Ukraine/Russia

Finland’s Uniper hit best seen as defence spending

12 Jul 2022

Helsinki wants Berlin to rescue the ailing German energy group, but limit the hit to Finnish owner Fortum. Germany doesn’t agree. Finns would be better off seeing any dilution from a forthcoming capital hike as part of the cost of de-Russifying. Like the cost of joining NATO.

War helps Russian nickel king expand his realm

5 Jul 2022

Tycoon Vladimir Potanin may merge Norilsk Nickel with aluminium maker Rusal. The West would be extra wary of sanctioning such a giant for fear of roiling metals markets. The pair may have some synergies, but their two main owners don’t get on. It would be a governance nightmare.

Robinhood’s reversal, Russian oil cap

30 Jun 2022

The digital brokerage is worth less than a quarter of its $32 bln IPO value. In this Viewsroom podcast, Breakingviews columnists argue that its $7 bln cash pile and ample user base make it an attractive target. Also, Western leaders’ plan to restrict funds to Moscow may backfire.

Uniper woes could force reality check on Berlin

30 Jun 2022

The German utility needs state support after Russia cut gas supplies, forcing it to buy more expensive fuel instead. A better alternative would be for the regulator to allow Uniper to pass the cost on to consumers, dampening demand. The risk of open-ended bailouts helps its case.

Russia’s economy will soon be unrecognisable

16 Jun 2022

When the Ukraine war eventually subsides, Moscow will try to tempt companies and investors back. But its $1.5 trln GDP will have changed dramatically, with poorer consumers and more basic modes of production. Returnees will find a very different economic beast.

How sanctions against Russia could backfire

26 May 2022

The threat of financial punishment did not prevent President Vladimir Putin from invading Ukraine. History shows that economic penalties can stoke conflict by pushing countries to be more self-sufficient, Edward Chancellor writes. Investors risk being stuck with stranded assets.

Seizing oligarch assets is a slippery slope

26 May 2022

The EU hopes to confiscate $31 bln of yachts and villas from blacklisted billionaires. Washington is mulling similar steps. However wrong Russia’s invasion of Ukraine may be, short-circuiting the criminal process to seize property risks weakening trust in Western rule of law.

U.S. sanctions give Russia default it doesn’t need

25 May 2022

The Treasury won’t let Moscow pay U.S. bondholders, tipping it into default. The move further isolates Vladimir Putin but will have minimal impact. It’s a surreal twist given Russia can still pay its debts, while battlefield foe Ukraine urgently needs relief but isn’t getting it.

Ukraine’s spare energy can help itself and Europe

20 May 2022

The war-torn nation generates more electricity than it needs, and from carbon-neutral nuclear plants, too. But its links to the EU power grid are sketchy. Helping Ukraine bolster exports to the EU would support Kyiv’s economy while easing the bloc’s energy headache.

EU funds can ease, not end common energy pain

18 May 2022

Brussels has earmarked 300 bln euros to cut fossil fuel ties with Russia. Rising rates make cheap, repurposed Covid-rescue loans more attractive to many EU states, increasing the chance they’ll be used. But higher fuel purchases will still have to come from national budgets.

Using Russian assets in Ukraine would be a mistake

17 May 2022

Seizing $200 bln of central bank reserves frozen by the EU and U.S. could provide financial relief and moral comfort to the war-torn country. But it would also trigger legal fights and give Russia even less reason to back down. Confiscation is no substitute for a realistic plan.

Western companies have 50 bad ways to leave Russia

16 May 2022

Multinationals can sell out like McDonald’s, shut down like Zara owner Inditex or shrink operations like Nestlé. Hopes of finding a Chinese or Indian buyer may prompt some to drag their heels. But the threat of forced nationalisation gives others an incentive to hurry.

Renault’s Russia exit plans mix logic and delusion

10 May 2022

The French carmaker could sell its Russian assets for a symbolic euro with a plan to buy them back at a later date. Its hope for a “return to normal” after the war in Ukraine sounds optimistic, if not delusional. But for now, Renault sheds a burden and avoids the Kremlin’s ire.

Putin’s gas shock is acid test of EU unity

27 Apr 2022

In severing Polish and Bulgarian supply, the Russian leader shattered a fragile equilibrium that had seen European energy buyers fund his war. He hopes other EU states will carry on, dividing the bloc. Instead, Europe should backstop the costly process of ditching Moscow’s fuel.

Russia risk is ghost of banks’ sanctions future

22 Apr 2022

In the hunt for oligarchs and blacklisted firms, U.S. authorities are treating lenders as allies rather than adversaries. Prospective prosecutors may take a different view. Banks with past legal troubles might prefer to shun Russian business. Still, there are lots of grey areas.

Sanctions sound alert for art – and its regulators

20 Apr 2022

Private sales and the use of shell companies make for anonymity. Russians are not top of the art-world heap, but recently imposed financial constraints and the rise of digital assets could change that. U.S. oversight has not kept up. Dealers and watchdogs alike need to wise up.

IMF’s search for Ukraine help should start at home

19 Apr 2022

The Washington-based institution expects Russia’s invasion to cut global growth to 3.6% this year, while keeping inflation higher for longer. It also wants international cooperation to bolster Kyiv’s war-torn economy. In that regard, the fund’s own assistance is falling short.

India’s Russian oil binge carries hidden costs

14 Apr 2022

New Delhi is filling its boots with Moscow’s cheap crude, just as Europe and traders like Vitol start to turn away. The aggressive ramp-up carries longer-term risks. As a keen buyer, India will find it hard to get waivers from sanctions if the West targets Russia’s energy trade.

Stranded jets are least of plane lessors’ problems

14 Apr 2022

Big fleet-owners like AerCap may have to write off $10 bln of planes trapped due to Russian sanctions. Ultimately, though, insurers should cover their losses. A bigger brake on the aircraft-leasing industry’s rapid ascent is the rising cost of debt from jittery lenders.

JPMorgan rolls with early 2022 punches

13 Apr 2022

The giant lender took hits from a slump in financial-market activity and Russia’s invasion of Ukraine, reporting a 42% dive in quarterly profit. Wall Street peers are likely to sport similar bruises. But a strong U.S. economy and rising interest rates will soften the blows.