Belarus preparing to send soldiers, report says: Ukraine update

As soon as Monday to help its ally Moscow, the Washington Post reported, citing an unnamed US official. 
Image: Sergei Supinsky/AFP/Getty Images

Officials from Kyiv plan to meet Russian counterparts, hours after President Vladimir Putin put his country’s nuclear forces on higher alert. Belarus was preparing to send troops into Ukraine as soon as Monday to help its ally Moscow, the Washington Post reported, citing an unnamed US official.

Ukrainian President Volodymyr Zelenskiy voiced skepticism that talks planned with Russia for near the Belarus border would yield results but said he was willing to try if it meant any chance of peace. US citizens were advised to consider leaving Russia immediately.

The US and its European allies stepped up their response to the escalating conflict, announcing plans to sanction the central bank in Moscow and cut off various Russian lenders from the critical SWIFT financial messaging system. The offshore Russian ruble fell nearly 30% against the dollar and US President Joe Biden planned to speak with allies on the crisis Monday morning in Washington.

Key Developments

  • EU Weighs Sanctions on Some of Russia’s Wealthiest Tycoons
  • Putin Races Against Clock as Fast Military Advance ‘Frustrated’
  • SWIFT Ban Means the Fed May Need to Be Ready With Dollars
  • Traders Brace After Russia Sanctions Stepped Up, Ratings Cut
  • Hackers Destroyed Data at Key Ukraine Agency Before Invasion
  • Germany to Lift Defense Spending in Latest Historic Policy Shift
  • Russians Rush for Dollars as Sanctions Threaten Ruble Collapse

Belarus Preps to Send Troops to Ukraine, Report Says (3:57 a.m)

Belarus is preparing to send soldiers into Ukraine in support of Russia as soon as Monday, the Washington Post reported, citing comments from an unidentified US official.

Offshore Russian Ruble Slides by Almost 30% on Sanctions (3:32 a.m.)

The ruble fell by nearly 30% against the dollar in offshore trading on Monday, as Western nations agreed to penalise Russia’s central bank and exclude some Russian banks from the SWIFT messaging system.

Japan Says Speed Needed for SWIFT Measures (3:01 a.m.)

Speed is important in implementing the decision to block targeted Russian banks from the SWIFT messaging system, Japanese Prime Minister Fumio Kishida told parliament, adding he wanted to act quickly to freeze the assets of Putin and other Russian officials.

Kishida announced Sunday night Japan would join the SWIFT measure, a move the premier said came after requests from the US and European countries. Kishida also criticised Russia’s comments on nuclear deterrence as “extremely dangerous.” Foreign Minister Yoshimasa Hayashi told the same committee that Japan was considering sanctions against individuals in Belarus.

Bolsonaro Says Brazil Backs Neutral Stance (2:53 a.m.)

President Jair Bolsonaro said Brazil’s position on Ukraine must be one of “caution” and “balance,” adding that he doesn’t want to bring negative consequences to his country. He backed an even-handed approach, setting himself apart from other leaders and his own country’s diplomats in the United Nations who have condemned Russia’s actions.

US Futures Sink, Oil Up as West Isolates Russia (1:42 a.m.)

US equity futures slid Monday while bonds and crude oil surged amid heightened market uncertainty after Western nations unveiled harsher sanctions on Russia for the invasion of Ukraine.

Rallies in a dollar gauge, gold and Treasuries underlined the demand for havens. The euro fell on worries about risks for Europe’s economy. An Asia-Pacific equity index wavered as Japanese stocks fluctuated. Cryptocurrency Bitcoin held losses after retreating below $38 000.

Japanese Worry About Ukraine Leading to Taiwan Attack (12:28 a.m.)

More than three quarters of Japanese are concerned that if the international community can’t stop Russia’s invasion of Ukraine, China could be emboldened to attack Taiwan, according to a poll carried out by the Nikkei newspaper from Friday through Sunday.

The survey was published after Prime Minister Fumio Kishida announced Japan was joining the US and the EU in blocking some Russian banks from the SWIFT system and freezing assets held by some Russian officials. Japanese officials have said they see Taiwan as directly linked to Japan’s security.

Brent Oil Jumps 6% as Russia Sanctions Intensify (12:09 a.m.)

Brent crude soared past $104 a barrel after Western nations unleashed more sanctions to isolate Russia, one of the world’s top producers of oil, gas, metals and agricultural products.

Futures in London jumped as much as 6.5% in early Asian trade on Monday.

EU Proposes Sanctions on Russian Tycoons (9:21 p.m.)

The European Union is discussing sanctioning some of Russia’s wealthiest tycoons as well as top officials in state companies and media, according to documents seen by Bloomberg.

The list, which still needs to be approved by European governments and could change before that happens, includes a handful of billionaires who haven’t yet been hit by sanctions in the US: metals tycoon Alisher Usmanov, Alfa Group owners Mikhail Fridman and Petr Aven, plus Alexei Mordashov, who controls a major steel company.

Vladimir Putin’s longtime spokesman Dmitry Peskov is also on the list that’s under consideration.

UN to Hold Emergency Session on Ukraine (9:15 p.m.)

The United Nations Security Council voted to hold an emergency session of the General Assembly Monday in further protest of Russia’s invasion of Ukraine.

It will be the first time in decades that the General Assembly has held such a meeting, and it’s aimed at showing global condemnation of the invasion. The vote to hold the meeting 11-1 with three abstentions. Russia voted against it but couldn’t invoke its veto power because the question was procedural.

“The council members who supported this resolution recognise that this is no ordinary moment,” US Ambassador Linda Thomas-Greenfield said at Sunday’s Security Council meeting.

US Says Citizens Should Consider Departing Immediately (9 p.m.)

The US Embassy in Russia said citizens in the country should consider departing immediately due to the decreasing availability of commercial flights.

“An increasing number of airlines are canceling flights into and out of Russia, and numerous countries have closed their airspace to Russian airlines,” the embassy said in a security alert. “US citizens should consider departing Russia immediately via commercial options still available.”

The European Union announced Sunday that it would close its airspace to Russia in an attempt to further isolate Putin. The US State Department has since January 23 advised citizens not to travel to Russia.

EU Approves $500 Million in Lethal Military Aid (8:51 p.m.)

Foreign ministers agreed to send 450 million euros ($500 million) in military aid to Ukraine for lethal weapons, according to Josep Borrell, the bloc’s foreign policy chief.

The aid will be financed by the EU’s European Peace Facility and will see the bloc supply arms to a country at war for the first time in its history. Another 50 million euros will be provided for non-lethal purposes, Borrell said.

Member states that don’t want to be associated with contributing lethal weapons will be able to abstain or make a parallel contribution of non-lethal aid

EU Bans All Transactions With Russian Central Bank (7:52 p.m.)

EU foreign ministers endorsed a plan to ban all transactions involving Russia’s central bank, in a move designed to deal a severe blow to the country’s financial system.

The agreement paves the way for the measure to come into force as soon as Sunday and will prevent Moscow from tapping some currency reserves held outside Russia.

The EU has also joined an international agreement to mostly shut Russia out of SWIFT, the messaging system used for trillions of dollars in transactions around the world.

Norway Moves to Drop Russia From Sovereign Wealth Fund (7:21 p.m.)

Norway has decided to start the process to remove Russian assets from its $1.3 trillion sovereign wealth fund, Prime Minister Jonas Gahr Store told reporters in Oslo on Sunday.

The government decided to freeze Russian holdings in the wealth fund in response to Russia’s actions in the Ukraine, the prime minister said. The fund held $3.3 billion in shares and bonds in the country at the end of 2020.

Norway’s krone dropped more than 1% after the announcement.

Russian Agencies Scoff at EU Vow to Ban Access (7:15 p.m.)

RT Editor in Chief Margarita Simonyan hit back after European Commission President Ursula von der Leyen announced that the news outlet, as well as other Russian state-backed media, would be banned from operating in the union.

Simonyan wrote on Twitter that the agency had no plans to lay off any employees in Europe: “We know how to do our job in the conditions of prohibitions. These freedom-loving people have been preparing us for this for eight years.

Russia’s Sputnik agency scoffed in its news report as well. “We advise the European Union to not stop at half measures and just ban the Internet outright,” it said.

SocGen Halts Commodity Trade Finance Deals (6:56 p.m.)

Societe Generale and Credit Suisse, key financiers to commodity trade houses, are no longer providing the money needed to move raw materials such as metals and oil from Russia, according to people familiar with the matter.

Dutch banking giants ING Groep NV and Rabobank are restricting lending to deals involving movement of commodities from Russia and Ukraine, and Chinese banks are also pulling back.

BP to Exit 20% Shareholding in Russian Oil Producer Rosneft (6:20 p.m.)

British oil company BP Plc will exit its shareholding in Rosneft and take a $25 billion charge, a dramatic reversal after Russia’s invasion of Ukraine. BP has come under pressure from the UK government over its stake in the Russian oil major.

Ukraine Reports Damage to Two Nuclear Facilities (6:08 p.m.)

Two Ukrainian facilities containing nuclear waste have suffered damage in Russia’s attack on the country, international monitors reported. Missiles hit a radioactive waste-disposal site in Kyiv, and an electrical transformer was damaged in a similar depot in Kharkiv, the International Atomic Energy Agency said in a statement. Inspectors are still awaiting radiation measurements from local authorities to determine the extent of the damage.

“These two incidents highlight the very real risk that facilities with radioactive material will suffer damage during the conflict, with potentially severe consequences for human health and the environment,” IAEA Director General Rafael Mariano Grossi said.

G-7 Finance Chiefs Will Meet on Tuesday (6 p.m.)

Group of Seven finance ministers and central-bank heads will hold talks on Tuesday with humanitarian aid for Ukraine likely to be a topic, World Bank President David Malpass said.

“They can decide a lot of how much aid goes into Ukraine,” he said on CBS’s “Face the Nation.”

EU Bans Sputnik and RT in Clampdown on Russian State Media (5:45 p.m.)

The EU is banning Russia’s state-owned media Sputnik and Russia Today as it pushes back against what European Commission President Ursula von der Leyen described as Putin’s propaganda operations. There were no immediate specifics on what that ban would entail in terms of operations in the EU or broadcasting. Von der Leyen said the EU is developing tools to help it enforce the ban.

Zelenskiy Says Skeptical About Talks, But Worth a Try (5:35 p.m.)

“I do not believe much in the result of this meeting — but let them try so that not a single Ukrainian citizen has doubts that I as president did not try to stop the war when there was a chance, albeit little,” the president said on Telegram.

Finance Minister Serhiy Marchenko separately announced a decision to issue war bonds, with an initial auction planned “soon.” The minister said the securities will be marketed to international investors, without specifying the volume.

US Says Russia May Commit More Forces (5:20 p.m.)

Russia’s military has deployed about two-thirds of its forces arrayed around Ukraine to the conflict so far, a senior US defense official told reporters.

The official said Russia’s advance has been slowed by Ukrainian resistance plus difficulties with fuel supplies. But Russia is likely to adapt and could overcome those challenges, in part by sending more troops in, the official said.

Turkey Inches Toward Decision on Russia Warship Transits (5:10 p.m.)

Foreign Minister Mevlut Cavusoglu said Turkey has decided the fighting in Ukraine amounts to an act of war, a key legal threshold for the country to decide whether warship transits through the Turkish straits can be regulated under the Montreux Convention.

Berlin Pro-Ukraine Demonstration Draws 100,000 (5:02 p.m.)

About 100 000 people streamed through the Brandenburg Gate to the central Tiergarten park Sunday for a demonstration in support of Ukraine, according to police estimates. Authorities had expected as many as 20 000. Many demonstrators waved Ukrainian flags and banners calling on Putin to stop the war.

IMF Ready to Provide $1.4 Billion to Ukraine (4:41 p.m.)

The International Monetary Fund is ready to provide Ukraine with $1.4 billion under its so-called Rapid Financing Instrument, said central bank governor Kyrylo Shevchenko. The disbursement will have to be approved by the IMF board.

Pentagon Calls Putin’s Nuclear Posture an ‘Escalatory’ Step (4:19 p.m.)

Putin’s move to put Russia’s strategic nuclear forces on higher alert is an “escalatory” step that increases the risk of a miscalculation, the Pentagon said.

The comment, during a briefing by a senior US defense official, came after Putin on Sunday cited what he called “aggressive” statements from the leaders of NATO countries. The official declined to say whether the US had changed its nuclear readiness posture in response to the Russian move.

Russian Energy Sanctions Are Possible, US Says (4:10 p.m.)

The US is keeping energy sanctions against Russia “on the table,” though any measures would have to avoid disrupting markets and pain for US consumers, White House Press Secretary Jen Psaki said.

“We want to take every step to maximise the impact and the consequences on President Putin, while minimising the impact on the American people and the global community,” Psaki said on ABC’s “This Week” on Sunday.

Senator Tom Cotton, an Arkansas Republican, called on President Joe Biden to sanction Russian oil and gas exports.

EU to Propose Granting Rights to Ukraine Refugees (4:06 p.m.)

In an emergency meeting Sunday, EU home affairs ministers will discuss extending temporary rights to Ukrainian refugees, with several countries pushing for the immediate adoption of the measure.

Several ministers arriving for talks in Brussels said they backed triggering for the first time the 2001 Temporary Protection Directive, which applies to displaced people from non-EU countries and grants them rights, including a residence permit valid for between one and three years and access to employment and to accommodation.

So far more than 300 000 people have fled into the EU from Ukraine and the European Commission has warned that the number could grow into the millions.

Russians Rush for Dollars After SWIFT Ban (3:09 p.m.)

Russians lined up at cash machines around the country to withdraw foreign currency as new sanctions to punish the Kremlin for its invasion of Ukraine sparked fear the ruble could collapse.

The rush came despite some lenders selling dollars at more than a third higher than the market’s close on Friday, and well past the psychologically important level of 100 rubles per dollar that many economists said would trigger an interest-rate hike by the Bank of Russia.

Russia last faced a major run on cash in 2014, when plunging oil prices in the wake of Western sanctions related to the annexation of Crimea triggered a crash in the exchange rate.

Bank of Russia Eases Limits on Open FX Positions (2:49 p.m.) 

Russia’s central bank eased its restrictions on banks’ open foreign-currency positions until July 1, adding to its earlier measures to stabilise the financial system, according to a statement on its website.

The regulator will monitor positions but won’t punish lenders for exceeding the set limits as long as the foreign currency and precious metals positions aren’t used for “speculative purposes.”

Ukraine Agrees to Talks With Russia at Belarusian Border (2:46 p.m)

Ukraine has agreed to talks with Russia on the Belarusian-Ukrainian border, President Volodymyr Zelenskiy said in a Facebook post. A delegation has already left Kyiv for the undisclosed location.

“We have agreed that the Ukrainian delegation will meet with Russian without prior conditions on the Ukrainian-Belarusian border, in the area of the Pripyat River,” Zelenskiy said.

Putin Puts Nuclear Forces on Higher Alert on Tensions (2:12 p.m.)

Putin ordered Russia’s strategic nuclear forces put on higher alert, citing what he called “aggressive” statements from the leaders of NATO countries.

Putin made the comments Sunday at a meeting with his defense minister and military chief, in which he also called newly imposed Western sanctions illegitimate.

Russia conducted exercises involving its nuclear forces earlier this month as tensions built, including test launches of missiles. Confusion continued Sunday about whether Ukraine would agree to peace talks in Belarus, which has been a staging post for Russian attacks.

More Than 300,000 Have Fled Into EU, Border States Say (2:20 p.m.)

Well more than 300,000 people fleeing Russia’s invasion of Ukraine have crossed into the European Union since fighting began on Thursday, according to the four EU member states bordering Ukraine.

Poland has registered almost 200,000 people in total since February 24, the nation’s border agency said. Hungary counted 66,000 in total, the Foreign Ministry said, while Slovak authorities put the number there at between 15 000 and 20 000. Romania gave a figure of 43 000 who entered the country, though limited the figure to Ukrainian citizens.

EU officials had forecast more than a million refugees in the event of war in Ukraine, while United Nations agencies last week now see as many as 4 million if the invasion continues.

Japan Joins US, EU in Imposing SWIFT Restrictions (1:18 p.m.)

Japan will join Western nations in excluding some Russian banks from the SWIFT messaging system, Prime Minister Fumio Kishida said Sunday. The country will also freeze assets held by some Russian government officials including Putin, Kishida said.

EU Seeks to Approve SWIFT, Central Bank Sanctions Sunday (12:45 p.m.)

The EU will seek to adopt its new sanctions excluding certain Russian banks from the SWIFT messaging system and penalising Russia’s central bank on Sunday, before markets open Monday, according to officials familiar with the plan.

European ministers will try to adopt the package by emergency procedure on Sunday, according to the officials, who asked not to be identified because the process is private. There will also be discussions on extending the SWIFT ban to Belarusian banks.

Russian Forces Attack Ukraine’s Second City (11:35 a.m.)

Russian forces have attacked Kharkiv, Ukraine’s second-largest city, after a new round of sanctions was announced to punish the Kremlin over its invasion.

Troops are defending the city of 1.8 million, according to Ukrainian military authorities, who provided images of destroyed Russian vehicles in the city’s streets.

© 2022 Bloomberg

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