Dudley's defense: why the head of BP stood up for Rosneft and Gazprom

The head of BP, Bob Dudley, said that restrictions on Rosneft (at BP 19.75%), Gazprom and LUKOIL, similar to sanctions against UC Rusal Oleg Deripaska, will not be imposed. Otherwise, the power system of Europe is waiting for the collapse, he warned.
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The head of BP, Bob Dudley, doubted the possibility of imposing the United States on the largest energy companies in Russia with such tough sanctions as those imposed against UC Rusal. According to Dudley, the collapse of the European power system could be the consequence of this.

“I do not think this will happen. If Rosneft, Gazprom or LUKOIL are to impose sanctions like those that happened with Rusal, you will actually turn off the energy systems of Europe, and this is a little too much, ”said Dudley, speaking at the Oil & Money conference in London. 2018 (quoted by Sputnik News).

Since 2013, BP is the largest private shareholder of Rosneft with a 19.75% stake, and also develops joint projects: in 2015, BP bought 20% in the Srednebotuobinsky field in Eastern Siberia, is engaged in exploration in a joint venture with Rosneft "Yermak Neftegaz. Since 2013, Rosneft has paid out over 100 billion rubles to BP. dividend, the share in the Russian company provides a third of the production of BP, follows from the reports of both companies. Dudley has repeatedly said that the company is satisfied with the volume of its investments in Rosneft and is not going to change the size of the package. "In general, we consider Rosneft a very good partner of BP," he said in an interview with Bloomberg.

Representatives of Gazprom and Rosneft declined to comment. Earlier, in an interview with Vedomosti, the co-owner of LUKOIL, Vagit Alekperov, expressed the hope that “the company will be able to overcome the difficulties that may arise after November 2018 [when new US sanctions may be introduced]”. According to Alekperov, LUKOIL plans to solve problems "as they become available."

In November, a package of extremely tough US sanctions may come into force, similar to the measures imposed against UC Rusal by Oleg Deripaska in April. The United States Congress simultaneously introduced two bills on sanctions, known as “Protecting Elections from Threats by Designating Red Lines” (DETER) and “Act on Protecting American Security from Kremlin Aggression” (DASKAA). In accordance with DETER, in the event of Russia's attempts to influence the course of elections in the US, the White House should block the funds of the largest Russian banks (Sberbank, VTB, Vnesheconombank, etc.) and energy companies (Gazprom, Rosneft, LUKOIL, etc.) and also prohibit Americans from buying Russian debt. DASKAA also provides for the introduction of sanctions against Russian banks and energy companies.

In April, the United States imposed unprecedented tough sanctions against 24 people and 14 companies, including Deripaska’s international assets (UC Rusal and En +) and Viktor Vekselberg: they were added to the SDN list, which presumes complete isolation from the US financial system, and the law CAATSA gives the US the right to impose secondary sanctions on their partners, which makes Russian companies toxic.

In late August, the US authorities imposed sanctions against Russia related to the poisoning in Britain of the former GRU officer Sergei Skripal. The restrictions prohibit the sale of weapons and any US defense products to Russia. According to this document, Washington has stopped issuing licenses for the export of American weapons to Russian state-owned companies.

Dudley's statement is not the first example of criticism of sanctions against Russia by representatives of the Western business environment. In August, the Eastern Committee of the German economy warned about the negative consequences of measures being prepared in the United States against Moscow. As the managing director of the organization, Michael Harms, stressed then, business in the European Union should not suffer because of cooperation with Russia. In March 2018, the committee presented data indicating that Western sanctions or counter sanctions had a negative impact on the work of more than 70% of German companies. At the same time, 94% of companies would like to weaken the existing sanctions regime, the organization pointed out, stressing that it is in favor of consistently lifting restrictions from Moscow as the Minsk agreements on Ukraine are implemented. The East Committee of the German Economy represents the interests of 350 German companies and associations in the markets of Russia, Belarus, Ukraine, Central Asia, the Caucasus and South-Eastern Europe.

In early October, the head of Total (owns 19.4% of NOVATEK and 20% of Yamal LNG) declared the futility of the EU sanctions policy, Patrick Puianne. “I think the sanctions are ineffective. Their effect leads to the fact that leaders unite people around themselves, and do not change their own policies, ”he said in an interview with Capital.

“The business of most European countries - [Italy], the Czech Republic, France, Germany, Spain - believes that there should be no sanctions, they should be removed as soon as possible. Someone thinks that this should happen gradually, but business thinks differently, ”Ernest Ferlenghi, president of the Italian business association in Confindustria Russia, told Interfax earlier. “Every lost day is an opportunity for our competitors, especially Asian countries. They have great opportunities, especially the Chinese, for investing money in various projects.