Russia ready to settle Eurobond payment claims

(Bloomberg) – Russia’s Finance Ministry has said it is ready to settle claims over its 2022 Eurobonds that were found to have breached their terms after missing a $1.9 million interest payment, in an effort to avoid an insurance payout potentially worth billions of dollars.

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OPEC+ is expected to approve a modest increase in oil production at its monthly meeting on Thursday, as the Financial Times reported that Saudi Arabia is ready to increase supplies if Russian production falls due to sanctions.

The Pentagon says the new, longer-range rockets the US is supplying Ukraine will take three weeks of training to operate, as Moscow has warned the weapons could be used for attacks inside the territory. Russian. Slovakia and Poland have agreed to sell howitzers to Ukraine.

(See RSAN on the Bloomberg Terminal for the Russian sanctions dashboard.)

Key developments

  • Germany risks reclaiming ‘sick man’ status over Russia-China ties

  • US wavers over next Russia sanctions as divisive fears grow

  • Russia’s economy contracted in April amid sanctions

  • EU push for partial Russian oil ban delayed by Hungarian demands

  • Saudis ready to pump more oil if Russian production drops, FT says

  • Putin bets on Ukraine winning before its economy shuts down

Russia ready to settle claims on interest payments (10:00 a.m.)

Russia will review and, if necessary, settle claims by holders of its 2022 Eurobonds that additional interest payments are owed to them for the period between the maturity of the notes and the date of payment, the ministry said. of Finance of the country in a press release.

The Ministry of Finance blamed foreign counterparties for the delay, which was called a “default” by the Credit Derivatives Determination Committee.

Russian missiles hit infrastructure near Polish border (9:47 a.m.)

Four Russian cruise missiles launched from the Black Sea struck railway infrastructure in the Lviv region near the Polish border on Wednesday, causing significant damage, regional governor Maksym Kozytskyi said in a statement on Facebook.

Five people were injured and many trains were delayed due to the strikes, he said. Ukraine depends on rail and road links with Poland for trade, arms deliveries and humanitarian aid.

Sberbank finds a buyer for the Swiss unit (9:33 a.m.)

The Swiss unit of Sberbank, Russia’s largest lender, has found a new buyer who faces no sanctions that could allow it to resume commodity trade financing in a few weeks, Le Temps reported. .

Sberbank (Switzerland) AG expects to complete the transaction within a week, the Swiss newspaper reported, citing an email to customers it had seen. A resumption of operations would be significant given that its Russian parent company is expected to be barred from access to the SWIFT international payments system under the latest wave of European Union sanctions.

Read more: Swiss unit of Sberbank finds new unauthorized buyer, says Le Temps

Fiji court delays US seizure of Russian superyacht (9:30 a.m.)

A US bid to seize a $325 million superyacht believed to be owned by sanctioned billionaire Suleiman Kerimov has been delayed by a Fijian court, after the boat’s registered owner won a temporary stay of a previous judgment. The Supreme Court is expected to rule on the appeal on June 7, when the stay will expire, according to the Pacific island nation’s prosecution office.

The showdown in Fiji is a preview of the kind of court battles that could unfold as countries like the United States, Spain and Germany go after the boats, villas and planes of Russian tycoons who have been listed on sanctions lists for their ties to President Vladimir Putin. . Already more than a dozen yachts worth more than $2.25 billion have been seized as part of the push, sparked by the invasion of Ukraine.

Merkel breaks the silence on the war in Ukraine (9:08)

Six months after leaving office, former German Chancellor Angela Merkel condemned Russia’s “barbaric war of aggression” in her first public comments on the invasion.

Merkel has backed efforts by the German government and its allies to stop the war, according to an attendee at a closed-door German DGB union event Wednesday night in Berlin who asked not to be identified.

The longtime chancellor has not commented on her policy towards Russia or her support for the Nord Stream 2 gas pipeline, the person said. His successor Olaf Scholz halted the pipeline after Russian President Vladimir Putin decided to recognize two self-declared republics in Ukraine just before announcing the invasion. Merkel’s office could not be reached for comment.

African Union chair to meet Putin on Friday (9:02 a.m.)

African Union Chairman Macky Sall, who is the President of Senegal, will visit Russia this week at Putin’s invitation.

Sall will meet Putin in Sochi on Friday for talks on grain and fertilizer supplies to African countries facing shortages, the Senegalese presidency said in a statement carried by the state news agency. Sall will be accompanied by the head of the African Union Commission, Moussa Faki Mahamat, as part of a “peace mission”, according to Mahamat’s Twitter page.

The African Union also accepted a request from Ukrainian President Volodymyr Zelenskiy to send a video message to the continental body, Sall’s office said.

Slovakia and Poland to sell howitzers to Ukraine (8:49 a.m.)

Slovakia will sell eight Zuzana 2 howitzers to Ukraine, Slovak Defense Minister Jaroslav Nad said in an emailed statement. Poland signed a deal this week to sell about 60 Krab howitzers, Dziennik Gazeta Prawna reported, as Kyiv seeks weapons to repel a Russian offensive in the Donbass region.

Poland to help rebuild Kharkiv region (8:04 a.m.)

Poland will focus on rebuilding Ukraine’s Kharkiv region as different countries step into selected areas to help during the reconstruction, Michal Dworczyk, chief assistant to the prime minister, said in an interview with Polsat News.

Oil Slips on Report Saudis Ready to Increase Production (3:49 a.m.)

Oil fell below $113 a barrel following a report that Saudi Arabia is ready to pump more if Russian production drops significantly due to increased sanctions.

West Texas Intermediate futures fell 3% in Asian trading after closing higher on Wednesday. The Financial Times reported that Saudi Arabia had told Western allies it was ready to boost oil supplies, citing unidentified people familiar with the talks.

Read more: Oil slips on report that Saudi Arabia prepares to increase production, Biden visit

The $1.9 Million Russian Bond, Miss Sparks, Bonanza Exchange (3:14 a.m.)

The Credit Derivatives Determination Committee says a ‘default’ event occurred on credit default swaps because Russia failed to include additional interest in a late bond payment made early of last month.

Although this is a relatively small amount, the missed interest will trigger all of Russia’s outstanding credit default swaps, with the final sum likely to be auctioned. The credit default swaps hedged a net total of $1.5 billion in Russian debt at the end of last month, according to the Depository Trust & Clearing Corp. That compares to $3.2 billion at the end of April.

Read more: Russia’s $1.9m Miss Sparks Credit Swaps Bonanza Bond

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