The previous issue is here.
Recent Analysis and Translations:
An In-Depth Examination Of Donald Trumpâs Ties To Russia And Vladimir Putin
Anna Politkovskayaâs Last Interview to the Regional Russian Press On Day of Her Murder
âThe Dirty Deeds of the Pentagon in Syriaâ: An Example of Russian Propaganda
– What Has Ramzan Kadyrov Been Up To? Quietly Cultivating Regional and Kremlin Officials, Now He Meets with Putin
UPDATE: In fact, the Finanz.ru article is not removed but can be found at another link.
The White House is taking a close look at the $11.3 billion deal reported yesterday involving the purchase of a 19.5% stake in Russia’s oil giant Rosneft, to determine the impact of existing US sanctions on Rosneft, UPI and RFE/RL reported.
White House spokesman Josh Earnest said:
“Experts at the Department of Treasury that are responsible for constructing and enforcing the sanctions regime will carefully look at a transaction like this. They’ll look at the terms of the deal and evaluate what impact sanctions would have on it.”
TASS reported that US and EU sanctions on Rosneft do not formally ban US and European companies from purchasing a stake in Rosneft because the proceeds reportedly go to the Russian government, not the company. Some investors assessed the risk as too great. Presidential spokesman Dmitry Peskov said that sanctions would not impact the deal due to “its structure,” newsru.com reported.
Russia is expecting such a great influx of foreign currency from the deal — estimated on December 6, the date of the announcement, at 711.543 billion rubles at that day’s ruble/euro exchange rate — that President Vladimir Putin has ordered that the currency be exchanged in stages so as not to upset currency markets, Gazeta.ru reported.
The Kremlin was very eager for the sale, given the need to cover budget deficits induced by deteriorating economy, caused by falling oil prices and Western sanctions. Rosneft itself has been performing poorly, with it’s third-quarter profit off by 77% compared to 2015, UPI reported.
Russian press coverage of the “deal of the year” as it has been dubbed has been generally upbeat. But Gazeta has reported that the deal has not yet been finalized as we reported yesterday and may not bring Russia as much as claimed. Gazeta cited a minority shareholder who warned that Glencore may have made the deal to get discounted shipments of Rosneft oil.
Article Critical of Rosneft Deal on Financial News Site
Milov discounts the idea that Qatar was involved in the Rosneft deal as a pay-back for the OPEC agreement to reduce oil production:
“…here there is no direct connection, OPEC’s agreement will be fulfilled or not, the presence of a minority portfolio of shares in a Russian oil-producing company will not affect that at all.” He says Qatar has not been interested in investing in Russian oil exploration for years, and its investment fund’s main investments are in high-tech fields, not oil and gas. So most likely this is all fairly banal: it is simply profitable for Qatar to improve the quality of its problematic investments in Glencore.”
RBC, the independent wire service that has been struggling with a lawsuit from Rosneft over purported “damage to its business reputation,” has been hoping that the judge reviewing the case would realize the obvious — that a company that is making more profits could hardly be said to suffer a loss.
As Moscow Times reported:
That has left some in the company frustrated at what they claim is an illogical and unfair case. “This is a totally Kafkaesque case; the damages being claimed don’t exist, we cannot find experts to testify in our favor, they seem scared, and the party that can easily defuse this case, BP, is absent,” says Derk Sauer, vice president of Onexim Group, RBC’s parent company. “That’s fighting a legal battle with your hands tied to your back.”The defense attempted to petition the court to summon BP as a witness, but the request was rejected following Rosneft’s claim that BP was an uninterested party. BP said it had “no comment” and “remain committed to further development of cooperation with Rosneft both as shareholder and via joint ventures.”
— Catherine A. Fitzpatrick