATE:

May 25, 2022

  • Insurance Restrictions May Impact Russian Oil Market: On Wednesday, Reuters reported that, despite Russia’s ability to withstand energy sector sanctions thus far, upcoming restrictions from western insurance companies, which dominate the oil shipping insurance market, may prove more difficult to overcome. The restrictions will fully come into place in June and July, when EU restrictions on insurance fully expire. Even if insurance companies in countries sympathetic to Russia fill the gap, their own insurers may increase their premiums for dealing with a sanctioned entity. (https://www.reuters.com/markets/commodities/russian-oils-achilles-heel-insurance-2022-05-25/).

UPDATE:

May 24, 2022

  • Russian Parliament Advances Press Censorship Bill: On Tuesday, the State Duma advanced a bill that would give the Russian Prosecutor General’s office the power to invalidate the registration and revoke the license of media outlets through request to the state media regulator if the media company publishes “illegal, dangerous information by the media and the broadcaster, including unreliable socially significant information.” Currently, media outlets may only be shut down by court order. The legislation now must go through two more readings in the Duma before moving to the Federation Council and President Putin’s desk, steps that are considered formalities.  (https://www.wsj.com/livecoverage/russia-ukraine-latest-news-2022-05-24/card/russia-moves-forward-with-media-censorship-bill-EIkbbY0VtPHaRDCq6LI0).  

  • Russian Foreign Minister Calls for Deeper Ties with China: Speaking on Tuesday, Russian Foreign Minister Sergei Lavrov said that Russia needs to stop being dependent in any way on suppliers from the west, adding that the recent sanctions imply “our economic ties with China will grow even faster. He stated, “When we can finally count only on ourselves and on countries which have proven themselves reliable and do not dance to someone else’s tune, then if Western countries come to their senses and begin to propose some form of cooperation, it will be up to us to decide.” (https://www.cnn.com/europe/live-news/russia-ukraine-war-news-05-24-22/h_b48afc213ddbb2ff3042522644d73bef).

UPDATE:

May 23, 2022

  • Zelenskyy Calls for “Maximum Sanctions” at Davos: On Monday, Ukrainian President Volodymyr Zelenskyy delivered a virtual address at the World Economic Forum in Davos, Switzerland. The President called for “maximum” sanctions on Russia, which included an oil embargo, blocking all Russian banks, and cutting off trade with Russia completely. He also advocated for the complete withdrawal of foreign companies from Russia, and asked for $5 billion per month in funding to support the Ukrainian economy. (https://www.latimes.com/world-nation/story/2022-05-23/ukraine-zelensky-urges-maximum-sanctions-russia-davos).

  • Ukraine, Poland Announce Joint Customs Control: On Sunday evening, Ukrainian President Volodymyr Zelenskyy announced that the country had established a joint border customs control arrangement with Poland. The move comes after Polish President Andrzej Duda visited Kyiv over the weekend and expressed willingness to develop closer ties between the countries. The arrangement is intended to streamline entry and exit procedures for goods and persons between the countries; Poland is a major destination for refugees from the conflict. (https://www.reuters.com/world/europe/ukraine-poland-agree-joint-customs-control-ease-movement-people-goods-2022-05-23/).

  • Sovcomflot Sells One Sixth of Fleet to Repay Debts: Russia’s biggest shipping group, Sovcomflot, and its western lenders have sold a sixth of its Kremlin-owned fleet as part of plans to repay debts and eventually return to international markets once sanctions are lifted. The asset sale comes as energy executives warn Russia’s oil and tanker industry will increasingly resemble Iran and Venezuela, which rely on a “dark fleet” of vessels operating outside international markets. These ships turn off location signals, register under false flags and use shell companies. (https://www.ft.com/content/31b80bbb-59f3-4d7a-b901-329867797d41).

  • Putin Says Russia “Withstanding” Sanctions: In a meeting with Belarusian President Alexander Lukashenko in Sochi, Russia, Russian President Vladimir Putin stated “the Russian economy is withstanding the impact of the sanctions, and withstanding it quite well,” according to macroeconomic indicators. GDP estimates widely predict that the Russian economy will contract in the near future due to sanctions. (https://www.cnn.com/europe/live-news/russia-ukraine-war-news-05-23-22/h_459a18ff68a5eb1a1841b04d6865d651).

UPDATE:

May 22, 2022

  • Russian Foreign Ministry Publishes Full List of Americans Banned from Traveling to Russia, Adds Canadian Officials to List: On Saturday, the Russian Foreign Ministry announced for the first time the entire list of 963 Americans banned from traveling to Russia. The list confirms that US diplomatic and military personnel, like Secretary of State Antony Blinken, Defense Secretary Lloyd Austin and CIA chief William Burns, but also includes actor Morgan Freeman and journalists Susan Glasser of the New Yorker, Bret Stephens of the New York Times, David Ignatius of the Washington Post and Nick Paton Walsh of CNN for “inciting Russophobia”. The Ministry also announced the addition of 26 Canadians to the travel ban list, including Sophie Gregoire Trudeau, wife of Canadian Prime Minister Justin Trudeau. (https://www.wsj.com/livecoverage/russia-ukraine-latest-news-2022-05-21/card/russia-bans-entry-to-nearly-1-000-americans-UgPN8GHGy7ZS8d7p9RUi).  

  • Sanctions Impacting Aeroflot Repairs:Bloomberg reported on Sunday that Aeroflot, Russia’s flag carrier, is experiencing difficulty in sourcing parts for its planes, many of which are manufactured by US company Boeing and EU company Airbus. Sanctions from the EU and US are blocking these companies from supplying the Russian airline, and it is struggling to shift to a domestically-made, primarily domestic-serving model. Bloomberg reports that the company has enough supplies to repair its Boeing and Airbus planes for three more months before it must start “cannibalizing” other Airbus and Boeing jets for their parts. (https://www.bloomberg.com/news/articles/2022-05-22/aeroflot-is-back-to-the-future-as-sanctions-ground-its-ambitions).

  • Russian Transportation Secretary Says Sanctions Have “Practically Broken All” Trading Corridors: Speaking to industry representatives during a visit to the Astrakhan region, Russian Transportation Secretary Vitaly Savelyev said, “The sanctions that have been imposed on the Russian Federation today have practically broken all logistics [corridors] in our country. And we are forced to look for new logistics corridors together.” He added that the country is exploring options along the International North–South Transport (INSTC) corridor, which links India with central Asian countries. (https://www.cnn.com/europe/live-news/russia-ukraine-war-news-05-21-22/h_b135cf557a352152f3a0f501193db208).

  • Moody’s Downgrades Ukraine Credit Rating: On Friday, Moody’s downgraded Ukraine’s credit rating to Caa3, which indicates that the agency expects a recovery in the event of default of typically between 65 percent to 80 percent. In a statement, the agency said, “While Ukraine is benefitting from large commitments of international financial support, helping to mitigate immediate liquidity risks, the resulting significant rise in government debt is likely to prove unsustainable over the medium term,” especially as the military conflict continues. (https://www.bloomberg.com/news/articles/2022-05-20/moody-s-downgrades-ukraine-as-drawn-out-war-raises-debt-risks).

  • Ukrainian Presidential Advisor Responds to Russian Comments on Sanctions Review for Food Exports: Speaking on Sunday, Ukrainian Presidential Advisor Mykhailo Podolyak responded to recent reports that Russia would end its blockade of Ukraine’s Black Sea ports if the international community undertook a “review” of sanctions on Russia. He opposed the Russian suggestion, saying, “If you follow the lead in Russia by lifting some of the sanctions, they will continue to escalate the conflict in Ukraine and will set new conditions.” (https://news.yahoo.com/zelenskys-office-comments-possible-lifting-143500916.html).  

UPDATE:

May 20, 2022

  • EU Nationals Resign from Rosneft Board: In addition to the Vice President resignations reported yesterday, Rosneft announced on Friday that two European members of its board of directors, former German Chancellor Gerhard Schroder and Matthias Waring, were resigning from their roles at the company. Schroder was the subject of an EU resolution calling on EU citizens to resign from board positions at major Russian companies, and he lost his office space in the German parliament building as a result of his ties to Russia this week. (https://www.wsj.com/articles/senior-executives-flee-russian-oil-giant-rosneft-11653041804?mod=hp_lead_pos3).

  • Former Russian President Expects Sanctions to Stay in Effect “For a Very Long Time”: Speaking to a government panel on Friday, former Russian President Dmitry Medvedev, now the deputy chairman of Russia’s security council, said that he expects the sanctions imposed on Russia to remain in effect “a very long time… the way it was in the past, including the Soviet era. In other words, for decades.” He urged Russia to rely entirely on its own resources as a result. (https://tass.com/world/1453977).

  • Russian Central Bank Releases GDP Estimates:On Friday, Kirill Tremasov, the head of the Russian Central Bank’s Monetary Policy Department, told a conference on Friday that the Bank expects Russian GDP to contract by 8 to 10 percent in 2022, 0 to 3 percent in 2023, and to grow by 2.5 to 3.5 percent in 2024. (https://tass.com/economy/1453927).

UPDATE:

May 19, 2022

  • Russia Pins Food Crisis on Foreign Sanctions: Speaking in response to calls from the UN to end the blockade on Ukraine’s Black Sea ports to allow agricultural exports, Russian Deputy Foreign Minister Andrei Rudenko said, “You have to not only appeal to the Russian Federation but also look deeply at the whole complex of reasons that caused the current food crisis and, in the first instance, these are the sanctions that have been imposed against Russia by the U.S. and the EU that interfere with normal free trade, encompassing food products including wheat, fertilisers and others.” (https://www.reuters.com/world/europe/moscow-says-opening-ukraine-ports-would-need-review-sanctions-russia-interfax-2022-05-19/).

  • Russian Economic Growth Slows More than Expected: The Russian Federal Statistics Service announced on Wednesday that the Russian economy grew by 3.5 percent in the first quarter, down from a 4 percent gain in the three preceding months. This result was below Bloomberg’s median forecast of economists, who expected the Russian economy to grow by 3.7 percent. Since this result reflects first quarter data, it only partially includes the invasion of Ukraine, which began on February 24, and subsequent sanctions. (https://www.bloomberg.com/news/articles/2022-05-18/russia-s-economy-slowed-down-more-than-expected-in-first-quarter).

  • Russian Deputy PM Claims Russian Oil Export Rebound: On Thursday, Russian Deputy Prime Minister Alexander Novak said that Russia is increasing oil production in May by 200,000 to 300,000 barrels per day, after a decline in April. He noted that, after receiving a “certain shock” related to is previous export partners, Russia “does not have serious problems” in the oil export industry, and the country is looking for new partners. (https://tass.com/economy/1453301).

UPDATE:

May 18, 2022

  • Google’s Russian Subsidiary Files for Bankruptcy; Company Moves Employees Out: On Wednesday, Google’s Russian subsidiary, Google LLC, submitted a notice of intent to declare bankruptcy to Russia’s Fedresurs agency. In a statement, Google said, “Russian authorities’ seizure of Google Russia’s bank account has made it untenable for our Russia office to function, including employing and paying Russia-based employees, paying suppliers and vendors, and meeting other financial obligations.” The company has already paused most commercial operations in Russia, though free services like YouTube, gmail, and Maps, will remain unaffected. Sources at Google also confirmed that Google is moving its employees out of Russia, with most keeping their jobs and moving to Dubai, and the rest remaining in Russia and leaving the company.  (https://www.wsj.com/articles/google-subsidiary-in-russia-to-file-for-bankruptcy-11652876597?mod=livecoverage_web).  

  • Russia Takes First Steps to Withdraw from WTO and WHO: Russian State Duma Deputy Speaker Pyotr Tolstoy confirmed on Wednesday that the Foreign Ministry had sent a list of international organizations that “bring no benefit” to Russia; the Duma will “analyze them and… propose to withdraw.” Tolstoy added, “the next step is to withdraw from the WTO and the WHO, which have neglected all obligations towards our country.” (https://www.politico.eu/article/russia-takes-first-steps-to-withdraw-from-wto-who/).

  • Russia Expels Canadian Broadcaster: On Wednesday, the Russian government moved to close Canadian media company CBC’s Moscow bureau and strip its journalists of visas and accreditation. The move is seen as retaliation for Canada’s decision to remove RT and RT France from the list of non-Canadian programming services and stations authorized for distribution in Canada. CBC executives condemned the development and confirmed that the company would continue covering Russia from outside the country. (https://www.cbc.ca/news/world/russia-closes-cbc-bureau-1.6457668).

  • Soviet-Era Car Brand Returns at Former Renault Plant: The Mayor of Moscow announced on Wednesday that the previously defunct Soviet-era Moskvich car brand would be returning to production at a facility previously used by French automaker Renault. Renault announced the sale of its Russian business earlier this week. The Mayor added that Moskvich will attempt to retain as many employees from the previous facility as possible and source parts from Russian producers. (https://www.cnn.com/2022/05/17/business/renault-moskvich/index.html).

  • Russia Seized 113 Planes from Aircraft Leasing Company Post-Invasion: On Wednesday, AerCap Holdings, an aircraft leasing company that is the largest owner of jets in the world, stated on Wednesday that it lost 113 jets shortly after the invasion of Ukraine due to Russian government aircraft seizures. The company was able to recover 22 jets before they were seized, but still had to report a $2.7 billion pre-tax charge on its first quarter earnings statements. (https://www.cnn.com/2022/05/17/business/aercap-russian-planes-sanctions/index.html).

  • Analysts See Difficulties in Russian Energy Markets: Oil and gas industry analysts have reported frequent shutdowns and divestment from energy extraction projects in Russia, indicating that Russia will face difficulty in meeting its oil and natural gas extraction goals in the coming years, according to a New York Times report released on Wednesday. (https://www.nytimes.com/2022/05/18/business/russia-energy-oil-gazprom-lng.html).

  • International Gymnastics Federation Bans Russian Gymnast for 12 Months for Pro-War Symbol: On Wednesday, the International Gymnastics Federation banned Russian gymnast Ivan Kuliak from competition for one year after he wore a “Z” symbol, widely known as a signal of support of the Russian invasion of Ukraine, on the podium next to a Ukrainian gymnast at a meet in Qatar. Kuliak must also surrender his bronze medal and any prize money from the competition. (https://www.cnn.com/2022/05/18/sport/ivan-kuliak-banned-russian-gymnast-spt-intl/index.html).

UPDATE:

May 17, 2022

  • Putin Discusses Foreign Energy Sanctions in Industry Meeting: During a Tuesday meeting with representatives from the Russian energy industry, Russian President Vladimir Putin stated “European countries continue to introduce new sanctions on oil and gas markets. All of this is leading to inflation, but instead of admitting their own mistakes, they’re looking for someone to blame.” He added, “the Europeans recognize that they cannot completely give up on Russian energy resources.” (https://www.cnn.com/europe/live-news/russia-ukraine-war-news-05-17-22/h_03a854fbe6d71633d70f78e96d17a81c).

  • Russia Reduces Regulatory Standards as Automakers Cease Operations in the Country:On Tuesday, Russia introduced a Presidential Decree that reduced regulatory requirements for cars produced in Russian territory. The new rules now permit the sale of cars without airbags, antilocking brakes, and seatbelt emergency locking retractors through February 1, 2023. The decree also reduces emissions standards. The move comes as major foreign automakers announced the suspension of operations in Russia. (https://www.cbsnews.com/news/russia-ukraine-war-sanctions-putin-safety-environmental-standards-cars-airbags/).

  • Russia Withdraws from Council of the Baltic Sea States: On Tuesday, the Russian government released a statement saying it was withdrawing from the Council of the Baltic Sea States (“CBSS”), saying, “NATO and EU states within the Council rejected the equal dialogue and the principles that this Baltic regional structure was created upon, and they gradually turn the council into an instrument of anti-Russian politics.” The move comes after Sweden and Finland announced their intent to join NATO. (https://tass.com/politics/1452051).

UPDATE:

May 16, 2022

  • New Russian Legislation Refuses to Fulfill EHCR Decisions Post-March 16: On Monday, members of both houses of Russian parliament introduced legislation stating that Russia would no longer be bound by European Court of Human Rights (“ECHR”) decisions issued after March 16, 2022. The bill also reportedly contains mechanisms “to ensure Russian citizens’ basic rights, freedoms and legitimate interests.” (https://tass.com/politics/1451633).

  • New York Times Profiles Challenges in Sanctioning Putin’s Family: On Monday, The New York Times released a profile of Vladimir Putin’s secretive family life and how it is impacting sanctions programs. The profile describes a fractured family life, with one dissolved marriage, one alleged mistress, two publicly identified daughters and four alleged children from other relationships; it notes that effectively sanctioning this complicated web of individuals and properties scattered across several countries is difficult. (https://www.nytimes.com/2022/05/13/world/europe/putin-family-wealth-sanctions.html). 

UPDATE:

May 15, 2022

UPDATE:

May 13, 2022

  • Russian Shipping Activity Still Strong, Despite Sanctions: According to shipping tracker Refinitiv, Russian crude oil shipments climbed to 25 million metric tons in April, up from 24 million metric tons in December. These trades are usually set well in advance via contract, which companies are attempting to not break. Tracking by Lloyds List Intelligence shows similar trends in bulk shipping. This situation may change as a result of possible EU energy sanctions. (https://www.nytimes.com/2022/05/13/business/economy/russia-shipping-sanctions.html).

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