October 13, 2024

TechNewsInsight

Technology/Tech News – Get all the latest news on Technology, Gadgets with reviews, prices, features, highlights and specificatio

Western companies move to exit Russia as sanctions tighten

Western companies move to exit Russia as sanctions tighten

  • BP to divest Rosneft stake worth $25 billion
  • Pressure other energy companies to follow suit
  • Shares of companies with Russian origins were hit
  • Some Russian banks have closed their doors to the SWIFT system
  • The European Union, Canada and Britain closed the airspace of Russia

Feb 28 (Reuters) – Energy giant BP, global bank HSBC and the world’s largest aircraft leasing company AerCap joined a growing list of Western companies looking to exit Russia on Monday, as Western sanctions tightened the noose on Moscow over its invasion of Ukraine. .

The West has sought to punish Russia with a range of measures, including closing airspace to Russian aircraft, closing some Russian banks from the global SWIFT financial network, and limiting Moscow’s ability to deploy its $630 billion in foreign reserves. Read more

The Russian economy was already reeling on Monday. The ruble fell as much as 30% to an all-time low, while the central bank doubled its key interest rate to 20%, kept stock and derivatives markets closed, and temporarily banned brokers from selling securities held by foreigners to help limit losses. Read more

Register now to get free unlimited access to Reuters.com

BP, Russia’s largest foreign investor, suddenly announced over the weekend that it was giving up its 20% stake in state-controlled Rosneft. (ROSN.MM) At a cost of up to $25 billion, which would cut the British company’s oil and gas reserves in half and reduce BP’s production by a third. Read more

BP’s decision, which followed talks with the British government, has highlighted other Western companies that have stakes in Russian oil and gas projects, such as the US company ExxonMobil. (XOM.N)French TotalEnergies (TTEF.PA) Britain paralyzed (sigh).

See also  General Motors is investing $1 billion to produce new heavy-duty pickup trucks

Equinor (EQNR.OL)The Norwegian state-owned energy company said it would begin to liquidate its joint ventures in Russia, while Norway’s sovereign wealth fund, the world’s largest, will also spend about 25 billion Norwegian kroner ($2.8 billion) in its Russian assets. Read more

Australia’s sovereign wealth fund also said it intends to end its exposure to companies listed in Russia. Read more

Large parts of the Russian economy will be a no-go zone for Western banks and financial firms after the decision to isolate some of its banks from SWIFT, a secure messaging system used in trillions of dollars worth of transactions around the world.

The European arm of Sberbank (SBER.MM)On Monday, the European Central Bank, Russia’s largest lender, warned of failure, after its deposits were rushed. Read more

British HSBC Bank (HSBA.L) A note seen by Reuters showed that the company said it had begun terminating ties with a group of Russian banks, including the second-largest VTB Bank, one of the banks targeted by the sanctions. Read more

Stocks fell

Amid growing economic pressure on Russia, even neutral Switzerland has said it is likely to follow the European Union’s lead by imposing sanctions and freezing Russian assets. Read more

As Russians queued at automated teller machines (ATMs) over the weekend over fears sanctions could lead to a cash shortage, Western companies doing business with Russia took a hit when markets opened on Monday. Read more

See also  Employment opportunities decreased slightly in January. Rose layoffs

Nokian Tires (TYRES.HE)which said last week it would shift some production to Finland from Russia where it has a factory and warehouse, withdrew its guidance for 2022, hurting its shares.

Shares in Societe Generale also fell (SOGN.PA)the French bank that owns Russia’s Rosbank, and the carmaker Renault (RENA.PA)Which controls the Russian automaker Avtovaz.

Finnair lost a fifth of its value after it withdrew the 2022 directive due to the possible closure of Russian airspace, after European countries and Canada took the unprecedented step of closing their airspace to Russian aircraft. Read more

US officials said the United States was considering a similar move.

The leasing companies said they would terminate hundreds of aircraft lease contracts with Russian airlines due to the sanctions. Analytics firm Cirium said Russia has 980 passenger planes in service, of which 777 are leased and 515 are leased from foreign companies. Read more

Ireland’s AerCap Holdings (AER.N)The world’s largest aircraft leasing company, where about 5% of its fleet is leased to Russian airlines, said it would stop leasing to Russia. Asian Lessor BOC Aviation (2588.HK) It said most of its planes in Russia, or about 4.5% of its fleet, would be affected. Read more

United Parcel Service Inc. is based in the United States (UPS.N) and FedEx Corp (FDX.N)Two of the world’s largest logistics companies said they have halted deliveries to Russia and Ukraine. Read more

The European Union has banned Russian media outlets RT and Sputnik, while Canadian telecoms companies have also stopped offering RT. Google has banned RT and other Russian channels from receiving money for ads on websites, apps and YouTube videos, similar to Facebook’s move. Read more

See also  Oil prices are approaching 3-month lows as concerns about demand grow

The head of the European Union’s internal market told the CEOs of Google’s owner Alphabet (GOOGL.O) It united on YouTube on Sunday to ban users who promote war propaganda as part of measures to stop misinformation about Ukraine.

Register now to get free unlimited access to Reuters.com

Additional reporting by Ron Bosso and Dmitri Zhdanikov in London, Fu Yun Che in Brussels, Jamie Freed in Sydney, Caroline Cohen in London, Saeed Azhar in Dubai; Written by Carmel Crimmens and Edmund Blair; Editing by Grant McCall

Our criteria: Thomson Reuters Trust Principles.