The Ukrainian president’s chief economic adviser, Volodymyr Zelenskiy, has called on BP to leave Russia altogether after the fossil fuel company was offered a £580million dividend by oil giant Rosneft.
Oleg Ustenko has written to BP chief executive Bernard Looney demanding that the British company cut ties with the state-controlled Russian company nine months after announcing its intention to leave the country.
BP has a 19.75% stake in Rosneft, one of the Kremlin’s biggest oil assets. The FTSE 100 company has pledged to end its shareholding at the end of February after Russia invaded Ukraine.
BP suffered an £18.7bn hit by writing the stake off its books, but still owns the shares. Last month, Rosneft boss Igor Sechin said the British company should reconsider the stance and that it had set aside a dividend, in a Russian account, for BP.
In a letter to Looney, seen by the Guardian, Ustenko wrote: “BP was among the first oil majors to announce its intention to leave Russia by selling its stake in Rosneft, the Kremlin oil company.
“Yet after nine months of Russian aggression, war crimes and bombing of civilian infrastructure, all funded and fueled by Russian oil, gas and coal, BP remains a shareholder in Rosneft.”
Ustenko cited analysis by Global Witness which showed the dividend for the first nine months of 2022 was worth around £580million, equivalent to a third of the UK’s direct aid to Ukraine. This year.
“No accounting mechanism or statement from BP will change that fact. It’s blood money pure and simple,” he said.
BP has not released an update on its efforts to sell the stake in Rosneft, which has earned £3.75bn in dividends since 2013. It could prove a tough sell as the West has sanctions against Russia and uncertainty over the regulation of Russian oil. the industry may deter suitors from other countries.
Ustenko said there was “no evidence on which to judge BP’s claims that he is trying to leave Rosneft”. He told Looney: “Your condemnation of the war is welcome. Yet receiving £580million in bloody Russian profits is totally unacceptable.
“Our position is clear: companies must leave Russia or risk being complicit in Russian war crimes. Any European company that continues to profit from Russia’s fossil fuel sector should set up a fund to dedicate that money to Ukrainian war victims.
Labor MP Margaret Hodge said: “Britain is trying to shut down the Russian oil market, but BP is colluding with them. All dividends going to BP should be reallocated by our government to help rebuild Ukraine.
Ustenko has worked to pressure fossil fuel companies to sever ties with Russia in order to damage Kremlin coffers.
Despite efforts to curb the flow of Russian oil to Europe, it emerged last month that the country is now pumping almost as much as before the war began.
A BP spokesperson said: “BP is leaving Russia, we do not intend to resume business as usual. Just three days after the Russian attack on Ukraine, BP announced that we would give up our stake in Rosneft and other companies in Russia – we said the attack was a fundamental change, that is still our position.
BP said the decision cut its reported profits by about $2 billion a year and its oil and gas production by a third.
BP said it had not received any dividends since its decision and any payments to a UK company would go to “a very restricted Russian bank account from which money could not be transferred without Russian government approval. “. BP added that it had “no current expectation of receiving dividends from Rosneft”.
Separately, BP rival TotalEnergies said it plans to cut North Sea investment by 25% next year due to a tougher windfall tax on oil and gas producers.
Total’s UK chairman Jean-Luc Guiziou told Energy Voice he was assessing the impact of “another change to the tax environment for energy investors in the UK” and that the suspended investment amounted to £100million for the next year alone.
