(Bloomberg) — President Vladimir Putin announced countersanctions as countries around the world piled up penalties against Russia’s invasion of Ukraine. The government in Kyiv reported that civilians were killed by shelling in the second-largest city Kharkiv as fighting intensified across the nation.
Britain stepped up its own sanctions, including telling ports not to service Russian-flagged vessels, while Poland warned Moscow may try to seal off part of Ukraine’s border with the European Union.
A Ukrainian delegation led by the defense minister agreed to further talks after meeting with Russian officials on the border with Belarus, while in Kyiv, Ukrainian President Volodymyr Zelenskiy repeated a request for his country to be fast tracked into the EU. Russia’s currency and bonds plunged.
Key Developments
- Ukraine Fighting Intensifies as Prospects for Russia Talks Dim
- Ukraine Wants EU Membership But Accession Often Takes Years
- Russia Erects Financial Defenses as Sanctions Hit Banks, Markets
- Putin’s Nuclear Threat Has West Wondering Again If He’s Bluffing
- China’s Muddled Ukraine Response Feeds Rare Domestic Debate
All times CET:
Kyiv Mayor Calls Situation ‘Difficult and Tense’ (8:49 p.m.)
The situation in Kyiv is “difficult and tense,” according to mayor Vitali Klitschko, who announced a ban on the sale of alcoholic beverages in Ukraine’s capital city from March 1. Air raid sirens were going off about every half hour in Kyiv.
Kharkiv’s mayor, Ihor Terekhov, said residential areas were being shelled. “This is not a military operation,” he said. “This is a war to destroy the Ukrainian people.”
A military unit in Brovary, east of Kyiv, was shelled, resulting in 1 killed and 5 wounded, according to Brovary’s mayor.
Turkey to Restrict Transit of Russian Warships Through Straits (8:31 p.m.)
Turkey has decided to restrict Russian warships from using waterways it controls to transit into the Black Sea due to Putin’s invasion of Ukraine, according to two Turkish officials familiar with the matter.
The officials, who asked not to be named due to the sensitivity of the matter, fleshed out President Recep Tayyip Erdogan’s pledge earlier on Monday to “exercise” the authority over the straits granted to Turkey by the 1936 Montreux Convention to prevent an escalation of fighting.
The Turkish straits give Russia’s Black Sea fleet entry to the Mediterranean. The Montreux agreement allows Ankara to regulate maritime traffic through the waterways during peace and wartime alike. So far, there had been no transit requests from the government in Moscow since the measures came into force, the officials said.
EU Adopts Sanctions on Some of Russia’s Wealthiest Tycoons (8:26 p.m.)
The European Union adopted sanctions on some of Russia’s wealthiest tycoons as the bloc ratchets up penalties on Moscow for its invasion of Ukraine.
The list includes a handful of billionaires who haven’t yet been hit by sanctions in the U.S.: metals tycoon Alisher Usmanov, Alfa Group owners Mikhail Fridman and Petr Aven, plus Alexei Mordashov, who controls a major steel company. Bloomberg first reported the names on Sunday.
The EU is already working on further measures to penalize more oligarchs, according to two people familiar with the plans, who asked not to be identified because the work is private.
Stocks Remained Under Pressure, as Treasuries Jumped (8:16 p.m.)
Stocks remained under pressure, with the S&P 500 falling as much as 1.6% on Monday.
Treasuries jumped, driving two-year yields near where they were before a steeper-than-expected inflation report earlier this month. As traders sought haven assets, the Swiss franc staged its biggest gain against the euro since 2018. Gold held near the more than 13-month high hit last week.
U.S. Prods Crypto Exchanges to Thwart Sanctions Dodgers (7:46 p.m.)
The Biden administration is asking crypto exchanges to help ensure that Russian individuals and organizations aren’t using virtual currencies to avoid sanctions leveled on them by Washington, according to people with direct knowledge of the matter.
The White House’s National Security Council and the Treasury Department have sought help from operators of some of the world’s largest trading platforms to thwart any attempts to sidestep the restrictions levied by the U.S. and its allies after Russia invaded Ukraine last week, said the people. The effort comes as the Biden administration grapples with how to police the asset class amid concerns that tokens can be used to avoid the heavily-regulated traditional financial system.
Spokespeople for the Treasury Department and White House declined to comment on discussions with crypto exchanges. A White House official said that cryptocurrencies aren’t a substitute for the heavily used U.S. dollar in Russia, but that American authorities are aggressively continuing to fight any misuse of digital assets to avoid sanctions.
Putin Retaliates by Banning Foreign Debt Service (6:40 p.m.)
President Vladimir Putin banned all Russian residents from transferring hard currency abroad, including for servicing foreign loan contracts. It wasn’t clear whether the new rules applied to Russia’s sovereign debt and if they constituted default. The central bank put Russia’s total external debt at $478 billion.
The steps, which take effect Tuesday, are part of a package of retaliatory measures for U.S. and European sanctions over his invasion of Ukraine. They also include restrictions on companies buying back their own stock, according to the text of the decree.
Russia Says Ukraine Agreed to Continue Talks (6:15 p.m.)
Russia and Ukraine have agreed to continue talks aimed at ending the war after consulting with their presidents, the Interfax news service reported, citing top officials from the two delegations that met in Gomel, Belarus on Monday.
The Kremlin said Vladimir Medinsky, head of the Russian delegation, may report to President Vladimir Putin later Monday about the talks, according to Interfax. It cited Medinsky as saying the two delegations agreed to meet “in the coming days” on the Polish-Belarusian border.
Mikhail Podolyak, an adviser to Ukrainian President Volodymyr Zelenskiy, also said the two sides had discussed prospects for a second round of talks soon, according to the news service.
U.K. Will Continue to Target Wealthy Russians (6 p.m.)
The U.K. government will continue working through its target list of oligarchs, focusing on their houses, their yachts, and every aspect of their lives, Foreign Secretary Liz Truss told the House of Commons.
More legislation will follow in coming weeks to sanction Russian-occupied territories in the Donbas, extending more sanctions to Belarus, and limiting Russian deposits in U.K. banks, she added.
Northern Cities Kharkiv, Chernihiv Under Fire (5:53 p.m.)
Russian forces moved in on Kharkiv, Ukraine’s second-largest city, where local television footage showed a barrage of missile strikes on a residential neighborhood. At least 11 people were killed and dozens wounded, the regional administration said. Russia has said it doesn’t target civilians.
In the northern city of Chernihiv, civilians were among those killed, according to the state emergency service. Mayor Vitali Klitschko said there were clashes in the city overnight.
Russia Has Yet to Win Air Superiority: U.S. Official (5:45 p.m.)
President Vladimir Putin has now committed almost 75% of his pre-staged forces in Ukraine, according to a senior U.S. defense official. Russia has yet to achieve air superiority, the official said, even as it employs combat power ranging from rockets, missiles and manned aircraft to mechanized forces, artillery and infantry.
Russia’s main advance to encircle the capital, Kyiv, remains slowed because of Ukrainian resistance, and logistics and resupply problems, the official said.
The heaviest assaults were still on Kharkiv as Russia employs siege tactics in its effort to encircle the city, and Ukrainians are using everything from small arms to surface-to-air missiles to resist the invasion, the official said.
Ruble Plunges, Commodities Rise as Sanctions Ramp Up (5:45 p.m.)
Traders struggled to price the ruble as international sanctions shook the country’s financial system. The Russian currency lost a third of its value in offshore trading at one point, its biggest-ever slump. It was down 16% at 98.235 as of 5:59 p.m. in Moscow, compared with 107.0642 on the offshore market — a 22% loss.
The central bank canceled local trading altogether in stocks and bonds as the price of Russian-linked shares and debt tumbled overseas. The latest developments also sent shockwaves through other equity markets, though U.S. and European indexes erased most of their losses through the day. Oil and gas prices pared gains after earlier surges.
U.K. Blocks Russian Ships from Docking at Ports (5:15 p.m.)
U.K. Transport Secretary Grant Shapps has written to all U.K. ports asking them not to provide access to any Russian vessels which are owned, chartered or operated by any Russian citizens or are flying the Russian flag. A spokesman for the Department for Transport could not provide any more details on what the measure would cost the Kremlin or individual Russians.
Ukraine Appeals to EU for Air Defense Systems: Official (4:43 p.m.)
The Ukrainian government has appealed to the EU for military hardware including air defense and anti-missile systems, as well as anti-tank weapons, according to an EU official familiar with the request, who declined to be named amid confidential discussions.
The requests from Kyiv also include howitzers, cannon, mortars, projectile launchers and automatic weapons, the official said. The request comes as the EU agreed to spend 450 million euros to supply military aid, including lethal weapons, to Ukraine.
Ukraine to Issue ‘War Bonds’
Ukraine plans to sell bonds to help fund its military resistance to Russia’s invasion. The auction of the one-year bonds will take place Tuesday, with the proceeds used “to ensure the uninterrupted provision of the state’s financial needs under the war.”
Poland Says Russia May Seek to Block Its Border With Ukraine (3:32 p.m.)
Polish Prime Minister Mateusz Morawiecki warned that Russia may attempt an attack from Belarus down the inside of Ukraine’s western border to block the country off with Poland, saying “we must act quickly” to deliver humanitarian aid.
As many as 100,000 people are expected to cross into Poland from Ukraine on a daily basis, the premier said. The Polish Interior Ministry expects arrivals of refugees from Ukraine to accelerate as Ukrainian border authorities waived exit screening procedures for women and children.
Macron Speaks With Putin by Phone (4:20 p.m.)
French President Emmanuel Macron called Russian President Vladimir Putin to urge him to back an immediate ceasefire in Ukraine, according to the French presidency. He also told Putin to end to all bombardments and attacks against civilians and residential areas and preserve civilian infrastructure, especially roads south of Kyiv. Russia denies targeting civilians.
Macron has repeatedly spoken with Putin in recent weeks to dissuade him from aggression against Ukraine, without positive result. The French leader also spoke with Ukrainian President Volodymyr Zelenskiy several times over the past hours.
Ukraine Urges Halt in Banknote Supply to Russia (3:40 p.m.)
The National Bank of Ukraine reached out to EU and Group of Seven nations, asking them to halt the flow of foreign currency banknotes to Russian and Belarusian banks.
“We hope that our peers and partners will help us exert additional pressure on” Russia and Belarus, Ukrainian Central Bank Governor Kyrylo Shevchenko wrote in a letter seen by Bloomberg News. Belarus hosted Russian troops that entered Ukraine from the north last week.
IOC Calls for Russian, Belarusian Expulsion from Competitions (3:35 p.m.)
The International Olympic Committee asked sports organizations to exclude all Russian and Belarusian athletes and officials from competition around the world. Russia broke the Olympic Truce by invading Ukraine, as did the government of Belarus in its support of the Kremlin, the IOC said in a statement.
The IOC also withdrew the Olympic Order, the highest award of the Olympic Movement, from Russian President Vladimir Putin and repeated its recommendation not to organize any sports events in Russia or Belarus.
U.S., Allies Considering Oil Reserve Release (3:20 p.m.)
The U.S. and its allies are considering a coordinated release of around 60 million barrels of oil from their stockpiles after Russia’s invasion pushed crude prices above $100, according to three people familiar with the matter. While no decisions have been made, the U.S. has been coordinating with International Energy Agency member nations.
Brent oil futures rose 3% on Monday after the latest sanctions raised worries that supply, which is already stretched, will tighten further should Russian flows be disrupted. European natural gas was up 12%, having earlier surged 36%.
Kharkiv Authorities Cite Dead, Wounded in Shelling (3:01 p.m.)
Authorities in Ukraine’s second-largest city, Kharkiv, said heavy shelling in residential areas killed and wounded civilians, according to the Ukrainska Pravda website. “It is a war, a real war,” Kharkiv’s mayor, Ihor Terekhov, told Pravda. Clashes took place in multiple locations in the northeastern part of the city, near the Russian border, after Kremlin-led military units entered Kharkiv on Sunday, Pravda said.
Televised footage shared widely on social media showed a barrage of strikes on a residential neighborhood. Fighting also continued in the suburbs of Kyiv, the capital, as well as the northern city of Chernihiv.
Swiss to Enforce EU Sanctions With ‘Immediate Effect’ (2:55 p.m.)
The Swiss government announced it will enforce EU sanctions against hundreds of Russian lawmakers and other officials including Russian President Vladimir Putin and Foreign Minister Sergei Lavrov “with immediate effect.”
“Assets of the listed individuals and companies are now blocked,” the Swiss government said in a statement. Swiss airspace will also be closed to all aircraft “with Russian markings” from 3 p.m. today, the Swiss government said.
Russia Bans Airlines From 36 Countries From Its Airspace (2:30 p.m.)
Russia banned aircraft from 36 countries from its airspace, including all 27 members of the EU, in retaliation to a similar move from the bloc. The move makes a wide swath of Russia — a key route for travel between Europe and Asian countries such as China, Japan and South Korea — off-limits for carriers including Air France-KLM and Deutsche Lufthansa.
U.K. Says to Expect More Russia Sanctions Shortly (2:30 p.m.)
Prime Minister Boris Johnson told the U.K. cabinet to expect further sanctions on Russia shortly, his spokesman, Max Blain, told reporters in London. The premier is still pushing for Russia to be fully excluded from the SWIFT system of international payments, Blain said.
“You can expect us to have further sanctions on individuals and businesses in the coming days and weeks,” Blain said. “We do think that Russia should be cut out not just economically, but culturally as well.”
Blain said the U.K. estimates that about 100,000 Ukrainians will be eligible to enter the country under plans unveiled by Johnson on Sunday to let in close family members of people already settled in the country.
U.S. Bans Transactions With Russian Central Bank (1:55 p.m.)
The U.S. on Monday banned people and companies from doing business with the Bank of Russia, the Russian National Wealth Fund and the Ministry of Finance. The Treasury Department said the actions effectively immobilize any Russian central bank assets held in the U.S. or by U.S. nationals.
Treasury Secretary Janet Yellen said the measures will “target the funds Putin and his inner circle depend on to enable his invasion of Ukraine.”
France to Target Yachts, Luxury Goods Under EU Sanctions (1:17 p.m.)
The government in Paris will scrutinize all financial assets – including real estate, yachts, luxury vehicles – that may belong to wealthy Russians targeted by EU sanctions, French Finance Minister Bruno Le Maire said after a cabinet meeting in Paris. French authorities will be able to seize the property, he said.
Forbes Russia Says Website Hacked (1:30 p.m.)
Several Russian media outlets, including the state-run Tass news agency and Forbes Russia magazine, displayed messages calling on the people of Russia to stop the war in Ukraine when the sites were accessed by Bloomberg News reporters in Russia. Forbes Russia confirmed to Bloomberg News that its website had been hacked.
Kommersant newspaper’s site also appeared to have been compromised but later was accessible.
Over the weekend at least one government agency confirmed its website came under a DDoS attack, while several other official websites appeared to suffer similar disruptions.
More Than 500,000 Refugees Have Fled Ukraine, UN Official says (10:42 a.m.)
The number of people fleeing Ukraine since Russia’s invasion began has crossed the half-million point, Filippo Grandi, the United Nations high commissioner for refugees, said on Twitter. UN agencies said last week the figure could climb to as many as 4 million.
Most of those have crossed into the EU, where the four member states bordering Ukraine have registered a surge in arrivals. Poland recorded the most at 281,000 since Feb. 24, while Hungarian officials have counted 85,400. Romania puts the number of Ukrainian citizens crossing into the country at 70,000. Slovakia had taken in as many as 35,000 as of Sunday.
Ukraine Asks EU to Accept its Membership Bid (10:51 a.m.)
Zelenskiy asked the EU to immediately accept Ukraine into the bloc. “I am sure it is fair. I am sure we deserve this. I am sure that all this is possible,” he told reporters at a briefing at the presidential office.
Accession to the EU is a long and arduous process, which requires the candidate country to adopt established EU law as well as to enact reforms — including to its judicial and economic systems — to meet the bloc’s criteria. The move also requires the unanimous approval of all EU members, the European Commission and the European Parliament as well as the representatives of all existing member states.
Croatia was the last country to join the EU. It applied for membership in 2003 and was granted it in 2013.
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