Ukraine latest: Global oil prices fall to lowest since invasion

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Biden administration takes another step toward advancing a controversial oil drilling

February 1, 2023

The Russian invasion of Ukraine that began on Feb. 24 continues, with casualties mounting on both sides.

Ukrainian forces are putting up resistance using Western military aid, and President Volodymyr Zelenskyy regularly calls on the world to do more to help. Governments around the globe have imposed heavy sanctions against Moscow but have stopped short of direct intervention for fear of sparking a wider conflict.

Meanwhile, rising geopolitical risk and volatile energy and financial markets are rocking Asia.

For all our coverage, visit our Ukraine war page.

Read our in-depth coverage:

Ukraine war casts long shadow over G-20’s economic cooperation

Russian sanctions threaten to make coal dirtier, more costly

Russia readies new Sakhalin-2 operator, putting Japan’s stake on the line

Mitsui, Mitsubishi slash value of Sakhalin-2 stakes by $1.66bn

Thailand export earnings threatened by rice glut

Entries include material from wire services and other sources.

Note: Nikkei Asia decided on March 5 to temporarily suspend its reporting from Russia until further information becomes available regarding the scope of the revised criminal code.

Here are the latest developments:

Friday, Aug. 5 (Tokyo time)

3:04 a.m. Global oil prices fall to their lowest since before Russia’s invasion of Ukraine, as traders now fear a possible recession could suppress demand for energy. West Texas Intermediate (WTI) crude futures fell 2.7% to $88.21, dropping below $90 for the first time since Moscow’s war in Ukraine began in February. Benchmark Brent crude futures dropped more than 3% to $93.81 a barrel.

1:56 a.m. A Russian court sentences American basketball star Brittney Griner to nine years in prison after finding her guilty of deliberately bringing cannabis-infused vape cartridges into Russia, a ruling that U.S. President Joe Biden calls “unacceptable.”

Before the verdict, she tearfully pleaded with a Russian judge not to “end her life” with a harsh prison sentence. The court also fined her 1 million rubles ($16,990). Her sentencing could pave the way for a U.S.-Russia prisoner swap that would include the 31-year-old athlete and a Russian who was once a prolific arms dealer.

The two-time Olympic gold medalist and Women’s National Basketball Association star was arrested in mid-February as she arrived to play for a Russian side during the WNBA offseason. Griner admitted having the vape cartridges containing hashish oil but said she made an honest mistake by inadvertently packing them.

Thursday, Aug. 4

9:30 p.m. The Bank of England warns of persistent energy-driven inflation and a looming recession after raising its main interest rate by 0.5 percentage point, to 1.75%.

“The latest rise in gas prices has led to another significant deterioration in the outlook for activity in the United Kingdom and the rest of Europe,” the central bank says in a statement on Thursday’s meeting. “The United Kingdom is now projected to enter recession from the fourth quarter of this year.”

The BoE expects consumer price growth to reach 13% in the fourth quarter of this year.

5:30 p.m. The head of the United Nations nuclear watchdog appealed for access to a Ukrainian nuclear power plant now controlled by Russian forces to determine whether it is a source of danger. Contact with the Zaporizhzhia nuclear plant, Europe’s largest, which is being operated by Ukrainian technicians, is “fragile” and communications do not function every day, International Atomic Energy Agency head Rafael Grossi told the Swiss newspaper Tages-Anzeiger.

“We can’t afford faulty communication with the plant in areas relevant to safety. We know of allegations that live ammunition is stored in the plant, that there are attacks on the power plant,” he said in the interview, published in German. “There are contradictions between the accounts of the Russian and Ukrainian sides. I receive information, I also mention it in my situation reports, but I have no way of determining whether it corresponds to the facts.”

11:50 a.m. Gazprom will receive 50% of a new Russian entity replacing the Sakhalin Energy liquefied natural gas project, Russian news agencies report, citing a government decree. Interfax said the new entity will be registered in the city of Yuzhno-Sakhalinsk on the Pacific island of Sakhalin. The Sakhalin-2 LNG plant is located 60 km south of Yuzhno-Sakhalinsk.

Japanese trading houses Mitsui & Co. and Mitsubishi Corp. on Tuesday cut the value of their stakes in the Sakhalin-2 LNG project by 217.7 billion yen ($1.62 billion) after Moscow’s move to seize control of it.

9:30 a.m. The U.S. Senate on Wednesday approved Finland and Sweden’s accession to NATO, the most significant expansion of the 30-member alliance since the 1990s, as it responds to Russia’s invasion of Ukraine. The Senate voted 95-1 to support ratification of the two countries’ accession documents, easily surpassing the two-thirds majority of 67 votes required.

“This historic vote sends an important signal of the sustained, bipartisan U.S. commitment to NATO, and to ensuring our Alliance is prepared to meet the challenges of today and tomorrow,” U.S. President Joe Biden said in a statement.

7:08 a.m. Russia has decided to establish a new operating company for the Sakhalin-2 oil and gas project, the government’s Tass news agency reports, with Japanese stakeholders facing the decision of whether to maintain their interests.

Located on Russia’s Pacific island of Sakhalin, the project supplies around 10% of Japan’s total liquefied natural gas imports.

Russian state gas company Gazprom owns just over 50% of Sakhalin Energy and will take a similar stake in the new operator. The remainder will be held by the new operator itself.

Shell, which now owns roughly 27.5% of Sakhalin Energy, has announced plans to withdraw from the Sakhalin-2 project. Japanese trading houses Mitsui & Co. and Mitsubishi Corp., with interests of 12.5% and 10%, still need to decide whether to apply for stakes under the new framework. Read more.

1:10 a.m. “Meaningless” and “almost insulting” is how one analyst quoted by Reuters describes the crude oil production increase just approved by OPEC and its allies.

OPEC+ will raise output by 100,000 barrels a day, or 0.1% of global demand. The move is a nod to U.S. President Joe Biden, who visited the Middle East recently to call on Saudi Arabia and others to pump more oil, but is likely a disappointment.

The Financial Times describes Wednesday’s decision as “one of the smallest oil production increases in the group’s history.” Read more.

12:00 a.m. The first ship carrying Ukrainian grain since a United Nations-brokered deal to restart exports has left the Black Sea and is headed to Lebanon.

The Sierra Leone-flagged cargo ship Razoni is carrying around 27,000 tonnes of Ukrainian corn.

In a statement, U.S. Secretary of State Antony Blinken commends the U.N. and Turkey for their role in the negotiations and says the shipment “raises hope of bringing the millions of tons of grain stuck at Ukraine’s ports to those facing food insecurity around the world.” Blinken calls on Russia to “end its attacks that are rendering farmland in Ukraine unusable and destroying agricultural infrastructure.”

Russian Foreign Minister Sergey Lavrov and Turkish counterpart Mevlut Cavusoglu discuss implementation of the grain export deal on the sidelines of the ASEAN Foreign Ministers’ Meeting.

Wednesday, Aug. 3

6:37 p.m. German Chancellor Olaf Scholz inspected a mechanical turbine at the center of a natural gas dispute and declared: “There are no problems” with the part despite words to the contrary from Russia’s state-controlled gas company. Russian energy giant Gazprom last week halved the amount of natural gas flowing through the Nord Stream 1 pipeline to 20% of capacity, citing delays with the turbine’s repair and delivery. But Scholz insisted the needed part was ready to be shipped to Russia at any time.

3:12 p.m. Hungarian drugmaker Richter reported a net profit of 76.5 billion forints ($195.66 million), beating expectations, as Russia remained the company’s second-biggest market. It also maintained operations in Ukraine. Sales grew strongly in the first half of 2022 across all markets except Ukraine, as revenue was lifted by outsized gains from exchange rate movements combined with price increases, Richter said in its earnings statement. Richter has experienced pressure from Ukraine to “rethink” its presence in Russia, but the company said last month that it is not leaving as it provides medicine for 12 million Russians.

1:00 p.m. Russia wants a negotiated solution to the war in Ukraine and last month’s agreement on grain shipments might offer a way forward, former German Chancellor Gerhard Schroeder and friend of Russian President Vladimir Putin says. “The good news is that the Kremlin wants a negotiated solution,” Schroeder told Stern weekly and broadcasters RTL/ntv, adding he had met Putin in Moscow last week.

“A first success is the grain deal, perhaps that can be slowly expanded to a ceasefire,” he said. Russia and Ukraine struck a deal last month to unblock grain exports from Black Sea ports and the first ship carrying Ukrainian grain to world markets since Moscow’s invasion five months ago is on its way to Lebanon.

11:18 a.m. Russia has accused the United States of direct involvement in the Ukraine war. Russia’s defense ministry, headed by an ally of President Vladimir Putin, said comments by Vadym Skibitsky, Ukraine’s deputy head of military intelligence, to Britain’s Telegraph newspaper showed that Washington was entangled in the conflict despite assertions it was limiting its role to arms supplies. Skibitsky told the paper there was consultation between U.S. and Ukrainian intelligence officials before strikes and Washington had an effective veto on intended targets but that U.S. officials were not providing direct targeting information.

8:19 a.m. The conflict in Ukraine does not warrant Russia’s use of nuclear weapons, but Moscow could decide to use its nuclear arsenal in response to “direct aggression” by NATO countries over the invasion, Russia said on Tuesday at a nuclear nonproliferation conference. Russian diplomat Alexander Trofimov rejected “utterly unfounded, detached from reality and unacceptable speculations that Russia allegedly threatens to use nuclear weapons, particularly in Ukraine.” Within days of Russia’s Feb. 24 invasion, Putin put the country’s deterrence forces — which include nuclear arms — on high alert, citing what he called aggressive statements by NATO leaders and Western economic sanctions against Moscow. Trofimov, a senior diplomat in the nonproliferation and arms control department of Russia’s foreign ministry, said Moscow would only use nuclear weapons in response to weapons of mass destruction or a conventional weapons attack that threatened the existence of the Russian state.

4:20 a.m. The U.S. Treasury and State departments announce fresh sanctions against Russian businesses, oligarchs and officials.

Among those sanctioned is Alina Kabaeva, chair of the National Media Group — a pro-Kremlin group of media organizations — and a former Olympic gymnast. The Treasury Department describes her as having a “close relationship to [Russian President Vladimir] Putin.”

Other targets include a leading steelmaker, a financial institution accused of sanctions evasion and entities in the country’s defense and technology sectors.

3:50 a.m. The first ship carrying grain from Ukraine under a United Nations-brokered deal has reached the Istanbul Strait, Turkish authorities say.

The Sierra Leone-flagged cargo ship Razoni, is carrying corn from Odesa to Lebanon. It has stopped in Turkey for joint inspects overseen by Turkish, Russia, Ukrainian and U.N. representatives — a provision of the deal to restart Ukrainian agricultural exports through the Black Sea.

3:20 a.m. Russia has called U.S. House Speaker Nancy Pelosi’s visit to Taiwan “a clear provocation in the spirit of the U.S. aggressive line of comprehensive containment” of China.

“The Chinese side has the right to take measures necessary to protect its sovereignty and territorial integrity in the Taiwan issue,” the Russian foreign ministry says in a statement.

The statement echoes China’s expressions of support for Russia’s “security interests” in Ukraine.

“We call on Washington to refrain from actions that undermine regional stability and international security and recognize the new geopolitical reality, in which there is no longer room for American hegemony,” the Russian statement says.

1:02 a.m. Russian Foreign Minister Sergey Lavrov visits Myanmar on Wednesday for talks with Wunna Maung Lwin, the Southeast Asian country’s top diplomat, Foreign Ministry spokeswoman Maria Zakharova says, according to Russian news agency Tass.

They plan to discuss “prospects for the entire complex of Russia-Myanmar relations, including political dialogue, trade and economic cooperation, interaction in the field of defense and security, as well as humanitarian ties,” Zakharova says. “Pressing international and regional issues will also be considered.”

12:30 a.m. Even as the war in Ukraine rages on, tensions are rising in the Indo-Pacific region with U.S. House Speaker Nancy Pelosi’s arrival in Taiwan — the highest-level American visit to the island in 25 years.

Pelosi has arrived at Taipei’s Songshan airport and is scheduled to meet with Taiwanese President Tsai Ing-wen on Wednesday.

Ahead of Pelosi’s visit, Vladimir Putin’s spokesman Dmitry Peskov had said it was unfortunate that the U.S. had chosen “the path of confrontation.”

The Chinese People’s Liberation Army’s eastern command has announced military exercises near Taiwan in response to the visit. In a statement, China’s Foreign Ministry says the country “will definitely take all necessary measures to resolutely safeguard its sovereignty and territorial integrity in response to the U.S. speaker’s visit.”

“All the consequences arising therefrom must be borne by the U.S. side and the ‘Taiwan independence’ separatist forces,” the statement adds.

Tuesday, Aug. 2

11:30 p.m. The U.S. Commerce Department on Tuesday will add 25 Russian-operated Airbus airplanes to the Biden administration’s sanctions list, Reuters reports.

The operators, which include Ural Airlines, are believed to violate U.S. export controls, Reuters reports. Tuesday’s move “further degrades Russian airlines’ ability to operate their fleets of both U.S. and EU airplanes,” Commerce Department Export Enforcement chief Matthew Axelrod says in a statement provided to Reuters.

6:14 p.m. Russian Defense Minister Sergei Shoigu said that Russia had destroyed six U.S.-made HIMARS missile systems since the beginning of the conflict in Ukraine, Interfax reports. Shoigu said Russia had also destroyed five anti-ship Harpoon missile launch systems and 33 M777 howitzers since Moscow deployed tens of thousands of troops to Ukraine on Feb. 24.

3:23 p.m. Mitsui & Co. and Mitsubishi Corp., stakeholders of Sakhalin Energy Investment Company, have slashed the asset value of the project by a combined 220 billion yen ($1.66 billion) amid uncertainty over a recent presidential decree. Mitsui reduced the asset value of its stake in the Sakhalin-2 energy project by 136.6 billion yen, while Mitsubishi reduced its by 81.1 billion yen. On June 30, Russian President Vladimir Putin signed a presidential decree to demand Bermuda-based Sakhalin Energy become a Russian company.

11:50 p.m. The U.S. says Russia is using Ukraine’s biggest nuclear power plant as a “nuclear shield” by stationing troops there, preventing Ukrainian forces from returning fire and risking a terrible nuclear accident. U.S. Secretary of State Antony Blinken said Washington he was “deeply concerned” that the Zaporizhzhia plant — the same one from March that Russia was firing shells close to — was now being used as a military base to fire on Ukrainian forces. “Of course, the Ukrainians cannot fire back, lest there be a terrible accident involving the nuclear plant,” Blinken told reporters after nonproliferation talks at the U.N. in New York on Monday. Russia’s actions went beyond using a “human shield,” Blinken said, dubbing the ploy a “nuclear shield.”

4:38 a.m. U.S. Secretary of State Antony Blinken announces up to $550 million in arms and equipment for Ukraine. This “includes more ammunition for the High Mobility Artillery Rocket Systems (HIMARS) and 155mm artillery systems.” The latest installment brings the Biden administration’s cumulative military aid to Ukraine to about $8.7 billion.

4:30 a.m. “Today, humanity’s just one misunderstanding, one miscalculation, away from nuclear annihilation,” United Nations Secretary-General Antonio Guterres tells a United Nations nuclear nonproliferation meeting. “Nuclear dangers” are now at their highest “since the height of the Cold War,” Guterres tells the review conference for the Nuclear Non-Proliferation Treaty (NPT).

Speaking at the conference, Japanese Prime Minister Fumio Kishida urges nuclear weapons states to disclose information on their production of fissile materials. Japan “encourages the U.S. and China to engage in a bilateral dialogue on nuclear arms control and disarmament,” he says.

Both Russian President Vladimir Putin and U.S. President Joe Biden issue written remarks. “We believe that a nuclear war cannot be won and must never be fought,” Putin says. Biden says that the U.S. is ready to pursue a new nuclear arms deal with Russia.

4:00 a.m. People from countries deemed “unfriendly” by Moscow would be barred from adopting Russian orphans under newly proposed legislation, Interfax reports. The bill has been introduced in the State Duma, Russia’s parliament. It leaves open the possibility of lifting the adoption ban for countries removed from the “unfriendly” list, according to Interfax.

Monday, Aug. 1

6:15 p.m. Russia’s defense ministry says its forces have destroyed two U.S.-made HIMARS in Ukraine’s Kharkiv region, and a launch system for Harpoon anti-ship missiles in the Odesa region, Interfax reports.

5:00 p.m. The first ship carrying grain to leave Ukraine under a safe passage agreement will anchor off the coast of Istanbul around 1200 GMT on Tuesday for a joint inspection, Turkish Defense Minister Hulusi Akar says. Akar was speaking in an interview with Turkey’s state-owned Anadolu news agency after the Sierra Leone-flagged ship Razoni, which is loaded with corn, left the Ukrainian port of Odesa for Lebanon. As part of the agreement, a Joint Coordination Center was set up in Istanbul with personnel from the United Nations, Russia, Ukraine and Turkey.

3:46 p.m. A ship carrying Ukrainian grain has left the port of Odesa, the first to do so as part of a deal to unblock Ukraine’s Black Sea ports, Infrastructure Minister Oleksandr Kubrakov says. “The first grain ship since #RussianAggression has left port. Thanks to the support of all our partner countries & @UN we were able to fully implement the agreement signed in Istanbul,” he wrote on Twitter.

11:00 a.m. Anatoly Chubais, who resigned as a high-ranking adviser to Russian President Vladimir Putin and left Russia shortly after the invasion of Ukraine, was reported to be in intensive care in a European hospital on Sunday for a neurological disorder. Ksenia Sobchak, a Russian television personality and family friend of Chubais, said on Telegram that she had spoken with his wife and that he was suffering from Guillain-Barre syndrome, a rare disorder in which the body’s immune system attacks the nerves. Although Chubais did not state his reason for resigning in March, it was presumed to be because of Russia’s invasion of Ukraine.

8:31 a.m. Russian missiles pounded the southern Ukrainian port city of Mykolaiv early on Sunday, killing the owner of a major grain exporter, while a drone strike on Russia’s Black Sea naval base in Sevastopol was launched from within the city in a “terrorist attack,” a Russian lawmaker says.

Oleksiy Vadatursky, founder and owner of agriculture company Nibulon, and his wife were killed in their home, Mykolaiv Gov. Vitaliy Kim said on Telegram. Headquartered in Mykolaiv, a strategically important city that borders the mostly Russian-occupied Kherson region, Nibulon specializes in the production and export of wheat, barley and corn, and has its own fleet and shipyard.

Five Russian navy staff members were injured by an explosion after a presumed drone flew into the courtyard of Russia’s Black Sea fleet headquarters in Russian-occupied Sevastopol, the Crimean port city’s Gov. Mikhail Razvozhayev told Russian media.

Sunday, July 31

5:29 p.m. Russian President Vladimir Putin says on Navy Day in St. Petersburg that the navy will receive hypersonic Zircon cruise missiles within months and that the location of their deployment will depend on Russian interests.

Before the speech, Putin signs a new naval doctrine setting out the force’s broad strategic aims, including its ambitions as a “great maritime power” extending over the entire world. The doctrine identifies the U.S.’s “strategic course towards dominance” in the ocean and growing NATO activity close to Russia as major security threats, the government’s Tass news agency reports.

4:51 a.m. Ukraine decides on a mandatory evacuation of people in the region around the eastern city of Donetsk, the scene of fierce fighting with Russia, President Volodymyr Zelenskyy says. In a late-night address, the president also says the hundreds of thousands of people still in combat zones in the larger Donbas region need to leave.

For earlier updates, click here.

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