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BP stands to make 'blood money' from its stake in Kremlin-backed oil giant Rosneft, Zelenskyy aide says

BP
BP holds a near-20% stake in Russian state-owned Rosneft.Tommy Lee Walker/Shutterstock
  • BP is set to get "blood money" from its stake in a Kremlin-controlled firm, a Zelenskyy aide said.

  • It still owns a near-20% stake in Rosneft after saying in February that it would sell its holding.

  • A BP spokesperson told Insider it had taken a $24 billion hit on its investment in Russia.

One of Volodymyr Zelenskyy's top aides has said that BP stood to make "blood money" from its stake in Kremlin-controlled Rosneft.

In a letter seen by BBC News and The Guardian, the Ukrainian president's economic aide, Oleg Ustenko, accused the oil giant of profiting from its near-20% stake in holding in the Russian company.

A BP spokesperson said it was not making any profit from its Rosneft stake.

Following Vladimir Putin's decision to invade Ukraine in February, BP announced that it would sell its 19.7% holding in Rosneft, but has yet to do so. Two BP-nominated Rosneft board members also stood down from their roles.

Despite sanctions, surging oil prices this year have helped Rosneft deliver bumper half-year profits of $7 billion. Ustenko said that any funds BP received from the Russian company could not be justified.

"This is blood money, pure and simple, inflated profits made from the murder of Ukrainian civilians," Ustenko wrote, per BBC News.

"BP was among the first of the oil majors to announce its intention to exit Russia by selling its stake in Rosneft, the Kremlin's oil company. Yet after nine months of Russian aggression, war crimes and the bombardment of civilian infrastructure, all funded and fueled by Russian oil, gas and coal, BP remains a shareholder in Rosneft."

A BP spokesperson told Insider that the company took a $24.4 billion hit in the first quarter of this year 2022 by writing down the value of its Rosneft stake, while annual profits would be $2 billion lower after removing the contribution from the Russian firm.

"BP is exiting Russia,  we have no intention of returning to 'business as usual'. Just three days after Russia's attack on Ukraine, BP announced that we will exit our shareholding in Rosneft and other businesses in Russia – we said the attack was 'a fundamental change.' This is still our position," the spokesperson added.

BP's ability to sell its holding in Rosneft was complicated by western sanctions on Russian companies since the invasion.

Western governments are still trying to find a way to meaningfully hobble Russia's biggest economic weapon. On Thursday, the EU settled on a $60-a-barrel price cap for Russian crude in an attempt to reduce the Kremlin's ability to profit from selling oil.

Read the original article on Business Insider