Russian Invasion of Ukraine (2022)

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No Sting, No Mercedes: A Russian Expo Shows Cost of Divorce With the West

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The annual economic forum in St. Petersburg used to host multibillion-dollar deals and performances by global music stars. With the war in Ukraine still raging, the mood has shifted.During his early years in the Kremlin, President Vladimir V. Putin used the annual economic conference in St. Petersburg as a marquee event to showcase how Russia was becoming a magnet for Western businesses.Multibillion-dollar oil and gas deals were signed, including the agreement to build the Nord Stream 2 pipeline between Russia and Germany. Western corporate giants such as BP, Chevron, Deutsche Bank and Total sent their chief executives. In 2018, President Emmanuel Macron of France was the guest of honor. In 2011, Sting performed in front of the Winter Palace.But the event, which opened on Wednesday and will run through Saturday, now reflects a Russia fundamentally transformed by Mr. Putin’s invasion of Ukraine in 2022.The Kingdom of Bahrain was the guest of honor, and the Chinese brand Tank, not Mercedes, was selected as the official car. Instead of executives from Morgan Stanley and Citibank, a delegation of the Taliban roamed the giant exhibition center. And only second-tier Russian pop and rock stars were on show, with no international acts appearing at all.Tank, a Chinese automobile manufacturer, was chosen as the carmaker for the conference. In prior years, it was Mercedes.Dmitri Lovetsky/Associated PressThe conference’s message is that Russia will never again be so reliant on business with the West.Despite newly opened lines of communication between Mr. Putin and President Trump, major American investors once again shunned the conference. The Russia-United States session, billed as dedicated to “identifying shared interests and shaping long-term partnerships,” was open by invitation only.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    As Trump Returns to G7, Rift With Allies Is Even Deeper

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    In 2018, the president called for the group to embrace Russia and stormed out of the summit. Now he is seeking to shrink America’s military role abroad and embarking on a more expansive trade war.When President Trump last attended a Group of 7 meeting in Canada, he was in many ways the odd man out.At that meeting, in 2018, Mr. Trump called for the alliance of Western countries to embrace Russia, antagonized allies and ultimately stormed out of the summit over a trade battle he began by imposing metals tariffs on Canada.As he returns on Sunday for the Group of 7 meeting in Alberta, those fissures have only deepened. Since retaking office, the president has sought to shrink America’s military role abroad and made threats to annex the summit’s host after embarking on a much more expansive trade war.Mr. Trump is now facing a self-imposed deadline of early July to reach trade deals. His trade adviser even promised in April that the tariffs would lead to “90 deals in 90 days.” Despite reaching framework agreements with Britain and China, the administration has shown scant progress on deals with other major trading partners.The future of the president’s favored negotiating tool is uncertain as a legal battle over his tariffs plays out in the courts. But a failure to reach accords could lead the Trump administration to once again ratchet up tariffs and send markets roiling.“I think we’ll have a few new trade deals,” Mr. Trump told reporters at the White House on Sunday as he left for the summit.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    European Union Unveils Fresh Sanctions on Russia, Including a Nord Stream Ban

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    Ursula von der Leyen, president of the European Commission, announced a proposal meant to ramp up pressure on Moscow.The European Union’s executive arm unveiled its latest package of sanctions against Russia, aiming to apply pressure to President Vladimir V. Putin by damaging the nation’s energy and banking sectors.The sanctions proposed on Tuesday — which still need to be debated and passed by member states — would ban transactions with the Nord Stream pipelines, hoping to choke off future flows of energy from Russia into Europe.They would lower the price cap at which Russian gas can be purchased on global markets, hoping to chip away at Russian revenues.And they would hit both Russian banks and the so-called “shadow fleet,” old tanker ships, often registered to other countries or not registered at all, that Moscow uses to covertly transport and sell its oil around the world to skirt energy sanctions. The new measures would blacklist a new batch of ships that are being used in this way.The proposal is the 18th sanctions package to come out of Brussels since Russia’s full-scale invasion of Ukraine. Taken as a whole, the measures are a sweeping effort to threaten Russian economic might and morale at a critical juncture in the war.The announcement comes as peace talks between Russia and Ukraine stall. Despite pressure from the Trump administration to work toward a cease-fire, the latest round of talks between the two sides, earlier this month in Istanbul, created little result outside of another agreement to swap prisoners.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Oil Prices Are Falling. Here’s Where That Could Spell Trouble.

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    For countries that depend heavily on oil revenue, dropping prices are worrisome.Oil producing countries are bracing for a bumpy ride this year, with a precipitous drop in prices to the lowest levels in four years seen as the initial, alarming sign of looming turmoil.A price drop benefits any country seeking to cut its fuel bill. But in oil producing nations, lower prices can feed economic troubles, and sometimes political unrest, as governments slash spending.Analysts who had already been predicting lower oil prices because of softening demand amid increased global production said the possibility of a tariff trade war and the overall climate of uncertainty could well deepen producers’ woes.“The steep price dive and overall volatility is sending a very strong signal that the global economy is going to be rattled this year and that will translate into a lower demand for oil,” said Gregory Brew, a specialist on the geopolitics of oil and gas with the Eurasia Group, a New York-based risk analysis organization.Wealthy producers may be able to cushion the blowEarlier this year, the price for benchmark crude held steady around $73 a barrel, high enough to sustain the budgets of most producing nations. But some countries, like Saudi Arabia and the United Arab Emirates, base ambitious development plans on a price of at least $90 a barrel, analysts say.A huge, futuristic city project in Saudi Arabia is being financed with oil revenue.Planet Labs Pbc/Planet Labs PBC, via Associated PressWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Debate Over U.S. Sanctions on Russia For Ukraine War Intensifies

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    The president-elect has said he will use sanctions sparingly while vowing to end the war in Ukraine, renewing questions over their efficacy.Thousands of far-reaching sanctions have been imposed by dozens of countries on Russian banks, businesses and people since Moscow ordered tanks to roll across the border into Ukraine in the winter of 2022.Now, more than 1,000 days later, as President-elect Donald J. Trump prepares to take office, questions about the sanctions’ effectiveness — and future — are expected to come under renewed scrutiny.Mr. Trump has stated, “I want to use sanctions as little as possible.” And he has made clear that there will be a shift in American policy toward Ukraine, having promised to end the war in a single day.Experts believe that sanctions and continued military aid are almost certain to be bargaining chips in any negotiations.So how valuable are the sanction chips that Mr. Trump will hold?The answer is hotly debated.Predictions in the early months of the war that economic restrictions would soon undermine President Vladimir V. Putin’s regime or reduce the ruble to “rubble” did not pan out. Mr. Putin remains entrenched in the Kremlin, and his forces are inflicting punishing damage on Ukraine and gaining on the battlefield.Yet the idea that economic sanctions could bring a quick end to the war was always more a product of hope than a realistic assessment, said Sergei Guriev, a Russian economist who fled the country in 2013 and is now the dean of the London Business School.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Russia Raises Interest Rate to 21 Percent, Its Highest in Decades

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    Military spending and recruitment are causing the country’s economy to overheat, leaving regulators in a struggle to rein in rising prices.Russia’s central bank raised the cost of borrowing in the country to its highest level in more than two decades on Friday in an effort to slow inflation that is being fueled by record military spending and recruitment.The central bank raised Russia’s benchmark interest rate to 21 percent during its regular monetary policy meeting. That makes borrowing in the country even more expensive than at the start of Russia’s invasion of Ukraine in February 2022, when the central bank sharply increased interest rates to calm the economy. The effective cost of borrowing in Russia is now the highest since 2003.It was the third increase in a row, and Elvira Nabiullina, the central bank’s president, said that interest rates could rise further later this year.“We don’t see inflationary pressures slowing down,” Ms. Nabiullina, who maintains some policy independence from the Kremlin, told reporters after announcing the new rate.The increase underscores the challenges that Ms. Nabiullina faces as she tries to cool inflation, which she forecasts will average 8.8 percent this year. At that level, prices are rising more than twice as quickly as the central bank considers healthy for the Russian economy.Ms. Nabiullina implicitly blamed Russia’s war in Ukraine for the continued price increases. She said the Kremlin’s decision to raise spending by $15.5 billion next year, mostly to cover war-related costs, was overheating the economy and feeding inflation.In particular, she said, high government spending blunts the central bank’s main tool for controlling inflation — setting interest rates. This is because companies that receive military contracts are willing to take out loans at any cost to meet production deadlines.Labor shortages resulting from military recruitment during the war have also fueled inflation.The war has left hundreds of thousands of Russian men dead or seriously injured, according to Western intelligence agencies. Hundreds of thousands more have left the country to avoid being called up. And hundreds of thousands of others have joined the army to benefit from ever-rising payouts, leaving the civilian economy deprived of workers.“Spare hands no longer exist in the economy,” Ms. Nabiullina said, which leaves companies competing for workers by offering them higher wages.In turn, those rising wages spur consumer spending, further contributing to inflation.Military spending has caused a boom in the Russian economy: The International Monetary Fund said this week that Russia’s economy would grow 3.6 percent this year, 0.4 percentage points higher than its previous forecast. But economists say that the situation is breaking the balance between supply and demand, with potential long-term consequences for the country’s financial stability.Yet the Kremlin is showing no signs of letting up on war spending.“Our main priority are the goals of the special military operation,” Finance Minister Anton Siluanov told RBC, a business newspaper, this week, referring to the war in Ukraine. “We will spend as much money as we need on the battlefield, on the victory.”Oleg Matsnev More

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    G7 Finalizes $50 Billion Ukraine Loan Backed by Russian Assets

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    The economic lifeline is expected to be disbursed by the end of the year.The Group of 7 nations finalized a plan to give Ukraine a $50 billion loan using Russia’s frozen central bank assets, Biden administration officials said on Wednesday.The loan represents an extraordinary maneuver by Western nations to essentially force Russia to pay for the damage it is inflicting on Ukraine through a war that shows no sign of ending.“These loans will support the people of Ukraine as they defend and rebuild their country,” President Biden said in a statement. “And our efforts make it clear: Tyrants will be responsible for the damages they cause.”The announcement comes after months of debate and negotiation among policymakers in the United States and Europe over how they could use $300 billion of frozen Russian central bank assets to support Ukraine.The United States and the European Union enacted sanctions to freeze Russia’s central bank assets, most of which are held in Europe, after its invasion of Ukraine in early 2022. As the war dragged on, officials in the United States pushed for the funds to be seized and given directly to Ukraine to aid in its economic recovery.European officials had concerns about the lawfulness of such a move, however, and both sides eventually agreed over the summer that they would use the interest that the assets were earning to back a $50 billion loan.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Russian Oil Flows Through Western ‘Price Cap’ as Shadow Fleet Grows

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    A report shows how Russia has largely evaded sanctions aimed at limiting its revenue from oil sales.A plan hatched by wealthy Western nations to deprive Russia of oil revenue is largely faltering, a new report found, with the majority of the Kremlin’s seaborne oil exports evading restrictions that were supposed to limit the price of Russian crude.Almost two years since an oil “price cap” was enacted, nearly 70 percent of the Kremlin’s oil is being transported on “shadow tankers” that are evading the restrictions, according to an analysis published by the Kyiv School of Economics Institute, a Ukraine-based think tank.Russia’s success at circumventing the sanctions imposed by the Group of 7 nations has allowed it to continue to finance its war against Ukraine. The effectiveness of the price cap has been marred by loose enforcement of the policy. Officials in the United States and Europe have tried to balance their goals of crippling Russia’s economy while keeping oil markets well supplied to prevent price spikes.The challenges underscore the limitations that the world’s advanced economies have been facing as they attempt to intervene in global energy markets to try to hasten an end to Russia’s invasion of Ukraine.The Kyiv School of Economics Institute, which has argued for tougher sanctions on Russian oil, noted in its report that Russia’s shadow fleet poses a threat to the world’s oceans because the tankers are often poorly maintained and not properly insured.“There have been several instances of shadow tankers being involved in collisions or coming close to running aground in recent months,” the report said. “Large oil spills have so far been avoided but a major disaster is waiting to happen and cleanup costs would reach billions.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    U.S. Tightens Technology Controls to Target Russian War Machine

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    The Biden administration announced new penalties on shell companies and suppliers that were feeding Russia’s war against Ukraine.The Biden administration said on Friday that it would add more than 100 companies and organizations in Russia, China and several other countries to a restricted trade list and take other measures, as it widens its net to try to capture more advanced technology that is flowing to the Russian military.The new rules aim to disrupt the procurement networks that are funneling semiconductors and other technology to Russian forces, who then use them to wage war against Ukraine. They will give the U.S. government expanded authority to prevent products made with U.S. technology from being shipped to Russia, even if those products are manufactured in countries outside of the United States.The penalties also included the addition of 123 entities in Russia, Crimea, China, Turkey, Iran and Cyprus to a so-called entity list. Suppliers are barred from sending companies on the entity list certain products without first obtaining a government license.The government also added certain addresses in Hong Kong and Turkey to the list that were known to set up shell companies, meaning any further shell companies registered to those addresses would face trade restrictions.The entity list additions include several uncovered in a recent investigation by The New York Times, including an office at 135 Bonham Strand in Hong Kong’s financial district that specialized in setting up shell companies. The office was the place of registration for at least four companies that funneled millions of restricted chips and sensors to military technology companies in Russia, the investigation found.The additions bring the number of organizations that the Biden administration has added to the entity list in relation to Russia’s war in Ukraine to more than 1,000.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More