[HN Gopher] BP quits Russia in up to $25B hit after Ukraine inva...
___________________________________________________________________
BP quits Russia in up to $25B hit after Ukraine invasion
Author : vitabenes
Score : 236 points
Date : 2022-02-27 18:42 UTC (4 hours ago)
(HTM) web link (www.reuters.com)
(TXT) w3m dump (www.reuters.com)
| xanaxagoras wrote:
| Is it crazy to think that someone is reimbursing them for this
| loss, like Western governments perhaps? Or maybe its some kind of
| opportunity cost calculation at the behest of some ESG man behind
| the curtain? Not the be too conspiratorial, but I'm trying to
| make sense of walking away from that kind of money, assuming of
| course that this is complete and utter bullshit:
|
| > "I have been deeply shocked and saddened by the situation
| unfolding in Ukraine and my heart goes out to everyone affected.
| It has caused us to fundamentally rethink bp's position with
| Rosneft," BP Chief Executive Bernard Looney said.
| rich_sasha wrote:
| They are probably selling at a heavy discount. Ie making a
| loss.
| olliej wrote:
| I mean the correct action is to require Russia to pay for all
| damages they have caused.
|
| They should be required to pay for the reconstruction of
| Ukraine.
|
| They should be required to compensate Ukrainians for the people
| they choose to kill.
|
| They should be required to disarm, as they have demonstrated
| they are willing to invade peaceful countries, without any
| reason other than a desire to conquer.
| beejiu wrote:
| This follows political pressure in the past few days.
|
| "BP left the meeting with no doubt about the strength of the
| Business Secretary's concern about their commercial interests
| in Russia."
| (https://www.energyvoice.com/oilandgas/europe/390852/bp-
| ceo-r...
|
| That obviously a bit cryptic, but I don't think this decision
| is purely altruistic on BP's part.
| Dwolb wrote:
| Reduction in net income at least, but I don't know their
| finances well enough to know if it's useful.
| trhway wrote:
| imagine in 1945 looking at the pull out of investments in 1939
| from Germany.
| Oberbaumbrucke wrote:
| Yes, everyone's pension fund.
| arbuge wrote:
| > Is it crazy to think that someone is reimbursing them for
| this loss
|
| Yes, that would be pretty crazy. They're taking a loss of up to
| $25B on their books as per their statement today, at the end of
| this quarter.
|
| "Reimbursing" here would mean never disclosing a donation of
| that amount on their books, or laundering it somehow, which
| would be massively illegal besides being impractical.
| xanaxagoras wrote:
| I dunno how impractical it would be. A few no bid contracts
| that overpay and you're pretty much good to go.
| [deleted]
| crate_barre wrote:
| It's not crazy to think that. 25bn can be recompensed in
| alternate contracts by the West. Like hey BP, you are first in
| line for Shale operations we're reopening.
|
| Biden is a hard ass about Russia, and Putin knows it.
| arbuge wrote:
| I don't see how this hurts anyone except BP shareholders.
|
| It certainly doesn't hurt the Russsians in any way I can see. It
| seems to me that some Russian individual or organization, perhaps
| the Russian government itself, will now just scoop up the stake
| in question on the cheap (or for free), at their expense.
| woodruffw wrote:
| We're not privy to the exact reasons for BP's decision, but one
| plausible explanation: if their internal risk analysis
| indicates that their share is going to become worthless, then
| it makes perfect sense for them to divest from it. The
| shareholders take a hit, but it's a small hit compared to
| having that money evaporate entirely.
|
| Besides, given the soaring price of oil, I'm sure they'll find
| a way to make that money back. I'm not exactly worried about
| BP's financial security or that of its shareholders.
| narrator wrote:
| War is bad for business, or is it? There is some deep irony here.
|
| The Russian nationalists just kicked out foreign ownership of
| their oil sector and they didn't even have to deprive anyone of
| their property rights. The foreigners gave up their stake on
| their own initiative.
| stjohnswarts wrote:
| It depends on what business you're in my friend, the military-
| industrial-political complex is certainly watching this with a
| smile and wiping their greedy little hands together in
| anticipation.
| chevman wrote:
| The Russian market is going to zero Monday morning so get out
| while you still can!
|
| Going to be an interesting week :)
| 01100011 wrote:
| Cynical traders will still take the long view and buy the dip.
| AniseAbyss wrote:
| When you're too insane to deal with even for oil companies...
| dev-3892 wrote:
| in what direction does money flow as a result of this?
|
| I'm kind of an idiot when it comes to finance, and to my
| uninformed eyes, this looks to me like a $25bln gain for Rosneft.
| Is that the case?
| Jyaif wrote:
| I believe so. Rosneft being state-own, this looks like a 25
| billion gift to Russia. There must be something that I don't
| understand.
| rlpb wrote:
| In accounting terms, you might consider the stake to have
| been bought for 25 billion at the time, but now it's being
| considered worthless (or maybe even a liability) by BP, so
| something of no (dollar) value is being given to Russia. The
| loss in value might be considered to have occurred as a
| result of recent events.
|
| Edit: note that I have no idea of the value myself. I'm just
| saying that if you were to accept BP's view, then they're not
| necessarily giving Russia a gift of any kind.
| simonh wrote:
| BP still owns the shares, and on the future this could still
| give them a claim against Rosneft so this is not a gift to
| anyone.
| kavalg wrote:
| how so?
| simonh wrote:
| Using laws. Russia has not germ entirely cut off from
| international trade, and the UK government will back up
| BPs interests. Nothings been gifted to anyone, the
| headline is highly misleading.
| ivan_gammel wrote:
| It would be such a gift at current share price. But Rosneft
| will probably become much cheaper.
|
| 1. Their current production capacity in Russia will decline,
| since they won't be able to receive new equipment and spare
| parts.
|
| 2. Their exports capacity may be reduced if more sanctions
| will come.
|
| 3. Their cashflow will be heavily impacted by sanctions. They
| may not be able to receive money or spend them on domestic
| market (eg pay salaries).
|
| 4. Their foreign investments may be frozen or they may be
| forced to sell.
| dchichkov wrote:
| This might be what the current dictator in that country
| wants - reduce the dependency on the imported components.
| And increase the percentage of state ownership of the
| natural resources.
| petre wrote:
| This is probably the last time Putin uses Russia's
| resources to blackmail the EU. That's why he attacked
| Ukraine: he knew the window of opportunity to transform
| it into a Russian vasal state like Belarus is closing
| fast, so he picked the last refuge of the incompetent:
| violence. The EU won't build any ICE vehicles running on
| oil derivates after 2030, China is already ahead of them
| in this sectorand Germany just changed course with its
| plans to use Russian gas as for decarbonization after the
| invasion of Ukraine. China is also going to pay a lot
| less than the EU for Russian gas and there only so much
| pipeline capacity to deliver it. Russia basically just
| became dependent on China economically, just like
| Kazahstan and Mongolia. They have just invested $11.6B in
| a pipeline that will basically sit unused and will waste
| the rest of their dwindling treasury reserves on the war
| effort.
| rnk wrote:
| I wish this was true, but if they wait a few more years
| and do it again but win in 1 or 2 days they could still
| get away with it. I don't see this as their last
| dangerous takeover, as long as Putin is around.
| baq wrote:
| yeah, it isn't $25B anymore.
| Jyaif wrote:
| Of course, but it's not worth $0 either. And when the
| restrictions against Russia are lifted the value will be
| back up.
| selectodude wrote:
| Nowhere, they just abandoned the stake and gave the shares back
| to Rosneft. BP already paid somebody $25bn for the stake years
| ago and they are writing down the value of that stake to zero.
| senko wrote:
| Wher did you read that? I don't see that anywhere in BP
| statement.
|
| What the statement says is they're removing themselves from
| the board (so can't be considered to having any control over
| Rosneft), and readjusting the shares value.
|
| To me this reads as they're going to be a passive investor in
| Rosneft (and possibly sell the shares as quickly as
| possible), not that they're _gifting them to Putin_.
|
| Statement here: https://www.bp.com/en/global/corporate/news-
| and-insights/pre...
| selectodude wrote:
| "The change in accounting treatment also means that bp will
| no longer recognise a share in Rosneft's net income,
| production and reserves"
|
| If they were still a passive investor, they would still get
| a slice of revenue. They're totally divesting.
| kgwgk wrote:
| I don't think that you understand what "change in
| accounting treatment" means.
|
| Usually, when a company owns AAPL shares, for example,
| they do not include in their revenue or net income their
| "share" of Apple's revenue or net income. They just
| consider the value of the shares and the dividends they
| get.
|
| But when some conditions are met they do. From their
| annual report:
|
| Significant judgement: investment in Rosneft
|
| Judgement is required in assessing the level of control
| or influence over another entity in which the group holds
| an interest. For bp, the judgement that the group has
| significant influence over Rosneft Oil Company (Rosneft),
| a Russian oil and gas company is significant. As a
| consequence of this judgement, bp uses the equity method
| of accounting for its investment and bp's share of
| Rosneft's oil and natural gas reserves is included in the
| group's estimated net proved reserves of equity-accounted
| entities. If significant influence was not present, the
| investment would be accounted for as an investment in an
| equity instrument measured at fair value as described
| under 'Financial assets' below and no share of Rosneft's
| oil and natural gas reserves would be reported.
|
| Significant influence is defined in IFRS as the power to
| participate in the financial and operating policy
| decisions of the investee but is not control or joint
| control of those policies. Significant influence is
| presumed when an entity owns 20% or more of the voting
| power of the investee. Significant influence is presumed
| not to be present when an entity owns less than 20% of
| the voting power of the investee.
|
| bp owns 19.75% of the voting shares of Rosneft. Rosneft's
| largest shareholder is Rosneftegaz JSC (Rosneftegaz),
| which is wholly owned by the Russian government. At 31
| December 2020, Rosneftegaz held 40.4% (2019 50% plus one
| share) of the voting shares of Rosneft . IFRS identifies
| several indicators that may provide evidence of
| significant influence, including representation on the
| board of directors of the investee and participation in
| policy-making processes. bp's group chief executive,
| Bernard Looney, was approved as a member of the board of
| directors of Rosneft in June 2020 as one of bp's two
| nominated directors. bp's other nominated director, Bob
| Dudley, has been a member of the Rosneft board since
| 2013. He is also chairman of the Rosneft board's
| Strategic and Sustainable Development Committee. bp also
| holds the voting rights at general meetings of
| shareholders conferred by its 19.75% stake in Rosneft.
| Transactions by Rosneft in its own shares during the year
| have increased bp's economic interest in Rosneft to
| 22.03% (2019 19.75%). bp's management considers,
| therefore, that the group has significant influence over
| Rosneft, as defined by IFRS.
| mxschumacher wrote:
| that does not mean that they are selling their Rosneft
| shares to Rosneft
| selectodude wrote:
| They're not selling their shares to anybody. They're
| abandoning them. Rosneft, for obvious reasons, owns all
| the shares that aren't owned by anybody else so Rosneft
| gets control the shares back.
| kgwgk wrote:
| You seem very confident for someone who doesn't
| understand what he's talking about.
|
| If BP is "abandoning their shares", what do you thing
| that they mean by "the fair value of bp's Rosneft
| shareholding at 31 March 2022"?
|
| "First, it is expected to give rise to a non-cash
| adjusting item charge at the time of the first quarter
| 2022 results, representing the difference between the
| fair value of bp's Rosneft shareholding at 31 March 2022
| and the carrying value of the asset. At the end of 2021
| this carrying value stood at around $14 billion."
| mxschumacher wrote:
| there is simply no information available on what will
| happen to the shares, so your insistence is irritating.
| If the shares were dissolved, the other owners (such as
| the Russian government) would end up with a larger stake.
|
| If a sale is taking place, the question is: to whom and
| for how much (Rosneft shares have been under fire on
| Thursday and Friday, along with all the other Russian
| stocks)
| kasey_junk wrote:
| And a big company dumping their sales on the market would
| add further downward pressure.
|
| It's really odd this threads insistence that shares are
| going to be "given" back to the company as the story
| doesn't say that and it's not what it typically means to
| exit a position.
| senko wrote:
| Divesting usually means selling.
|
| No way in hell they're just giving them back to Rosneft.
| lazide wrote:
| That's not necessarily what that means - it means they're
| not going to attempt to get (or claim on their books)
| anything from Rosneft. If, for example, they never expect
| to get paid any of those amounts (even if technically
| owed them), they would also do that.
| SahAssar wrote:
| Didn't Rosneft then gain whatever those shares are worth now?
| I get that they lost a strategic partnership, but the
| immediate effect is a gain for Rosneft, no?
| ComputerGuru wrote:
| Yes, it's basically a free buyback (reverse effect of stock
| split/dilution).
| spaetzleesser wrote:
| That seems really weird. why give them a free gift? I
| suspect there must be more to this.
| gambiting wrote:
| The gift is worth nothing or actually worse, BP pulling
| out reduces the value of all of their other shares too.
| Tenoke wrote:
| Surely (if that's really the case) just selling on the
| market and crashing the price would've hurt them even
| more. I'd normally expect that'd also make BP at least a
| bit of money but I have no idea about the complex
| accounting and tax situation when doing it this way.
|
| Either way, at minimum it's a gift of not crashing the
| price.
| VBprogrammer wrote:
| In theory perhaps but it's a pretty damning indictment of
| their near term prospects so I would be surprised if they
| gain anything when the dust settles.
| SahAssar wrote:
| In terms of market cap, sure. But isn't part of owning a
| significant chunk of a company some voting power too? If
| the end goal of sanctions is to influence behavior then
| isn't it weird to give up voting power in a business in
| the sanctioned country?
|
| I'm by no means knowledgeable about this stuff, so please
| correct me if I'm wrong.
| lazide wrote:
| For that voting power to exist, you'd need to be able to
| exercise it and/or have someone in the appropriate
| jurisdiction with power who would back up your claim to
| do so.
|
| Realistically, that isn't happening anytime in the
| foreseeable future.
| SahAssar wrote:
| I still don't get how this is a logical path. If BP
| wanted to hurt Rosneft wouldn't keeping the shares but
| announcing that they saw them as worthless except as a
| tool to influence russia be more impactful? Or any other
| path that would indicate their lack of trust in the
| company but still retain a way to influence it if that
| door opened again?
|
| Even if BP considers the shares and the voting power
| completely and utterly worthless the other owners of
| Rosneft apparently don't and giving back the shares gives
| the other shareholders larger ownership of the company
| for free.
| lazide wrote:
| BP, per the article, has not decided what they will do
| exactly - "[...] without saying how it plans to extricate
| itself."
|
| They just don't want to be involved anymore.
|
| Realistically if they keep their shares, they'll get
| hounded by everyone to do said influencing or whatever,
| which would be really irritating for them I imagine. But
| maybe they will put them in a drawer somewhere in the
| basement and tell everyone to screw off. Who knows. They
| say they don't know right now.
| FastMonkey wrote:
| Rosneft is a publicly traded company. When you "exit" a
| position, that usually means you sell the shares onto the
| market. Public shares are traded on a secondary market, so if
| they do that some other investors would be buying them. I
| haven't looked into this story that deeply, but I think it's
| unlikely that they would be striking a good deal with Rosneft
| to sell them directly back to the company. Rosneft may decide
| to buy the shares back from the market itself.
|
| Edit: looking at the BP disclosure, they've decided to make the
| accounting changes that show they're going to sell the stake,
| they'll likely be looking for a smart way to offload the
| shares, probably to some large buyer (not just pressing sell on
| some brokerage account).
|
| Edit 2: the $25B figure isn't really that accurate. Before this
| all kicked off, Rosneft had a market cap of around $70B,and BP
| held about 20%, or $14B. The article sums BP's carrying value
| for the company ($14B, coincidentally I think), and an
| accumulated foreign exchange loss of $11B, which had already
| been charged to equity. The current market cap of Rosneft is
| about $30B,so the actual hit to BP sharebolders will be
| something like $8B if they could sell at current prices.
| lottin wrote:
| So were does the loss come from exactly? Were the shares that
| BP held not marked to market already?
| kgwgk wrote:
| > Were the shares that BP held not marked to market
| already?
|
| No, they were treated using the equity method:
|
| https://en.wikipedia.org/wiki/Equity_method
| lazide wrote:
| In accounting terms, if they already recognized the asset
| at x value, or paid x amount for it, any amount less than x
| is considered a loss.
|
| Depending on what goes on here market wise before they can
| exit their ownership stake (if they haven't already!) is
| what will decide how big a loss this is.
| FastMonkey wrote:
| It's like a loss you would make if you bought a stock for
| $20 and sold it for $18. Someone else buys it for $18 and
| it might go up or down from there. Rosneft got their money
| back when they initially sold the stock to the market.
|
| I think BP is a UK company and I'm not that familiar with
| the specifics of their accounting system. In the disclosure
| they say they considered that they had "significant
| influence" which is an IFRS accounting term. That would
| mean (as simply as I can explain it) that the initial
| purchase is recorded at cost with their share of Rosnefts
| profits and dividends recorded against that holding (along
| with a large bundle of other accounting details).
| ratsmack wrote:
| I think there is an SEC rule that prevents large block trades
| from happening on the open market. Many of these are done
| behind the scenes or during aftermarket hours, but always
| have to be approved by the SEC.
| htrp wrote:
| >I think there is an SEC rule that prevents large block
| trades from happening on the open market
|
| Not quite an SEC rule, just self interest.
|
| You want to get the best price for your stake and your
| options are to liquidate over the course of a few days in
| the open market (in which case word gets out) or private
| placement (usually the best option).
| zaphar wrote:
| BP is not a US company nor is Rosneft. There is no reason
| the sale has to happen on an SEC controlled market. SEC
| rules do not necessarily apply here.
| MrPatan wrote:
| Didn't they just said they couldn't sell it (who'd buy?) and
| they just taking it "off the books" and will just stop claiming
| the money from the dividends?
|
| So now Rosneft gets to keep more money? They did a stock
| buyback for free? That'll learn'em!
| stjohnswarts wrote:
| You got to solute them for this. While they'll get to write it
| off as a loss they still will be paying a lot for this. "Write
| offs" aren't cheap like a lot of the internet seems to think.
| tobyhede wrote:
| BP is probably just getting ahead of the game. The value of this
| investment is likely to be predicted to plummet and need to be
| written off anyway. The EU will need to dramatically reduce
| energy dependence on Russia after this. There will no popular
| support and the long term strategic implications make it
| untenable.
| TedShiller wrote:
| The financially correct way to do it would be to wait for it to
| plummet first before writing it off. So no, you don't want to
| get "ahead of the game" in the accounting sense.
| UnlockedSecrets wrote:
| What are the effects of doing it now versus later?
| baq wrote:
| but it has already happened. show me (or them) a bidder. no
| one in their right mind would buy a russian asset after what
| happened a few hours ago and likely what will happen in
| retaliation.
| mytailorisrich wrote:
| The value of their investment will be known when they find a
| buyer...
|
| I don't see too many organizations interested at the moment.
| Chinese would be the most likely candidates but they may also
| be wary and stay away for the time being. Or they can pretty
| much give their shares away to the Russian government or sell
| them to some Russian organization at a massive discount.
| foobiekr wrote:
| It will take a decade to reduce their energy dependence.
| ajross wrote:
| Less, if Russia resolves its governmental intemperance first.
|
| The events of the last few days make it at least plausible
| that Putin's days are numbered. If so, that's very bad in
| terms of absolute apocalyptic risk, but probably a good thing
| as measured by expected outcome. The chances of getting a
| stable democracy in the next decade might be, I dunno, 40% or
| greater (and those of dying in a nuclear fireball surely
| under 1%, right?). So as geopolitics it's probably a mistake,
| but as investment decisionmaking I think it makes sense.
| trhway wrote:
| >Russia resolves its governmental intemperance first
|
| i see the history of the last 30+ years as clear indication
| that Russian society is progressively becoming less and
| less able to manage large issues. As result i think there
| is high probability that Russia will breakup after that
| catastrophe of Ukraine war similar to USSR after
| Afghanistan (the key to such breakup isn't external forces,
| instead it is clear disillusionment with existing power).
| For example, the Far East in particular has no good
| connection to Russia (and Putin was basically trying to buy
| them up by sending money which will definitely become
| problematic once the war related bills, like compensation
| to Ukraine, start to hit the treasure) while say getting
| high-speed rail Vladivostok-Dalyan/Bejing would include it
| into the Pacific ring of the future boom of economic
| development.
| petre wrote:
| China is already buying off ex Soviet satellites like
| Kyrgystan and Mongolia. Kazahstan is also economically
| dependent on China. If Japan is given any reason to rearm
| itself to the teeth again (like a Chinese invasion of
| Taiwan) and Russia breaks up, they'll almost certainly
| retake Sakhalin and Kurlil islands back. The rest will
| probably all become China satellites, except maybe for
| South Korea.
| rnk wrote:
| I'm hoping that Russia actually attacking Ukraine against
| the strong wishes of the world will cause a similar
| desire to reign in China and protect Taiwan and other
| small country democracies. Strategic ambiguity didn't
| work in Ukraine and it won't work in Taiwan either.
| Eventually China will attack. So let's get over our fear
| there and just sign a mutual defense treaty. Ideally we
| form a NATO of the Pacific with SK, Japan, Australia, NZ,
| and many other small countries. It would drive China bat
| shit insane with anger, but they are just going to do
| what they want eventually unless we get together and stop
| them.
| jmnicolas wrote:
| > The events of the last few days make it at least
| plausible that Putin's days are numbered.
|
| Citation needed. I believe Putin enjoys a very strong
| approval in Russia and I have never read or see anything
| that could disprove it (except from self styled experts
| that are notoriously clueless about everything).
|
| For a comparison there were just hundreds of protestors in
| Moscow on a 12 millions pop. This is nothing.
|
| I visited quite a few Russian blogs with the help of a
| translation plugin, I didn't see anything looking like they
| disapprove, on the contrary most of them ask why it took 8
| years.
| baybal2 wrote:
| > Citation needed. I believe Putin enjoys a very strong
| approval in Russia
|
| His approval rating is as genuine as his 146% election
| victories https://bloknot.ru/wp-
| content/uploads/2016/03/rostovsakaya-1...
| digitalsushi wrote:
| Does someone sharing their opinion that something is
| possible need a citation?
| bnlxbnlx wrote:
| from what i read anti-war protesters in russia get
| arrested. so the threshold to show one's disapproval with
| the invasion is fairly high.
| ozfive wrote:
| Nothing stoping Russians from starting sabotage
| operations internally in protest.
| rich_sasha wrote:
| Russia has basically never had a democratic government,
| perhaps except during the 90s. There is no tradition of it.
| It's current form of government is more like the fiefdoms
| of Tsarist Russia: the Tsar giveth and the Tsar giveth
| away.
|
| Russian may want democracy (though do we know that they
| do?), but there's more than just Putin in the way.
| rsynnott wrote:
| I mean, there was no tradition of democracy in Korea or
| China, but South Korea and Taiwan transitioned reasonably
| successfully to democracy in the 80s and 90s
| respectively. It has been done.
|
| For that matter, a number of Soviet successor states are
| successfully functioning democracies.
| thow-58d4e8b wrote:
| Not sure about South Korea, but Taiwan's democracy is
| kind of a joke. Since the end of the WW2, the grand total
| of the number of parties holding power is...two - DPP and
| KMT.
|
| There are no differences between them in foreign affairs.
| Both favor wage suppression policies. Both favor currency
| manipulation to suppress consumption in order to help
| exporters. None of them is doing anything about the worst
| housing crisis in the world, leading to a demographic
| suicide of the country - fertility rate is below 1.3 for
| 20 years and counting. In many way, it's a choice between
| Pepsi and Coca-cola
| klyrs wrote:
| So, it's a joke largely in the same way that democracy is
| a joke in the united states.
| rnk wrote:
| Agree, the above comment (2 above) was inaccurate,
| extremely misleading. Taiwan is absolutely a free and
| open democratic country as is Korea. It's pretty
| inconceivable that someone who is not a democratic or
| republic candidate would be elected president in the US
| or win congress. Korea has at least been successful at
| convicting previous leaders when they were taking bribes
| or doing other illegal stuff, including the leader of
| Samsung. The US could do a lot better there.
|
| Before the KMT lost power I think it was reasonable to
| see Taiwan as a one party state, but no longer. You are a
| little ambiguous in the "two countries" do things, but I
| guess you mean Korea and Taiwan. Yeah, both countries are
| not paradises that have solved all issues, but they keep
| improving their freedom, industrial bases, and living
| standards for the average person. Is that true for the us
| - we should aspire to do that. Instead we have people
| arguing on school boards whether books that dare to
| discuss slavery or jim crow laws should be discussed at
| all. We aren't clearly moving to be a better society with
| that kind of stuff.
| ozfive wrote:
| Absolutely and Americans are waking up to this fact now
| with a terrorist faction taking power in the Republican
| party.
| Applejinx wrote:
| But would this faction be as terrorist as they are
| without extensive Russian effort to ensure that they are?
| I'm skeptical.
|
| Given that this is hardly unique to the US, I think
| Russia is reaping the whirlwind: they've been up to this
| sort of thing pretty much everywhere. This is not the
| WWIII. They have been waging the WWIII already, this
| whole time, in relatively novel ways, with a lot of
| success... until now.
|
| And it's been the kind of success that is short-sighted:
| got their way again and again at the cost of building
| enormous hostility, which is now rebounding upon them.
| Russia made this bed and all of this is not that much of
| a surprise, really.
| rnk wrote:
| The potential has been there to go way out crazy in the
| Republican party for a long time, remember Pat Buchanan?
| He was a legit threat, but didn't have the crazy wacko
| charisma that Trump has, that dictator tough guy thing
| down that appeals to so many conservatives apparently.
| The thing I suspect Russia did do was take advantage of
| facebook and q-anon type stuff.
| pcwalton wrote:
| South Korea and Taiwan currently have more functional
| democracies than the United States does. The Economist's
| Democracy Index classifies Taiwan and South Korea as full
| democracies, while the US is a flawed democracy:
| https://en.wikipedia.org/wiki/Democracy_Index
| rich_sasha wrote:
| Taiwan, I don't really know about now, but I'm pretty
| sure it wasn't an overnight adoption of democracy in the
| 1940s. It took time, a small few generations, to get to
| that point.
|
| It might be similar in Russia, though I'd imagine the
| heavily entrenched establishment, with massive reliance
| on various police forces, lends itself less to rapid
| democratisation-though you never know.
| oblio wrote:
| Well, you could say that for sure it can be done, because
| we didn't really have democracies before 1776, excluding
| some super short and unstable versions, and democracies
| with universal suffrage are even newer, after about 1900.
|
| According to the Democracy Index, ~75 countries are full
| or flawed democracies, so 75 countries made the leap.
| rich_sasha wrote:
| Most strong democracies were born through a very long and
| drawn out process of democratisation. UK Houses of
| Parliament date back to 13th century; of course at that
| point there was no democracy, but a tradition of open
| debate on government is very old.
|
| In fact in the UK it's probably hard to pinpoint where
| real monarchy ended and democracy started. The monarch
| had less and less power over time, and an increasingly
| wide circle of privileged voters held more and more
| power.
|
| Many struggling democracies had to make that leap much
| more quickly and often the failures of democracy are to
| do with the cultural remains of the previous systems.
| thow-58d4e8b wrote:
| Russia in the 90s wasn't a true democracy either. US
| press liked to depict Yeltsin as a democrat because he
| was weak and subservient, but his methods of power were
| deeply autocratic. Yeltsin ordered artillery shelling of
| the parliament in 1993, killing 140 people. Had elections
| in 1996 been fair, they'd highly likely mean the return
| of the Communist Party to power, so he rigged them in all
| sorts of grotesque ways (naturally, western leaders
| praised him for it). As his incompetence grew more and
| more untenable, he threw the hot potato to Putin and
| resigned
| vkou wrote:
| This is largely accurate - and it's also worth mentioning
| that 90s Russia was an absolute hell-hole.
|
| Whether people approve or disapprove of Putin, a lot of
| them remember what life was like before he became Tsar-
| for-life, and it isn't something that most of them want
| to tangle with again.
| thelittleone wrote:
| Source? Genuinely curious. Surprised EU membership doesnt
| mandate controls on economic dependency.
| qiskit wrote:
| More like as britain takes russian assets via sanctions, the
| russians will offset it by taking british assets. So all
| british assets in russia/ukraine are already lost just like all
| russian assets in britain are lost.
|
| This is just something their PR team put together to get some
| good publicity. Like paying media to rename the "BP oil spill"
| to "Deepwater oil spill". Like branding their company as a
| green eco-friendly after said BP oil spill. Still one of the
| largest oil companies in the world, but they are green eco-
| friendly.
| ryder9 wrote:
| onethought wrote:
| That's not how sanctions work. They aren't seizures, the
| assets just can't be moved. Long term sanctions (like Iran
| and North Korea) might feel like seizures, but technically if
| they were ever lifted the assets have to be returned.
|
| Banks of course can pad their balance sheets with this stuff,
| so I guess that side is seized.
| gruez wrote:
| >This is just something their PR team put together to get
| some good publicity. Like paying media to rename the "BP oil
| spill" to "Deepwater oil spill".
|
| Source? I did some rudimentary checking and what you're
| describing seems like revisionist history and/or conspiracy
| to me. I checked the news section from wikipedia on that
| date[1], and it's referred to as "Explosion on Deepwater
| Horizon drilling rig", with no references to BP (in the
| title, there are references in the body). The linked sources
| also do the same. The same lack of BP reference also applies
| to NPR which had stories from the AP[2] as well as new
| orleans public radio[3]. Maybe BP bribed all of them, but
| that seems hard to believe. Looking at the wikipedia page
| and/or news articles, you can find a less sinister
| explanation for why it wasn't called the BP oil spill: the
| drilling rig was owned and operated by Transocean, not BP.
|
| [1] https://en.m.wikipedia.org/wiki/Portal:Current_events/Apr
| il_...
|
| [2] https://web.archive.org/web/20100421145719/https://www.np
| r.o...
|
| [3] https://www.npr.org/templates/story/story.php?storyId=126
| 183...
| filomeno wrote:
| > There will no popular support and the long term strategic
| implications make it untenable
|
| People just want cheap prices for gas, oil... We don't care too
| much about what happens in Ukraine, we just want to pay our
| bills. Nobody is going to be cold or hungry just to harm
| Russia. Capitalism wouldn't exist otherwise, and capitalism is
| just what the EU is about.
| delegate wrote:
| I think you're not getting the full picture. A dictator with
| thousands of nukes has gone rogue, saying and doing crazy
| things, eg. is unpredictable. Capitalism works in peaceful
| times, it stops when tanks are rolling by.
| filomeno wrote:
| The only thing I remember, is that the only time nuclear
| weapons were used, it was not Russia nor the USSR. To me it
| doesn't look unpredictable at all: Ukraine has long been
| warned that joining NATO poses a threat to Russia and that
| they should remain neutral. Yet they decided to continue to
| provoke Russia (just for the interest of the US) and now
| they get what they were looking for.
| rnk wrote:
| Russia said don't join Nato or we'll destroy you,
| Ukraine. And then Russia attacks Ukraine anyway. So what
| would be different if Georgia, Ukraine, and the other
| smaller democratic survivors of the USSR join NATO?
| Russia will still want to attack them.
|
| Edit - one more thing, Russia said it threatens us if
| NATO is right next door to us in Ukraine. So Russia wants
| to take over Ukraine, and they'll be right next door to
| NATO in Poland. They were already right next door to
| NATO.
| filomeno wrote:
| > Russia said don't join Nato or we'll destroy you,
| Ukraine. And then Russia attacks Ukraine anyway
|
| They wanted some guarantee that Ukraine would remain a
| neutral country, and the response they got was that
| Ukraine was going to join NATO. Even more, NATO's
| secretary general said not only Ukraine can join NATO,
| but also, NATO's presence in eastern Europe was to be
| strengthened. If that was meant to avoid a military
| conflict, I think they were very wrong.
| yrgulation wrote:
| I have a feeling BP will be paid back from a Russian war
| reparations package. Call it a hunch.
| rmbyrro wrote:
| Before that Russia would need to actually lose the war, which
| is highly unlikely, considering Ukraine is fighting on its
| own..
| buitreVirtual wrote:
| BP and others could be still be paid from confiscated
| Russian assets in Europe.
| yrgulation wrote:
| Either that or the bet is that it collapses from within.
| After the soviet union collapsed, russia took over all
| soviet countries debts upon itself, effectively paying
| war reparations. Could be similar now. If there is a coup
| or some dramatic change it would pay some sort of
| penalties for the current war.
| scottLobster wrote:
| Ukraine is fighting with the open support of pretty much
| every advanced military in the developed world. They've got
| armed drones from Turkey, Javelins from the US/UK, the
| freaking EU of all organizations is saying they'll send
| them fighter jets. Even Germany is sending weapons.
|
| Combine that with the apparent intense Ukrainian morale and
| Russian military incompetence/lack of will, Ukraine winning
| is not entirely out of the question. Even if they lose they
| seem fully prepared to commit to an insurgency, which given
| said international support and direct borders with NATO
| would be the best equipped insurgency in history.
|
| Never mind the potential effects of the sanctions, which
| are truly massive in scope.
|
| Ukraine could very well be the rock that breaks Russia's
| teeth.
| sharpy wrote:
| I think we underestimate how much this matters to Russia.
| They might indeed feel there is an existential threat to
| them (the elites, not Russia the country), if they let
| the countries on their periphery join EU/NATO, and become
| democracies, what guarantees do they have that it won't
| happen in Russia, and that a day of reckoning won't come
| for them for looting the motherland?
|
| And given the relative weakness demonstrated by the west
| in recent history (such as abandoning Afghanistan) they
| might judge that in the end, the rest of world won't have
| the stomach for any costly intervention.
|
| Sending the weapons to Ukraine amounts to little, in the
| face of overwhelming Russian military advantage. Given
| the likely goal of establishing pro-Russian government in
| Ukraine, and the long history of association, Russian
| forces are being rather "gentle" compared to what they
| demonstrated elsewhere, but if it comes to it... Ukraine
| cannot win without real support (as in boots on the
| ground) from the west, and nobody wants to contemplate
| that.
| scottLobster wrote:
| Did sending weapons to Afghanistan amount to little, in
| the face of the overwhelming Russian military advantage?
| And Ukraine is a lot closer (physically and culturally),
| and the support a lot more open, than Afghanistan.
|
| As for the Russian Oliagarchs, if their concern was
| eventual revolution in Russia it looks like they may have
| just brought that day closer rather than pushed it out.
| They clearly weren't expecting a response of this
| magnitude, the question is when they choose to cut their
| losses.
| smoe wrote:
| I don't think Ukraine will win a normal war against
| Russia, but will have to shift to more guerrilla warfare
| soon. But on the other hand, is Russia willing to occupy,
| likely for years, the second largest country of Europe
| with a population of 44 million to keep the established
| pro-Russian government actually in power? So far, it
| doesn't look like Ukrainians would just accept a puppet
| president, even if all the mayor cities would have been
| taken.
| hinkley wrote:
| I am going to be shocked if it doesn't come out that
| Poland didn't at least send some consultants in to
| discuss guerilla tactics.
|
| My friend in college was a son of Polish dissidents. He
| didn't like to talk about it in too much depth but I got
| some impressions, and it sounds like his granddad was one
| of those people in the movie they made recently about the
| Polish resistance hiding in the woods during the Cold
| War.
| logifail wrote:
| > the freaking EU of all organizations is saying they'll
| send them fighter jets
|
| For clarity, and despite Macron's urgings, the EU doesn't
| yet have an air force it can send anywhere.
|
| It does have the Common Security and Defence Policy[0]:
|
| "The CSDP involves the deployment of military or civilian
| missions to preserve peace, prevent conflict and
| strengthen international security in accordance with the
| principles of the United Nations Charter. Military
| missions are carried out by EU forces established with
| secondments from the member states' armed forces"
|
| [0] https://en.wikipedia.org/wiki/Common_Security_and_Def
| ence_Po...
| scottLobster wrote:
| https://www.barrons.com/news/eu-countries-to-send-
| fighter-je...
|
| It was the EU "High Representative of the Union for
| Foreign Affairs and Security Policy" speaking for various
| EU members.
| anxrn wrote:
| They appear to have said [1] they'll supply (finance +
| deliver) aircraft (which presumably the Ukrainians have
| the expertise to operate, per [2]). They have not said
| they'll send in an air force (operated by non-
| Ukrainians), which as you point out, they don't yet have.
|
| [1] https://www.reuters.com/world/europe/eu-close-
| airspace-russi... [2] https://www.barrons.com/news/eu-
| countries-to-send-fighter-je...
| petre wrote:
| There are remaining MiG operators in Central and Eastern
| Europe. These planes have been converted to use NATO
| warheads and will be phased out anyway. Ukrainians pilots
| are already accustomed to them.
| NicoJuicy wrote:
| I think winning could be done by 2 ways:
|
| - holding out long enough, if it depleets Russia of
| resources ( aided with sanctions)
|
| - internal protests in Russia ( considering huge amount
| of relatives on both sides), that goes out of control - I
| don't know if this is realistic though. But I think the
| relative factor between those countries ( family members)
| can outwit the propaganda factor
|
| Those Ukranians are though as hell though. I'm sure we
| are seeing a more 'positive' side of them ( if that's
| possible in a war), but they aren't backing down.
| Uttermost respect for their president too. He seems to
| have a deep understanding of how he can reach the world.
| secondo wrote:
| I don't get why're being downvoted. Without doubt a series of
| governments were looped in on this decision - naively
| assuming one or several did not initiate it in the first
| place - to ensure alignment on current matters and there is
| no chance BP did not take the opportunity to ensure alignment
| on future matters.
| ascii_pasta wrote:
| I have a feeling, call it a hunch.
|
| becuase the post adds nothing and is simply a post for the
| sake of posting.
| iandanforth wrote:
| FWIW I hadn't considered there would be a war reparations
| package that would benefit companies like this. So useful
| for the naive/ignorant?
| agumonkey wrote:
| those frozen assets will ease the process I assume
| huhtenberg wrote:
| They were effectively forced to do this by the UK government.
|
| https://www.bbc.com/news/business-60548382
| kristianp wrote:
| https://archive.is/g6uKc
| jka wrote:
| "I have been deeply shocked and saddened by the situation
| unfolding in Ukraine and my heart goes out to everyone affected.
| It has caused us to fundamentally rethink bp's position with
| Rosneft," BP Chief Executive Bernard Looney said.
|
| Narrowing in on the words "fundamentally rethink": I suppose that
| could indicate that BP did not anticipate this series of events
| unfolding, and that this decision to retreat was not planned in
| advance?
| asplake wrote:
| BP was already (Friday) under some political pressure:
| https://www.bbc.co.uk/news/business-60526891
| jfengel wrote:
| An awful lot of people never expected it to get this far. They
| expected it to be a threat to achieve concessions.
|
| The actual attack forces a very broad reconceptualization of
| how Russia intends to relate to the rest of the world. It is
| much more hostile than their previous incursions, because this
| was someone the West considered an ally and possibly even a
| NATO member. This is incredibly dangerous in a way nobody
| expected them to risk.
| prewett wrote:
| I think people paper over the dark side of human nature.
| Sometimes people do bad things not out of ignorance, but out
| of a desire to do bad things. It seemed pretty obvious to me
| that Putin was going to invade: you don't mass 200,000 troops
| on the border and start making justifying noises if you
| aren't planning on invading. Putin followed the pre-invasion
| script of pretty much every invasion in the past couple of
| hundred years that I'm aware of.
| ip26 wrote:
| I doubt many desire to do bad things, but rather desire the
| spoils of bad things & find ways to self-justify.
| olliej wrote:
| Meanwhile Apple, Facebook, Google, Microsoft, Visa, Mastercard,
| ... all continue to do business with them.
|
| "Cool"
| CPLX wrote:
| I've read this a few times and as far as I can tell there's no
| substantive change in ownership planned. It appears to be
| something done entirely as a paper transaction like a journal
| entry.
|
| They are going to write off the investment on the books and no
| longer recognize the associated pass through revenue and so on.
|
| But as far as I can tell they aren't going to _do_ anything. It's
| all an adjustment to financial statements.
|
| If someone more experienced with this kind of public company
| jargon speak wants to come in and correct me then great but
| that's sure what it seems like is happening.
|
| I think it's literally just an internal accounting adjustment.
| FastMonkey wrote:
| They've made the accounting changes that show they may sell.
| Instead of telling investors "we are holding a significant
| portion of rosneft and intend to hold it for the foreseeable
| future", they will now be saying "we hold shares of Rosneft
| that are worth $X on the market, and we will sell them if we
| think we will get a reasonable price".
| rvba wrote:
| This journal entry means a nice tax loss for years to come - so
| no corporate income tax to be paid?
___________________________________________________________________
(page generated 2022-02-27 23:00 UTC)