Ukraine Latest: Yellen Warns Russia Risks ‘Shut In’ of Some Oil

(Bloomberg) --

US Treasury Secretary Janet Yellen said it’s “very likely” that European sanctions will force Russia to offer some of its crude oil exports at a price set by the US and its allies, if Moscow wishes to prevent a shut-in of some supplies. 

“They’re going to be looking for buyers, and we think they’re going to have a hard time selling all of it,” Yellen said Saturday in an interview with Bloomberg News. “Our estimation is there would be some shut-in on Dec. 5 unless they’re willing to accept a price at or below the cap for buyers around the world.”

Russia’s withdrawal from the Ukrainian city of Kherson is an “extraordinary victory” for Kyiv, White House National Security Advisor Jake Sullivan said earlier.

Sullivan added, however, he had not yet verified Russia’s claims that it had pulled its forces from the west bank of the Dnipro River in the Kherson region, abandoning the only regional capital captured in its invasion of Ukraine.

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

Key Developments

• Biden Aide Says Kherson Retreat ‘Extraordinary Victory’ for Kyiv
• Yellen Says Russia Faces Oil Shut-In or Price Cap Amid Sanctions
• Ukraine Leader Hails Kherson Return in Major Blow for Putin

On the Ground

Russia is improving its defense fortifications on the left bank of the Dnipro river and is trying to keep control of the occupied territories, Ukraine’s General Staff said on Facebook. Russian troops are attempting to advance toward Bakhmut, Avdiivka and Novopavlivka in the Donetsk region. Russian forces delivered four missile strikes and 23 air strikes attacking the Kharkiv, Donetsk, Luhansk, Vinnytsya, Kherson, Zaporizhzhia, and Mykolayiv regions.

(All times CET)

Russia Undecided on Extending Grain Deal After Geneva Talks (2:15 p.m.)

Russia hasn’t decided on an extension of the deal allowing exports of Ukrainian grains, which expires next week, Deputy Foreign Minister Sergey Vershinin told reporters following grain talks with the United Nations in Geneva on Friday, according to Tass. He added that the country will consider all circumstances before making a decision and urged the UN to push for implementation of the “Russian part” of the deal, stipulating unimpeded exports of Russian foodstuffs and fertilizer.

Russia will insist on reconnecting its agricultural bank, Rosselkhozbank, to the SWIFT bank payments system, as it is vital to removing obstacles for its agricultural exports, Vershinin said. UN representatives assured Russia that they also consider the issue crucial, he said.

TV and Radio Back in Operation in Kherson (11:05 a.m)

Ukrainian TV and radio services have been restored in Kherson, Ukraine’s special communications service said on its website. Polish company Emitel SA provided the equipment. 

Meanwhile, power distributor Khersonoblenergo started work on resuming supplies to liberated parts of Kherson region and the city of Kherson, the company said on its website.

Ukrainian Navy Says Up to 19 Russian Military Ships are Deployed in the Black Sea (11:00 a.m.)

As many as 19 Russian military ships including one cruise missile carrier with 8 Kalibr missiles are deployed in the Black Sea, the Ukrainian Navy said on Facebook. It said Russia is continuing to violate international maritime conventions and turns off automatic identification systems on civilian ships in the Sea of Azov. 

Separately, Russia banned ships, loaded outside the country, from entering the Sea of Azov via the Kerch Strait, Tass reported, citing Turkish authorities, whom Russians notified of their decision.

Rich Russians Seen Fueling Demand for Caribbean Island Passport (11:00 a.m.)

Vladimir Putin’s military draft following his invasion of Ukraine has triggered a flood of Russians moving to nearby countries with visa-free entry, such as Turkey or Georgia. For some wealthier citizens, an alluring alternative has opened on a faraway island in the Caribbean.

Demand from wealthy Russians looking to flee is helping drive the spike in applications for Grenada’s citizenship by investment initiative, according to Richard Hallam, a special adviser to the program. He estimates they could make up the biggest chunk of applicants this year.

Turkish President Urges ‘Peace Through Dialog’ (10:01 a.m.)

Turkish President Recep Tayyip Erdogan urged talks to bring peace, saying that, with “the US in the lead,” the West attacks Russia “limitlessly” and “against that, Russia puts up resistance.” 

“Our effort is to create a peace corridor from there -- the grain corridor has come into reality,” he told reporters on his way back from Uzbekistan to Istanbul. “The best way for that would be the one that goes to peace through dialog, we think.”

EU Approves €225.6 Million German Aid to Former Gazprom Germania (9:30 a.m.)

The European Commission approved €225.6 million ($233 million) of German aid to support SEFE Securing Energy for Europe GmbH, in a move that will allow the German state to take 100% ownership of the company. The decision aims to safeguard security of gas supplies to the German economy, the European Union’s antitrust arm said in a statement on Saturday. 

Henichesk Becomes Temporary Capital of Russia-Controlled Area (8:15 a.m.)

Henichesk became the new capital of the Russia-controlled areas of the Kherson region after Russian troops withdrew from the city of Kherson, according to the Tass newswire.

Ukraine Urges Asia Leaders to Stop Russia Playing ‘Hunger Games’ (5:38 a.m.)

Ukraine Foreign Minister Dmytro Kuleba urged the Association of Southeast Asian Nations to “take every method possible to stop Russia from playing hunger games with the world” when it comes to the grain corridor.

“Whatever happens on the battleground, Russia should not use this corridor as a blackmail, as the leverage in international relations as it tried to do recently by withdrawing and then returning to the grain initiative under pressure,” he told reporters in Cambodia.

Banksy Reveals Mural on Shelled Ukraine Building (00:01 a.m.)

Secretive graffiti-artist Banksy revealed on his Instagram a mural of a gymnast doing a handstand on a shelled out building, with the caption “Borodyanka, Ukraine.”

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