Update(18:42ET): On Thursday Russia released its list of exports that are banned as retaliation against Western sanctions. "These measures are a logical response to those imposed against Russia and are aimed at ensuring uninterrupted functioning of key sectors of the economy," the economy ministry said.
Notably, the only major commodity being banned is lumber, despite two days ago upon the initial announcement the Kremlin saying "certain commodities and raw materials" would fall under the ban. While not yet naming the precise list of specific items it's said to include 200 total products...
"The list includes technical, telecommunication and medical equipment, vehicles, agricultural machinery, electrical equipment - more than 200 items in total, including railway cars and locomotives, containers, turbines, metal and stone processing machines, monitors, projectors, consoles and panels," the Kremlin statement says. "This measure is necessary to ensure stability in the Russian market."
Whew. I was afraid my Russian bride wouldn't ship.— Alvin Quinn (aka The Thinker) 👨🎓🕵️♂️ (@bquicker) March 10, 2022
And more according to Reuters:
Interfax news agency cited a source familiar with legislation being prepared as saying Russia may temporarily ban grain exports to a group of ex-Soviet countries forming part of the Eurasian Economic Union (EEU) from March 15 to August 31, as well as sugar exports outside the EEU area.
Also on Thursday Russian President Putin addressed soaring energy prices in the West and worldwide, saying Washington is engaged in an empty blame-game. He urged the public not to accept the US narrative that he is to blame. According to a state media translation, Putin said:
"The prices there [for energy carriers in the EU countries] are growing, but not through our fault. This is the result of their own miscalculations. They should not blame us for this."
"The same applies to the surge in prices for oil and petroleum products in the United States. They announced that they were closing the import of Russian oil to the American market, prices there are high, inflation is unprecedentedly high, probably reached all-time highs. They are trying to shift blame for the results of their own mistakes on us," the Russian leader added.
At least people will start walking again pic.twitter.com/27zLjXmGUr— zerohedge (@zerohedge) March 10, 2022
And more via TASS: According to him, this is obvious to market experts, "because the supply of Russian oil to the American market does not exceed 3%."
"This is a negligible volume, and their prices are rising. We have absolutely nothing to do with it, and even here the ban on Russian oil imports has absolutely nothing to do with it. They just hide behind these decisions in order to once again deceive their own population," Putin said.
He further called out US hypocrisy for seeking to quickly do deals with Maduro's Venezuela as well as the Islamic Republic:
"They are ready to make peace with Iran, immediately sign all the documents, and with Venezuela. They went to Venezuela to negotiate, but they should not have introduced these illegitimate sanctions," he said. "The same will happen in relations with our country, I have no doubt about that."
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Update(12:45ET): European Union foreign policy chief Josep Borrell issued a provocative statement aimed at Moscow and Putin personally on Thursday. Borrell declared that Vladimir Putin invaded Ukraine starting on Feb.24 with the belief that he was quickly going to conquer Ukraine, but that "he failed". Borrell stated of Putin: he "believed he was going to conquer Ukraine" but "he failed."
The EU top diplomat continued:
"He believed he was going to divide us; he failed. He believed that he was going to weaken the transatlantic relationship and he failed. Now he has to stop," he added while speaking to reporters while entering a summit of EU leaders in France’s Versailles.
Borrell also addressed the necessity of Europe winding down its energy dependence on Russia, saying, “we will be much safer. Have to spend less gas, use less gas, the climate requires that. For once, geopolitics and climate go together.”
UAV footage showing Ukrainian attacks on a Russian armored column in Brovary, including that captured T-72A tank. According to the audio, the regimental commander was killed. It appears it was a mix of Ukrainian artillery and tank strikes on the column.https://t.co/LemIgjQiOZ pic.twitter.com/x2tVSHPENa— Rob Lee (@RALee85) March 10, 2022
European Commission head Ursula von der Leyen had a similar message at the summit in Versailles, saying, "we will rethink European defense with strong capabilities. We will rethink energy. We have to get rid of the dependence of Russian fossil fuels and for that we need massive investment in renewables."
During the fourth round of Ukraine-Russia talks, Kiev is reported to have offered "neutrality" on the NATO question, but it went nowhere:
Thursday’s high-level talks in Turkey between Ukrainian and Russian foreign affairs counterparts ended in no progress for a potential cease-fire or for protecting civilians in the heavily bombarded Mariupol, even after Ukraine suggested a "neutrality" proposal with security guarantees from world powers.
In the most senior interaction since Russian President Vladimir Putin launched the invasion of Ukraine on Feb. 24, the failed talks between Ukraine Foreign Minister Dmytro Kuleba and his counterpart, Russia's Foreign Minister Sergey Lavrov, lasted just 90 minutes in the Turkish coastal city of Antalya.
Russia reportedly rejected Ukraine’s "neutrality" proposals that promised international security guarantees, according to the Financial Times. The two sides discussed a 24-hour cease-fire but did not make progress, as Russia was still seeking "surrender from Ukraine," Kuleba said.
And via Bloomberg on Thursday, Russia has signaled it's ready repay debt in increasingly worthless rubles in a fresh counterthreat to drop sactions: "Russia will repay debt in rubles if agent banks deny to unfreeze reserves or don’t respond to queries," Finance Minister Anton Siluanov said. He further stipulated:
- Repayment of debt, payment of coupons in FX will only be possible if the FX accounts of the government and central bank are “unfrozen,” he says
- Russia “will fulfill obligations to investors in any case,” he says
The European Union is imposing additional sanctions that would target 160 Russian leaders and prominent figures — including oligarchs.— Kyle Griffin (@kylegriffin1) March 10, 2022
The new sanctions extending to Belarus, which include reduced access to the SWIFT banking system. @NBCNews
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With newsflow out of Ukraine having become a firehose, with market moving headlines firing every minute, traders can be forgiven if they have just given up following the narrative. To help out, here is a snapshot of all the latest market-moving news out of Ukraine from the last few hours:
Ukraine and Russia failed to make progress in halting the war at the first high-level talks between their foreign ministers since the Russian invasion began.
Ukrainian Foreign Minister Kuleba says no progress on ceasefire; Russia stuck to its script; holding the meeting with his Russian counterpart was not easy; ready to meet again in this format; ready to continue engagement to stop the war. Mariupol was the most difficult situation, Lavrov did not commit to a humanitarian corridor in Mariupol. Have two tasks now: organizing humanitarian corridor from Mariupol and reaching 24-hour truce.
“The broad narrative he conveyed to me is that they will continue their aggression until Ukraine meets their demands, and the least of these demands is surrender,” Kuleba said.
Hosted by Turkish Foreign Minister Mevlut Cavusoglu in the Mediterranean resort city of Antalya, this was the most senior in-person meeting between Ukraine and Russia since the Russian invasion began Feb. 24.
The main sticking point, from a Ukrainian perspective at least, appears to be the humanitarian corridors as Kuleba noted that there was no progress on a ceasefire and the city of Mariupol was the most difficult situation. During the presser, the Mariupol, Ukraine City Council says the city is under attack from the air; residential buildings have been hit and the Deputy Ukrainian PM added that a humanitarian corridor attempting to reach the city had to turn around given the fighting.
Russia is open to serious talks between the two presidents “but those contacts must have added value,” Lavrov told reporters after the meeting. He reiterated that Russia is seeking the demilitarization of Ukraine.
“We want a Ukraine that’s friendly and demilitarized, a Ukraine in which there isn’t a risk of the creation of another Nazi state, a Ukraine where there won’t be a ban on the Russian language, on Russian culture,” Lavrov said.
German Chancellor Olaf Scholz and French President Emmanuel Macron spoke to Putin by phone Thursday and reiterated their demand for an immediate cease-fire. The three leaders agreed to stay in close touch in coming days, according to a statement from Scholz’s office.
In terms of the market reaction, Kuleba began speaking first and his remarks that there was no ceasefire progress and seemingly intimating that a Presidential-level meeting was not due imminently sparked some pressure in the equity space, hampering the ES March’22 contract by around 15-points, geopolitical-premia lent some support to WTI and Brent as well, moving to fresh incremental highs. However, the most significant move was in Spot Gold, which tested USD 2k/oz to the upside (high USD 2000.03/oz), gaining around USD 20/oz amid the commentary from the ministers.
Looking ahead, look for updates on Kuleba's focus points of a humanitarian corridor from Mariupol and attaining a 24-hour truce. Additionally, for any indications towards, as suggested by Ukraine, another Foreign Ministers meeting and/or a gathering between the respective Presidents. Note, the situation at the Chernobyl nuclear plant has not developed following the power outage reported earlier in the week, during the Foreign Ministers press conference the Ukrainian Energy Minister confirmed the ongoing lack of power.
Russian Foreign Minister Lavrov says a possible meeting between the Ukrainian and Russian presidents was discussed; but need more preparations, Reminded Ukraine that Russia had presented its proposals and Moscow wants a reply. Prepared to discuss security guarantees for Ukraine. Possible meeting between the Ukrainian and Russian presidents was discussed; but need more preparations. No one here today was discussing a ceasefire; on oil/gas sanctions, says never used oil and gas like weapons.
Reminder, prior to the Foreign Ministers meeting the Russian Kremlin said the Turkey meeting could open the way for talks between Russian President Putin and Ukrainian President Zelensky, awaiting the outcome of today's Foreign Minister talks.
Ukrainian President Volodymyr Zelenskiy has said he’s willing to consider some compromises on Russia’s demand that his country abandons ambitions to join the North Atlantic Treaty Organization and adopt a neutral position.
Zelenskiy’s also said that “only after the direct talks between the two presidents can we end this war,” and that there’s been no direct contact between him and Putin.
EU is to back Ukraine's European bid although fast membership is unlikely, according to Sputnik citing reports.
UK PM Johnson told Ukrainian President Zelensky that he is committed to further tightening sanctions to impose maximum economic costs on Russia, according to a Downing Street spokesperson.
Russian Finance Ministry said domestic banks would be allowed to lend to companies controlled by non- residents and the move will allow firms wishing to continue doing business in Russia to work as usual.
Morningstar Indexes determined it is necessary to reclassify Russia from emerging market to unclassified and will remove all Russian securities from the Morningstar fixed income indexes as of March 31st.
Ukraine gas transmission network operator says that Russian forces have taken control of gas compressor stations, which threatens transit to Europe.
European Union has reached the limit of its capabilities when it comes to financial sanctions against Russia, according to NEXTA citing Head of EU diplomacy Borrell, via NEXTA
White House said Russia's claims of alleged US biological weapons labs and chemical weapons development in Ukraine are false and that the US should be on the lookout for Russia to possibly use chemical or biological weapons in Ukraine in light of its false claims.
US Secretary of State Blinken discussed with Ukrainian Foreign Minister Kuleba additional security and humanitarian assistance for Ukraine and discussed Russian attacks on population centres US Defense Secretary Austin spoke with Ukrainian counterpart about continued provision of defensive assistance for Ukraine.
Spain is ready to send a new batch of weapons to Ukraine, according to reports in Sputnik citing the Defence Minister
Third Party Remarks
Pimco risks losing billions in the event of a default by Russia with the fund manager exposed to a derivative bet of at least USD 1.1bln and holds USD 1.5bln of sovereign bonds, according to FT.
White House said the US is continuing to engage with Iran deal partners including Russia, while it believes US and Russia share an objective on the Iran nuclear deal.
Iran's Secretary of the Supreme National Security Council of Iran Shamkhani said nuclear talks have become more complicated every hour and that the US's desire for a quick agreement indicates it has no will for a strong nuclear deal.
Iranian Supreme Leader says Iran will not bow to pressure to reduce defensive power, regional presence and progress in nuclear technology.