U.S. announces new package of targeted sanctions on Russia

RUSSIA ENERGY / FINANCE - In Brief 28 Apr 2014 by Marcel Salikhov

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The U.S. Treasury announced new list of Russian individuals and companies affected by Ukraine-related sanctions. The list of individuals includes some high-level public servants like Vyacheslav Volodin, first deputy chief of staff of the Presidential Administration and Dmitry Kozak, deputy Prime minister and others. It also includes two CEOs of largest Russian companies, Igor Sechin (Rosneft) and Sergei Chemezov (Rostec). We note that it doesn’t include Alexey Miller of Gazprom that had prevoiusly rumored. The companies affected by new sanctions' list include some medium to large ones controlled by Gennady Timchenko and/or Arkady and Boris Rotenbergs. The most known are Volga Group (holding company of Timchenko’s assets) and Stroytransgas (one of the largest Russian engineering companies). Obviously new sanctions mean new hit for the financial markets and increased risks for foreign companies having businesses with companies or individuals affected. At the same time US sanctions remain targeted on specific individuals and companies and not not entire industries. The list of sanctioned companies still remains relatively modest. For example, it doesn’t include Novatek, an independent gas producer, where Mr Timchenko has 23% equity ownership. It also doesn't include some major Russian banks that could potentially disrupt local financial activity. So we think that the Obama administration still leaves the door open for some kind of diplomatic solution and bets on changes in Russian policy towards Ukraine.