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Ukraine Latest: Finland and Sweden Hand in NATO Applications

Track the latest developments emerging from the Russian attacks on Ukraine.

Ukraine Latest: Finland and Sweden Hand in NATO Applications
Ukraine Latest: Finland and Sweden Hand in NATO Applications

Finland and Sweden handed in their formal applications to join NATO, as Austria’s foreign minister said there’s no fast track for Ukraine to gain European Union membership. 

The US is preparing a military aid package for India that aims at increasing security ties and reducing its reliance on Russian weapons, people familiar with the matter said.

Ukrainian President Volodymyr Zelenskiy broadened his appeals to the outside world by speaking via video link at the opening of the Cannes film festival, where he referenced Charlie Chaplin’s film about Nazi Germany -- “The Great Dictator.”  

WATCH: Sweden and Finland submitted their applications to join the NATO military alliance on Wednesday.Source: Bloomberg
WATCH: Sweden and Finland submitted their applications to join the NATO military alliance on Wednesday.Source: Bloomberg

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

Key Developments

  • Cold War Relic Threatens Europe’s Plans to Ditch Russian Oil
  • US Seeks to Wean India From Russia Weapons With Arms-Aid Package
  • EU Targets Clean Power, LNG in Plan to Slash Russia Dependence
  • US Set to Block Russian Debt Payments, Raising Odds of Default
  • Oil Falls as US to Allow Talks With Venezuela’s State Producer
  • Biden to Host Nordic Leaders in Show of Support for NATO Bids

All times CET:

Finland, Sweden Apply to Join NATO (8:08 a.m)

Sweden and Finland submitted their applications to join the NATO military alliance in Brussels on Wednesday, marking the start of a process that would fortify Europe’s defenses and make it more secure in the event of Russian threats to the region.

“This is a good day at a critical moment for our security,” North Atlantic Treaty Organization Secretary General Jens Stoltenberg told reporters. “This is a historic moment which we should seize.”

Austria Sees No Fast-Track for Ukraine (7:35 a.m.)

Ukraine can’t receive full EU membership in an expedited process and officials should seek to find ways to boost cooperation for the duration of a normal accession talks, Austria’s Foreign Minister Alexander Schallenberg said on German public radio.

“We have every interest to anchor Ukraine in the European family,” Schallenberg said. But we know that an entry process lasts years, if not decades, he said. Austria’s top diplomat said discussions over Ukraine’s membership cannot ignore the aspirations of other countries, including North Macedonia and Albania.

Japan PM to Attend NATO Summit, TV Asahi Says (6:14 a.m.)

Japanese Prime Minister Fumio Kishida plans to attend the NATO summit after a similar meeting of Group of Seven counterparts late next month, broadcaster TV Asahi reported, without attribution. 

Japan, a neighbor of Russia, isn’t a member of the security bloc and Kishida would be the first sitting Japanese premier to attend the gathering.

Read more: Why Japan Will Struggle to Do Without Russian Energy: QuickTake

Australia Imposes More Sanctions (3:11 a.m.)

Australia has sanctioned 11 individuals and 12 entities for promoting Russian propaganda and disinformation, building on the measures already taken against 32 propagandists in March, Foreign Minister Marise Payne said in a statement.

Australia has now sanctioned 827 individuals and 62 entities in response to Russia’s invasion

US Readies Aid Package for India (2:09 a.m.)

The US military aid package under consideration would include military financing of as much as $500 million, according to one person, which would make India one of the largest recipients of such aid behind Israel and Egypt. It’s unclear when the deal would be announced, or what weapons would be included. 

Read more: US Seeks to Wean India From Russia Weapons With Arms-Aid Package

India is the world’s largest buyer of Russian weapons, although it has scaled back that relationship of late. Its dependence on Russia for weapons against neighbors China and Pakistan is a big reason Prime Minister Narendra Modi’s government has avoided criticizing Russian President Vladimir Putin over the war in Ukraine.

Ukraine Latest: Finland and Sweden Hand in NATO Applications

Zelenskiy Addresses Cannes Film Festival (11:25 p.m.)

President Zelenskiy, a former actor and producer, urged the world of cinema to help fight for freedom and battle a “dictator” in his address to the Cannes film festival, citing the need for a new Charlie Chaplin. 

“As then, there is a war for freedom,” he said, adding, “words are needed to sound like in 1940 from all screens of the free world.”

Zelenskiy speaks in a live link-up video during the opening ceremony for the 75th annual Cannes film festival at Palais des Festivals in Cannes, on May 17.Photographer: Andreas Rentz/Getty Images 
Zelenskiy speaks in a live link-up video during the opening ceremony for the 75th annual Cannes film festival at Palais des Festivals in Cannes, on May 17.Photographer: Andreas Rentz/Getty Images 

Separately, in his nightly video address to Ukrainians, Zelenskiy said that efforts to get more fighters out of the Azovstal steel plant continue and “the most influential international middlemen are involved,” without providing details.

US to Block Russia From Repaying Bondholders (9:35 p.m.)

The Biden administration is poised to prevent Russia from being able to make payments to US bondholders, a move that could bring Moscow closer to defaulting on its debt.

The Treasury is expected to let a temporary exemption -- which had enabled Russia to stay current on its payments, lapse after it expires next week, according to people familiar with the matter.

WATCH: US Treasury Secretary Janet Yellen addresses the Brussels Economic Forum.Source: Bloomberg
WATCH: US Treasury Secretary Janet Yellen addresses the Brussels Economic Forum.Source: Bloomberg

EU Weighs Tapping Seized Oligarch Assets to Rebuild Ukraine (9:05 p.m.)

The European Union will propose issuing joint debt and explore using proceeds from assets that were seized from sanctioned oligarchs to fund the reconstruction of Ukraine.

The European Commission will propose on Wednesday to also use fresh grants coming from member states and third countries, according to a draft proposal of the EU’s plan seen by Bloomberg.

Russia Warns Recession Will Last Longer, Tass Says (7:45 p.m.)

Russia is heading into a recession amid high commodity prices for the first time in recent memory, the Economy Ministry said, according to Tass, as sanctions squeeze the economy.

Gross domestic product will contract by 7.8% this year and 0.7% in 2023, according to the Economy Ministry. High energy prices will keep the cash flowing in, with the current account surplus seen reaching a record of $191 billion this year. The ruble’s recent rally is likely to reverse into declines later in the year, while incomes fall and unemployment rises.

The official forecast for the contraction remains milder than those seen by some economists who expect a decline of 12% or more, making this year the worst performance in a generation.

Hungary Outlines Cost to Ditch Russian Oil (5:05 p.m.)

Prime Minister Viktor Orban’s government told EU counterparts that it will cost at least $810 million to revamp Hungary’s oil industry, as Budapest continues to obstruct a block-wide ban on Russian crude.

Hungary said 550 million euros ($580 million) were needed to overhaul its refineries to comply with the ban, and another 220 million euros for a pipeline from Croatia, according to people familiar with EU discussions this week and documents seen by Bloomberg. Additional funds may be needed to adapt to a potential price spike resulting from a ban on Russian imports.

Putin: EU Committing Economic ‘Suicide’ (3:25 p.m.)

Europe will face the highest energy prices in the world over the long term if it rejects Russian supplies, and this could have “irreversible consequences” for much of the continent’s industry, President Putin said, adding that the EU is committing economic “suicide.”

Vladimir Putin chairs a meeting on the development of the oil industry via a video link in Moscow on May 17.Photographer: Mikhail Metzel/AFP/Getty Images
Vladimir Putin chairs a meeting on the development of the oil industry via a video link in Moscow on May 17.Photographer: Mikhail Metzel/AFP/Getty Images

Speaking at a meeting on the development of the oil industry Tuesday, Putin said that energy inflation was due to Europe’s turn away from traditional energy in favor of alternative energy, as well as political measures taken in response to the conflict in Ukraine. “They are trying to blame energy inflation on us, give it our names, blame their systemic mistakes on us,” Putin said.

Biden to Host Leaders of Sweden, Finland (2:45 p.m.)

US President Joe Biden will host Swedish Prime Minister Magdalena Andersson and Finnish Prime Minister Sauli Niinisto on Thursday to discuss the country’s applications to join NATO as well as support for Ukraine, the White House said.

News of the visit comes after Turkish President Recep Tayyip Erdogan said he would oppose the applications over what he said was a willingness by the Nordic nations to host Kurdish militants. The US will “strongly support these applications when they are formally presented in Brussels,” White House press secretary Karine Jean-Pierre said Monday.

Ukraine-Russia Peace Talks Suspended (2 p.m.)

Negotiations are “paused” between Ukraine and Russia, said Mykhailo Podolyak, a member of Ukrainian team. He cited among the reasons the fact that “Russia doesn’t understand that the war is not going according to its schedule or plan.”

Russian Deputy Foreign Minister Andrey Rudenko said that talks were not currently going on in any form after Kyiv essentially withdrew from the process, according to Interfax.

WATCH: Zelenskiy said his government was working to get its remaining troops safely out of the Azovstal steel plant. (Ukrainian with English subtitles.)Source: Bloomberg
WATCH: Zelenskiy said his government was working to get its remaining troops safely out of the Azovstal steel plant. (Ukrainian with English subtitles.)Source: Bloomberg

Gasum Declines to Pay Gazprom in Rubles (1 p.m.)

Finland’s Gasum Oy said it won’t switch to ruble payments required by Russia’s Gazprom, and it will take the companies’ long-term gas supply contract into arbitration.

There’s an increased risk gas flows from Russia into Finland might be halted, the company said. Separately, the EU said that gas companies would violate sanctions if they open bank accounts in rubles to buy Russian gas, but can still purchase the fuel if they follow the bloc’s guidance.

Russian Missiles Strike Railway Near Poland (12:15 p.m.)

The area near the International Peacekeeping and Security Center at Yavoriv in the Lviv region of western Ukraine close to the Polish border came under Russian missile attack, regional governor Maksym Kozytskyi said on Telegram.

The Yavoriv training facility, which had been used regularly by NATO before the invasion, suffered massive damage in March when Russian missiles killed at least 35 people. Missile attacks in the Lviv region have intensified in the past two days after almost a week without air-raid alerts.

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