France was one of the most reluctant European Union countries to agree to impose sanctions on Russia for grabbing Crimea off Ukraine. So it’s perhaps not altogether surprising to see a French investor hobnobbing with Vladimir Putin on the Black Sea peninsular this week and offering to build a tourist attraction in the region.
France’s Puy du Fou International has agreed to build a historical theme amusement park in Crimea that will celebrate the history of Russia and the Black Sea peninsular, the government of Crimea said on Friday. Continue reading »
First western sanctions stopped billionaire Gennady Timchenko from flying around in his luxury jet, now they’re hurting budget Russian air travelers as well. Aeroflot grounded Dobrolet, its fledgling low coster airline, after companies in the European Union suspended co-operation agreements.
Owing to “unprecedented pressure” the low cost carrier had no option but to suspend flights and ticket sales, Aeroflot said. However, analysts said that Russia’s national airline, having already spent about $20m of the $100m budget allocated for Dobrolet, was unlikely to allow the sanctions to force it to give up on the low coster altogether.
“The company has the option of signing new leasing and technical servicing agreements with Asian counter parties, including Chinese ones, according to experts, wrote Sberbank Investment Research in a note on Monday, adding that “this will probably take months and incur additional costs.” Continue reading »
Gazprom has been struggling to adapt to the tectonic changes in global gas markets and has finally decided a fresh face is needed at its foreign trade division. After 12 years in service, Alexander Medvedev has lost his job as head of Gazprom Export and been replaced by one of his former deputies.
Elena Burmistrova, formerly deputy director general for petroleum products, LNG and new gas markets at Gazprom Export has been appointed deputy director of Gazprom Export, replacing Medvedev, Gazprom said on Wednesday. Continue reading »
Rosneft has raised the stakes in its campaign to strip Gazprom of its monopoly over Russian gas exports. In a sharply worded statement on Tuesday, Russia’s state oil company threatened to take Gazprom to court unless it opened up a planned pipeline to China to rival gas producers.
Gazprom has been gearing up to build the Power of Siberia pipeline since signing a $400bn gas export contract with China in May. Linking vast Gazprom controlled gas fields in east Siberia with the Russian Pacific, the 4,000km pipeline will feed gas to domestic consumers and to the Chinese border. Continue reading »
As international budget airlines begin to make headway in the Russian market, Aeroflot has launched its own version of easyJet. Passengers crammed aboard the maiden flight from Moscow to – guess where? – Crimea on Tuesday were waved off by Dmitry Medvedev, Russia’s prime minister. Continue reading »
Tough times ahead for Russian smokers and for the international tobacco groups that feed their obnoxious habit: a ban on smoking in government buildings introduced last year was expanded to include all public places at the weekend, as the Kremlin stepped up the war on Russia’s estimated 40m cigarette addicts. Continue reading »
As Russia steps up control of the internet, electronic payment processors are feeling the heat. Qiwi and PayPal cited security concerns when they halted co-operation with RosUznik, a Russian charity that supports political prisoners, this week. RosUznik suspects political motives.
Founded in late 2011 as a wave of anti-government protests erupted in Moscow, RosUznik collects charitable donations to help fund legal aid for opposition activists undergoing trial or in detention. Continue reading »
Alexander Lukashenko is living up to his reputation as Europe’s last remaining dictator. The president of Belarus has decided to bring back serfdom on farms in a bid to stop urban migration.
Lukashenko has announced plans to introduce legislation prohibiting farm labourers from quitting their jobs and moving to the cities. “Yesterday, a decree was put on my table concerning – we are speaking bluntly – serfdom,” the Belarus leader told a meeting on Tuesday to discuss improvements to livestock farming, gazeta.ru reported. Continue reading »
As western governments impose sanctions on Russia, international majors with interests in the country have stayed out of the fray, saying it’s business as usual. France’s Total, for one, was not going to let the Ukraine crisis halt plans to finalize a deal with Russian Lukoil this week that paves the way for exploration of tight oil reserves in western Siberia.
Total has entered a joint venture with Lukoil to explore the tight oil potential of the Bazhenov formation in western Siberia, the French company said on Friday. Lukoil will have a controlling 51 per cent interest of the project, with Total holding the remaining 49 per cent. After conducting seismic surveys this year, the partners expect to begin drilling in 2015. Continue reading »
As Gazprom bullies Ukraine to settle its $3.5bn gas arrears, Russian domestic gas consumers are also running up multi-billion dollar debts. Ukraine is broke and Russian buyers, hit by the economic downturn, will struggle to pay up. Just as well then that Gazprom has finally clinched a $400bn gas contract with China which opens up a new potential market in the east from 2018.
Gazprom’s customers owed Rbs115.8bn ($3.35bn) for gas at the end of 2013, almost 40 per cent more than on December 31st 2012, Kirill Seleznev, director general of Mezhregiongaz, Gazprom’s gas distribution subsidiary, told reporters in Moscow this week. Continue reading »
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Russia’s super rich have been losing money as the Ukraine crisis escalates but that doesn’t necessarily mean they’ll stop splurging on Russian art. International auction houses are nervously awaiting the results of the next Russia Art Week sales that open in London in less than two weeks’ time. Continue reading »
The International Monetary Fund has slashed its growth forecast for Russia for the second time in less than a month as international sanctions threaten to tip the already weak economy into recession.
Russia’s economy is on track to grow by just 0.2 per cent this year, rather than the 1.3 per cent it forecast earlier this month, the IMF said on Wednesday, warning that further downgrades were likely unless the Ukrainian crisis abated. Continue reading »
With the Ukraine crisis casting a shadow over Russia’s gas trade with Europe, Gazprom has moved to shore up relations with Turkey, its second biggest foreign gas customer after Germany. In talks in Ankara on Monday, Russia’s state gas monopoly agreed to boost capacity in the Blue Stream pipeline that transports gas across the Black Sea to northern Turkey.
On a working visit to Ankara on Monday, Alexander Medvedev, deputy head of Gazprom, met Taner Yildiz, Turkey’s energy minister, for talks aimed at boosting gas co-operation between the two countries. The two men agreed that capacity in Blue Stream should be upgraded to to 19bn cubic meters a year from 16bn cubic meters a year to enhance Turkish energy security. Continue reading »
Russia brushed off the threat of western energy sanctions on Friday and pledged to press ahead with plans to build a new gas export pipeline that would strengthen its hold on European gas markets.
Russia is continuing work on the 2,500km South Stream pipeline that will carry gas across the Black Sea to southern and central Europe, Alexander Novak, Russian energy minister told a press conference in Moscow on Friday. Continue reading »
Russia is rethinking investor friendly dividend reforms as the Ukrainian crisis weighs on its faltering economy. Rules introduced last year that would oblige state companies to put more of their profits in shareholders’ pockets may be shelved, according to a report out on Wednesday.
Russia has been pushing state companies to pay more generous dividends in an effort to improve the country’s investment image and boost interest in upcoming privatisations. Rules introduced in late 2012 setting a minimum 25 per cent pay out were a step in the right direction but, as often happens with Russian regulations, there was room for interpretation. Continue reading »