Ukraine latest: Lavrov says Russia moving away from dollar usage

The central bank in Moscow slashed interest rates and forecast sanctions would trigger a bigger economic drop than expected before the war.
Image: Alexander Nemenov/AFP/Getty Images

Russia  is seeking to move away from the US dollar and rely less on imports while strengthening its independence in key technologies in response to sanctions over the war with Ukraine, Foreign Minister Sergei Lavrov told China’s Xinhua news agency.

The Pentagon’s chief spokesman, in an emotional moment, called Russian aggression in Ukraine “just brutality of the coldest and most depraved sort.”

The Biden administration is seeking to lure Russian scientists and engineers by waiving visa rules, according to people familiar with the matter.

The central bank in Moscow slashed interest rates and forecast sanctions would trigger a bigger economic drop than expected before the war, while Germany signaled it wouldn’t oppose a European Union embargo on Russian oil.

Key Developments

  • Biden Seeks to Rob Putin of His Top Scientists With Visa Lure
  • Putin’s Gas-for-Rubles Gambit Hits EU Fault Lines as Stakes Rise
  • Alarmed by Russia’s Aggression, Europe Rethinks Its China Ties
  • Russia Uses Domestic Dollar Stash to Avoid Defaulting on Bonds
  • Russia Surprises With Bigger Rate Cut and Warns on Downturn

Russia to Move Away from U.S. Dollar, Xinhua Says (3 a.m.)

Russia is seeking to move away from the US dollar and rely less on imports while strengthening its independence in key technologies in response to sanctions over the war with Ukraine, Lavrov said in an interview with China’s Xinhua news agency. Russia’s central bank said earlier this month it found no clear alternatives to the world’s major reserve currencies after sanctions left it in possession of only yuan and gold.

Negotiations between Russia and Ukraine are taking place daily via video conferences, as delegations of the two countries work toward a draft of possible agreements, Lavrov said, adding that Chinese diplomats are briefed on the discussions.

“We are in favour of continuing the negotiations, although progress hasn’t been easy,” Xinhua quoted him as saying.

US Plans Visa Waivers for Russia’s Science Stars (11:49 p.m.)

The Biden administration has a plan to rob Vladimir Putin of some of his best innovators by waiving visa requirements for highly educated Russians, according to people familiar with the strategy.

One proposal, which the White House included in its latest supplemental request to Congress, is to drop the rule that Russian professionals applying for an employment-based visa must have a current employer. It would apply to Russian citizens who have earned master’s or doctoral degrees in science, technology, engineering or mathematics in the US or abroad. Key targets include Russians with experience in semiconductors and cybersecurity, among other fields.

Ukraine Says Russia Sent Team to Nuclear Plant (10:45 p.m.)

Ukraine told the International Atomic Energy Agency that Russia sent a team of specialists to the Zaporizhzhya nuclear power plant, which is controlled by Russian forces but still operated by its Ukrainian staff, according to the IAEA website.

The officials from Russia’s state nuclear company Rosatom are demanding daily reports about “confidential issues” related to the plant’s operations and management, the IAEA said, citing what it’s been told by the Kyiv  government. The IAEA’s director general said the situation at the plant “continues to be challenging and requires continued attention.”

Pentagon’s Spokesman Denounces Putin for ‘Depravity’ (8:50 p.m.)

US Defense Department spokesman John Kirby denounced Putin for the “depravity” of Russia’s tactics in Ukraine and the “bizarre” claims he has made about his reasons for waging war there.

“There’s not even an attempt by Russia to be precise in their targeting,” Kirby told reporters, pausing at times in delivering what he acknowledged was an unusually emotional broadside. “It’s just brutality of the coldest and most depraved sort.”

The Pentagon spokesman also told reporters that Ukrainians are being trained on using US-supplied weapons at three locations outside their country, including Germany, and that the “bulk of the training” was being done by members of the Florida National Guard who were withdrawn from Ukraine shortly before the invasion.

Russia Clarifies Gas-For-Rubles Rules Amid Sanctions Worries (8:41 p.m.)

Russia clarified the rules on how European customers are required to pay for natural gas supplies in rubles, easing the terms slightly as concerns grow the mechanism could force companies to violate European Union sanctions if they want to keep the fuel flowing.

Putin last month demanded buyers switch to paying in rubles, threatening to cut off supplies to countries that don’t. But the EU said the process Russia set up for making the payments, which requires customers to open both foreign-currency and ruble accounts with state-controlled Gazprombank, was in breach of sanctions on the central bank.

Ukraine Economy Minister Calls Fuel Shortage Temporary (6:35 p.m.)

Ukraine’s government will be able to restore fuel supplies within a week after Russian strikes on an oil refinery and storage facilities, Economy Minister Yulia Svyrydenko said.

Her comments came amid growing concern among Ukrainians that buying fuel will become even more difficult, at least in cities such as the capital Kyiv, where demand is rising as people return to their homes after Russian troops pulled back. Long lines of cars at filling stations have become a common occurrence. “Within the next seven days a deficit will be eliminated, as operators have the contracts signed in Western Europe,” she said. “And now we are solving an issue of transportation to Ukraine.”

Separately, Yuriy Vitrenko, chief executive officer of Ukraine’s state-run energy company Naftogaz, told Bloomberg Television that he expects Russian gas flows to Europe to continue.

Moldova Working to Prevent Insecurity Spilling Over (4:35 p.m.)

“Moldova is not about to become an immediate or imminent target for hostile military action,” Foreign Minister Nicu Popescu told Bloomberg TV, after a series of explosions across the pro-Kremlin breakaway territory of Transnistria at the start of the week.

He said it’s likely that internal forces were trying to stoke tensions and destabilize the country, adding “we are working full time to keep the situation calm.”

Russia Moves to Dodge Default With Claim Payment Made (4:24 p.m.)

Russia’s Finance Ministry said dollar payments on two foreign bonds are progressing after sanctions held them up for weeks. The amounts were $564.8 million on a 2022 Eurobond and $84.4 million on a 2042 bond. The development could sidestep a sovereign default that had looked all-but inevitable.

Czechs Refuse to Pay in Rubles, Talk With Poland on Pipeline (2:51 p.m.)

The Czech Republic will not pay for Russian gas in rubles, Prime Minister Petr Fiala said on Friday, calling accepting Russia’s terms is “dangerous” and breaching EU sanctions. The Czechs, who buy more than 90% their gas from Russia, will start talks with Poland on a gas pipeline project designed to diversify supplies and may purchase capacity at Polish liquefied natural gas terminals Fiala said.

Romania Says Pro-Russian Hackers Attack Websites (2:29 p.m.)

Romania said a pro-Russian hacking group attacked websites operated by its Defense Ministry, state railway company, border police and a financial institution.

The European Union and NATO member’s intelligence agency said the group, known as Killnet, took credit for so-called distributed denial-of-service attacks, shutting down the sites for several hours. Romanian parliament Speaker Marcel Ciolacu said this week that Bucharest is considering options for potential military aid to neighboring Ukraine.

Russia Surprises With Bigger Rate Cut and Warns on Downturn (1:28 p.m.)

Russia’s central bank cut interest rates more than forecast and indicated that borrowing costs may fall even lower, as priorities shift to supporting an economy derailed by international sanctions over Putin’s invasion of Ukraine.

Three weeks after reversing part of the emergency hike delivered after the attack, the Bank of Russia lowered its benchmark to 14% from 17%. Most economists surveyed by Bloomberg predicted a decrease to 15%. Policy makers warned the economy may face two straight years of contraction.

Policy makers issued new projections on Friday that showed the economy may contract 8% to 10% this year and end-year inflation could spike to as high as 23%.

US Citizen Killed Fighting in Ukraine, ABC Reports (12:57 p.m.)

Former US Marine Willy Joseph Cancel was killed in Ukraine while fighting Russian forces alongside Ukrainian troops, ABC News reported. Cancel, a 22-year-old US citizen, “was eager to volunteer” to fight against the invasion, ABC said, citing his wife.

Kremlin Declines to Say if Putin Will Attend G-20 (12:52 p.m.)

Russia is preparing for the Group of 20 summit in Indonesia but it’s too early to discuss details of its participation, Kremlin spokesman Dmitry Peskov told reporters on a conference call, in response to questions on the possibility of Putin meeting Ukrainian President Volodymyr Zelenskiy there.

Indonesian President Joko Widodo said earlier he’d invited both to the November summit in Bali and “expressed my hope that the war can end soon.” Putin assured him Russia “would do everything necessary and everything possible” to contribute to the success of the event, Peskov said, with no further details.

Norway Joins EU Sanctions With Russian Transport Ban (12:50 p.m.)

Norway joined the European’s latest sanctions package on Friday by introducing a ban on Russian road transport and on docking by the neighboring country’s vessels in response to the war in Ukraine, the government said.

Sweden Sees Two Russian NATO Narratives (11:49 am.) 

Russia has offered conflicting narratives around the potential NATO membership of Sweden and Finland, said Swedish Foreign Minister Ann Linde.

Russia has warned the Nordic countries of “consequences” if they join the defense alliance, yet Moscow has at the same time downplayed the importance of whether NATO has 30 or 32 members, Linde said at a press conference in Helsinki with her Finnish counterpart Pekka Haavisto.

Swedish and Finnish policy makers have agreed to seek entry into the NATO defense bloc simultaneously in mid-May, according to reports this week.

© 2022 Bloomberg

COMMENTS   0

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

Instrument Details  

You do not have any portfolios, please create one here.
You do not have an alert portfolio, please create one here.
INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us:

Search Articles:
Click a Company: