Glencore to review Russian business interests as fallout from Ukraine invasion intensifies

GLENCORE is to review its business interests in Russia as the fallout from the invasion of Ukraine intensifies across global commodity markets, said Bloomberg News.

Glencore owns a 10.55% stake in En+ Group International PJSC, the controlling shareholder of aluminum giant Rusal. It also owns a small stake of less than 1% in Rosneft, the oil producer. The fair value of the investments at the end of 2021 was $789m and $485m respectively, said Bloomberg citing Glencore 2021 financial statements.

The newswire said Glencore’s review of its Russian interests was “a dramatic turn” as it’s been “long been comfortable operating in the most difficult jurisdictions”. Former Glencore CEO, Ivan Glasenberg was awarded an Order of Friendship by President Vladimir Putin.

“We have no operational footprint in Russia and our trading exposure is not material for Glencore,” the company said in a statement Tuesday. “We are reviewing all our business activities in the country including our equity stakes in En+ and Rosneft.”

The list of companies cutting ties or reviewing their operations has swelled since the weekend as foreign governments ratchet up sanctions against Russia and pile pressure on businesses to cut ties, said Bloomberg News.

Already oil majors BP and Shell have announced plans to sever connections with Russian partners after coming under growing pressure from the UK government.

Glencore’s review is likely to add further turmoil to the aluminum market, with prices for the metal already at a record high, said Bloomberg News. Shipper A.P. Moller-Maersk A/S said it’s halting vessel bookings to and from Russia, deepening supply turmoil for buyers who are already facing critical shortages.