Ukraine Latest: EU Backs Russian Oil Cap in Sanctions Package

  • In Business
  • 2022-10-05 11:33:40Z
  • By Bloomberg

(Bloomberg) -- The European Union approved a fresh package of Russia sanctions that includes a price cap on oil sales, as Ukrainian President Volodymyr Zelenskiy said his forces were advancing in the south.

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The Kremlin vowed to recapture territory that's been seized back by Ukrainian forces, saying that occupied regions to which Moscow has laid claim will be "with Russia forever." That comes as Ukrainian forces press through sparsely-manned defense lines in the southern region of Kherson, making "substantial" progress, according to the US-based Institute for the Study of War.

Elsewhere, Russian natural gas supplies to Italy via Austria resumed after Gazprom PJSC said it had found a solution with Italian buyers to overcome regulatory changes in Austria. The spat with Austrian authorities is the latest dispute brandished by the gas giant to halt flows to Europe.

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

Key Developments

  • EU Backs Russia Sanctions Package Including Oil Price Cap

  • Gazprom Resumes Flows to Italy via Austria as Spat Resolved

  • EU Chief Urges More Funds for Energy Pivot, Floats Gas Price Cap

  • Ukraine's Central Bank Governor Quits as War Devastates Economy

  • Poland Is in Talks With US About Nuclear Weapons, President Says

  • Putin Is Losing Coercion War and That's Dangerous: Hal Brands

On the Ground

Ukrainian forces continued to make "substantial" gains in the north of the Kherson region, beginning to collapse sparsely-manned Russian lines in that area, the ISW said. Ukrainian forces advanced in the eastern Kharkiv region west of Svatove. Their forces have liberated several small towns in Luhansk -- a region still mostly controlled by Russia -- according the governor, Serhiy Haiday.

Russia launched an overnight drone attack on the city of Bila Tserkva, 75 kilometers (47 miles) southwest of the nation's capital, Ukrainian Air Force spokesman Yuriy Ignat said on television. The Ukrainian military expects similar strikes in other areas as Russia may have taken delivery of hundreds of drones from Iran, he said.

(All times CET)

NATO Taking Putin Nuclear Threat Seriously (12:46 p.m.)

Chris Badia, NATO's deputy supreme allied commander for transformation, said the alliance takes Russian President Vladimir Putin's comments "absolutely seriously," especially given Russia's performance in the war in Ukraine and how the president might react to that.

While speaking on a panel at the Warsaw Security Forum, Badia said NATO is a defensive alliance and prepared with all means. "All options are on the table from a military point of view," he said, adding if anything should happen, it would be a political decision. He signaled that a response would likely be "conventional," initially.

"If you look at escalation metrics and think it through, I would say most probably this would be one of the first options on the table," Badia said, "but nothing can be ruled out."

Kremlin Vows to Retake Annexed Lands Lost to Ukraine Advances (12:30 p.m.)

Russia plans to retake the parts of Ukraine it lost to Kyiv's advances in recent days after formally declaring that the annexation of those territories, according to Kremlin spokesman Dmitry Peskov.

"There's no contradiction. They will be with Russia forever, they will be returned," he said in response to a question about how the retreat of Moscow's forces from the areas in recent days fit with the Kremlin's repeated claims that they will be Russian territory permanently.

Peskov also kept up the uncertainty about the precise borders of the lands Russia is claiming, refusing to specify where they lie in the contested areas. He suggested that the Kremlin is laying claim to territory controlled by its occupation administrations, but also said that it's planning to retake more and will "consult" with residents who want to join Russia.

Europe Approves Fresh Sanctions Against Russia (11:30 a.m.)

The EU backed a new package of Russia sanctions that includes support for a price cap on oil sales to third countries and mechanisms to avoid circumvention of sanctions, Andrzej Sados, the Polish ambassador to the EU, told reporters.

The measures would add a ban on shipping Russian oil to existing restrictions on services needed to transport it, but carve out an exemption for crude priced at or under a level set by a coalition of the Group of Seven and other countries, according to a draft of the proposal seen by Bloomberg.

UN Says More Than 6,000 Ukrainian Civilians Killed (11:06 a.m.)

The Office of UN High Commissioner for Human Rights recorded 6,114 Ukrainian civilian deaths as of Oct. 2 after Russia invaded Ukraine on Feb. 24, according to an e-mailed statement Wednesday. A total of 9,132 civilians were injured. Most casualties were caused by shelling from heavy artillery, multiple launch rocket systems, missiles and air strikes.

The figures may be considerably higher, as reports from areas where intense hostilities have been continuing are delayed and pending corroboration.

Russian Gas Flows to Italy Resume (9:58 a.m.)

European natural gas prices slid after Russia's gas giant said flows of the fuel to Italy via Austria were resuming after a solution with Italian buyers was reached to overcome the regulatory changes in Austria at the end of last month that had prevented transit flows.

Italy's Eni SpA confirmed the resumption of flows, while Austria's regulator said a solution appeared to have been found.

Putin Signs Annexation Laws (9:40 a.m.)

President Putin signed laws formally annexing four regions of eastern and southern Ukraine even as Russian troops don't fully control any of them.

Putin also signed decrees naming separatist leaders of the self-declared Donetsk and Luhansk people's republics, and of the Kherson and Zaporizhzhia regions as acting heads of Russian occupation authorities.

Poland in Nuclear Talks With US (8:42 a.m.)

Poland is in talks with the US about participating in a nuclear weapons sharing program to counter growing threats from Russia, President Andrzej Duda told the Gazeta Polska newspaper. NATO's biggest eastern European member nation has been ramping up military spending following Russia's invasion of Ukraine, but until now officials haven't broached the topic of seeking nuclear weapons as a deterrent.

Zelenskiy Hails 'Powerful' Advance (7:39 a.m.)

The Ukrainian army is carrying out "a pretty fast and powerful advance" in the south of the country, the Ukrainian leader said in his nightly address. Dozens of settlements in the Kherson, Kharkiv, Luhansk and Donetsk regions have already been liberated this week.

Zelenskiy said he'd talked by phone to President Biden and thanked him for new HIMARS, as well as another package of support. He also held conversations with Indian Prime Minister Narendra Modi and Italy's Giorgia Meloni.

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