Japan to Phase Out Russian Oil; Crude Swings

Japan to Phase Out Russian Oil;  Crude Swings

(Bloomberg) —

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Japanese Prime Minister Fumio Kishida plans to gradually phase out imports of Russian oil as he joined other Group of Seven leaders in stepping up pressure on President Vladimir Putin by pledging to halt crude imports from his country.

Oil fluctuated in trading to start the week with investors weighing the impact of the move by the bloc. Crude has had a tempestuous year as Russia’s invasion of Ukraine upends global commodity markets.

Ukrainian President Volodymyr Zelenskiy marked a day of remembrance for the defeat of Nazi Germany, with Putin set to address a military parade in Moscow Monday where he may lay out the next steps of his war.

(See RSAN on the Bloomberg Terminal for the Russian Sanctions Dashboard.)

Key Developments

  • Mariupol Steel Plant’s ‘Dead Men’ Defenders Call for Rescue Plan

  • US Bans Accounting Services to Russia in New Sanctions Package

  • Ukraine’s Tiny Neighbor Suffers Economic Fallout From the War

  • Hungary Continues to Block EU Oil Sanctions on Russia

All times CET:

Oil Swings as Traders Weigh G-7 Crude Ban (5:16 am)

Oil fluctuated as investors weighed a pledge by the Group of Seven to ban imports of Russian crude against a cut in official prices by Saudi Arabia and the impact of China’s energy-sapping lockdowns.

West Texas Intermediate traded near $110 a barrel after earlier losing as much as 1.7%. The US and the UK have already moved to ban imports of Russian fuel in response to the assault, but the weekend pledge by the G-7 will increase the pressure on Moscow further.

Read more: Oil Swings as Traders Weigh Up G-7 Crude Ban, Saudi Price Cuts

Jill Biden to Meet President of Slovakia (2:32 am)

Jill Biden finishes her trip to the region with a meeting Monday with Slovakian President Zuzana Caputova before returning to Washington, her office said in a statement.

The US first lady earlier crossed into western Ukraine for an unannounced visit and met Ukrainian counterpart Olena Zelenska. Zelenska hasn’t appeared in public since Feb. 24, the day of Russia’s invasion, a US official said.

Read more: Jill Biden Meets Zelenskiy’s Wife in Unannounced Ukraine Visit

US Bans Accounting Services to Russia (1:39 am)

The US banned American accounting and consulting firms from working with Russia and imposed its first sanctions on Gazprombank.

The latest penalties include new export controls on industrial goods, limits on three of Russia’s top state-controlled television stations and additional visa restrictions, according to a White House statement.

Read more: US Bans Accounting Services to Russia in Added Sanctions

Japan Takes ‘Difficult’ Decision on Russia Oil (12:48 am)

The impact of the ban is likely to be limited, as the world’s third-largest economy imported only 3.6% of its crude oil from Russia in March, compared to 10.8% of its coal and 8.8% of its gas in 2021. Still, the move threatens to add to surging gasoline costs that have stoked inflationary fears ahead of an upper house of parliament election two months away.

Read more: Japan’s Kishida Says Phasing Out Russian Oil to Take Time

UK Sets Third Round of Russia Sanctions (11:30 pm)

The UK announced a third round of trade sanctions against Russia and Belarus, taking to more than 4 billion pounds ($4.9 billion) the value of products subject to full or partial import and export bans.

New import tariffs will cover 1.4 billion pounds in goods, including platinum and palladium. Russia is a leading producer of both metals and is “highly dependent” on the UK as a buyer of its exports, the UK government said in a statement.

Zelenskiy Calls on G-7 to Keep Up Arms Supplies (10:45 pm)

President Volodymyr Zelenskiy thanked G-7 countries for supplying weapons and said they need to keep up supplies so Ukraine can defeat Russia, according to an account of his comments to Group of Seven leaders on Sunday provided by his office.

Deliveries of multiple-rocket launchers, for instance, would have saved many lives, he told the G-7.

Trudeau Pledges More Military Aid in Kyiv Visit (10:02 pm)

Prime Minister Justin Trudeau visited Kyiv and said Canada will provide an additional $50 million in military support, including drone cameras, satellite imagery, small arms and artillery ammunition, his office said in a statement.

Canada will also continue to help with demining operations, Trudeau told reporters in the Ukrainian capital, where he also reopened the Canadian Embassy during his previously unannounced trip.

Mariupol Steel Plant Defenders Call for Rescue (9:19 pm)

If Russia’s President Vladimir Putin hoped to mark Victory Day by celebrating the capture or surrender of Mariupol’s last Ukrainian defenders, a Zoom appearance by their commanders suggests he’ll have to wait.

In an online press conference on Sunday, an intelligence officer of the Azov regiment holed up in the southeastern port city’s massive Azovstal steel factory said surrender would amount to suicide. He said they had enough food and weapons to hold out a while yet.

Describing their increasingly grim, and likely ultimately hopeless, circumstances, Illia Samoilenko also made clear his bitterness with the Ukrainian government in Kyiv. It had, he said, failed in its defense of southern Ukraine, where Russia made much faster progress than in the north, and had abandoned Mariupol’s garrison to its fate.

Lockheed Seeks to Double Javelin Missile Output (8:03 pm)

Lockheed Martin Corp. is working to almost double its production capacity for Javelin missiles to 4,000 a year and achieving that goal will require the supply chain to “crank up,” the defense contractor’s top executive said.

The Ukrainian army has used Lockheed’s missiles to great effect in destroying Russian tanks and armaments, and the company is ramping up production to ensure the US military’s supplies aren’t depleted. Right now Lockheed can build about 2,100 Javelins a year, Chief Executive Officer Jim Taiclet said Sunday on CBS’s “Face the Nation.”

G-7 Leaders Commit to Russia Oil Import Ban (6:30 pm)

Leaders of the Group of Seven pledged to ban the import of Russian oil.

The heads of the leading economies made the commitment after holding a video call with Ukraine President Volodymyr Zelenskiy on Sunday, the eve of Russia’s May 9 Victory Day, which commemorates Russia’s victory over Nazi Germany in World War II. The date has become a touchstone of the Kremlin’s campaign to whip up public support for the invasion.

The leaders will “commit to phase out our dependency on Russian energy, including by phasing out or banning the import of Russian oil,” the G-7 said in the statement.

Germany’s Scholz Sets Limits on Ukraine Policy (6:00 pm)

Chancellor Olaf Scholz outlined limits on Germany’s efforts to help Ukraine in a televised address. While Germany will continue to supply heavy weapons to help Ukraine defend against Russia, Europe’s biggest economy won’t sacrifice its security or affluence, he said.

US Diplomats in Kyiv Ahead of Embassy Reopening (5:15 pm)

Charge d’Affaires Kristina Kvien led a team of US diplomats that traveled to Kyiv for ceremonies to mark the anniversary of the Allied victory over Nazi Germany in World War II.

Secretary of State Antony Blinken told Ukrainian Foreign Minister Dmytro Kuleba the diplomats were there “to conduct diplomatic engagement in advance of the planned resumption of Embassy Kyiv operations,” State Department spokesman Ned Price said.

The US initially moved its diplomats to the western Ukrainian city of Lviv in the days leading up to Russia’s invasion, then operated from Poland. Diplomats last month started making day trips into Lviv.

Russian Infrastructure Official Visits Mariupol (4:30 pm)

Russian Deputy Prime Minister Marat Khusnullin, whose portfolio includes construction, visited occupied areas of Ukraine including the recently captured city of Mariupol, according to a statement posted to his Telegram channel.

Khusnullin, who was sanctioned by the European Union in February for his role in undermining Ukrainian sovereignty, said Russia would help the seized territories rebuild and provide humanitarian support.

Vitol Says It’ll Get Harder to Trade Russian Oil From Mid-May (2:30 pm)

Commodity firms will find it much harder to buy and sell Russian oil from the middle of this month, according to the world’s biggest independent crude trader, as Europe tightens sanctions on Moscow.

Russia’s exports of crude and oil products have probably dropped by about 1 million barrels a day from 7.5 million before the attack in late February, Mike Muller, head of Asia at Vitol Group, said Sunday. They could fall further after May 15, he said, because many trading houses interpret EU regulations as prohibiting them from dealing with Russian state energy companies beyond then. “There will be a “different reality.”

U2’s Bono, the Edge Perform in Kyiv Metro (2:26 pm)

Bono and the Edge, members of Irish rock band U2, performed in a Kyiv metro station on Sunday at the invitation of Ukrainian President Volodymyr Zelenskiy in a “show of solidarity with the Ukrainian people,” the band said on Twitter.

In a video posted by Ukrainian politician Serhiy Leshchenko, the pair were seen with Taras Topolia, front man of the local band Antytila, performing the Ben E. King standard, “Stand by Me.”

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