Gas prices surged more than 10% in Europe after Russia reduced supplies to Germany in retaliation for European sanctions over the invasion of Ukraine. Despite all the sanctions, Russia’s oil revenues have surged 50% so far this year even as many refiners have shunned its supplies, pumping about $20 billion a month into Moscow’s coffers.

NATO chief Jens Stoltenberg said the “accession process would be smooth and swift” should Finland decide to join the military alliance, after Helsinki’s top policy makers threw their weight behind a bid.

Ukraine is negotiating with Russia to arrange an evacuation of heavily wounded soldiers from the besieged Azovstal steel plant in the port city of Mariupol.

Key Developments

  • Russia Curbs Gas Supplies to Germany in Warning for Europe
  • Finnish Leaders Back Joining NATO With Sweden Set to Follow
  • Germany Says Russia Weaponizes Energy as Gas Feud Escalates
  • China Is Spoilt for Choice of Oil as Many Avoid Russian Barrels
  • Russia Oil Revenue Up 50% This Year Despite Boycott
  • Rare Russia Criticism Within China Shows Simmering Policy Debate

All times CET:

U.S. Lawmakers See Finland, Sweden in NATO as Likely (5:05 p.m.)

Leaders of a key U.S. Senate committee described Finland and Sweden joining NATO as almost a done deal. “We’re about to get two new members,” Senator James Risch, the top Republican on the Senate Foreign Relations Committee, said at a hearing Thursday.

Senator Bob Menendez, the panel’s Democratic chairman, said members were “already working to ensure swift consideration” if Finland and Sweden apply to join the military alliance.

Karen Donfried, the assistant secretary of state for European affairs, said Vladimir Putin’s invasion of Ukraine has backfired. “I am struck by how so much of what Putin says he was seeking to avoid he has brought about,” she said. “Finland and Sweden’s interest in NATO is a key example of that.”

Ukraine Seeks to Evacuate 38 Soldiers from Azovstal (4:55 p.m.)

Ukraine is in “very difficult negotiations” to evacuate heavily wounded defenders from the Azovstal steel plant in the city of Mariupol as part of a swap for captured Russian soldiers, Deputy Prime Minister Iryna Vereshchuk said.

“At the moment we are talking about 38 heavily wounded soldiers,” Vereshchuk said. “We are working step by step. Once we swap those 38 heavily wounded, we will move further”

Ukraine managed to evacuate all civilian women, children and the elderly from Azovstal, where they were hiding for weeks under Russian bombardment. Mariupol, home to almost 500,000 people before the war, has been under siege since March 1.

Russia Cuts 3% of Its Flows to Germany (1:40 p.m.)

Russia’s gas supply cut to Gazprom Germania units represents about 3% of Russian flows to Germany, or about 10 million cubic meters per day, German Economy Minister Robert Habeck said Thursday in Berlin. The government will guarantee replacement gas contracts and won’t raise its gas emergency threat level, he said.

The cut is a result of sanctions by Russia announced late Wednesday and is seen as a retaliation against Germany for sanctions over the war in Ukraine and for the seizure of Gazprom PJSC’s units in April. The German government took control of them to secure Europe’s gas supply and is now in talks to finance them.

EU Says Position on Gazprom Payments Unchanged (1:31 p.m.)

The European Commission’s position on Russian gas provider Gazprom PJSC’s proposed payment method “absolutely stands,” commission spokesman Tim McPhie said during a press conference in Brussels.

As the method would involve the Russian central bank, which is subject to sanctions, using it “would be a breach of sanctions,” he stressed. He added that the commission is “very carefully” analyzing letters Gazprom sent to its European clients seeking to reassure them that they can keep paying for gas without breaching sanctions as well as new decrees from the Russian side.

The EU’s executive arm is in discussions with member states on updated guidance but is “not able to put a timeframe” on when this update may be ready, McPhie told reporters.

EBRD Raises 1 Billion Euros to Help Ukraine (1:25 p.m.)

The European Bank for Reconstruction and Development raised 1 billion euros ($1 billion) from its shareholders for Ukraine at its annual meeting, President Odile Renaud-Basso said in Marrakesh, Morocco. The new funds are in addition to the EBRD’s plans to invest 1 billion euros in Ukraine this year.

Stoltenberg Says Finnish Process Would Be ‘Smooth and Swift’ (11:40 a.m.)

NATO Secretary General Jens Stoltenberg said “the accession process would be smooth and swift” should Finland decide to become a member of the military alliance.

“Finland is one of NATO’s closest partners, a mature democracy, a member of the European Union, and an important contributor to Euro-Atlantic security,” Stoltenberg said. “NATO membership would strengthen both NATO and Finland’s security.”

Prime Minister Kaja Kallas said Estonia, a NATO member since 2004, “will make necessary steps quickly” should Finland decide to apply.

EU Considers Boosting Ukraine Arms Financing (11:08 a.m.)

The European Union’s top diplomat, Josep Borrell, is pushing member states to boost the amount of Ukrainian military aid the bloc will finance by 500 million euros ($522 million) to 2 billion euros, said people familiar with the discussions.

Member states have yet to agree to the plan regarding the European Peace Facility, with Germany said to be the main holdout. The facility reimburses governments for military deliveries to Ukraine.

Lukoil Agrees to Buy Russian Downstream Assets of Shell (11:01 a.m.)

Lukoil announced an agreement with subsidiaries of Shell to buy 100% share in Shell Neft, which conducts retail petroleum products sales and lubricants production in Russia, according to a statement.

Russia Oil Revenue Up 50%, IEA Says (10:33 a.m.)

Russia’s oil revenue is up 50% so far this year, even as trade restrictions following the invasion of Ukraine spurred many refiners to shun its supplies, the International Energy Agency said in its monthly oil market report.

Moscow earned roughly $20 billion each month in 2022 from combined sales of crude and products amounting to about 8 million barrels a day, the Paris-based IEA said in its monthly market report.

The European Union is edging toward a ban on Russian oil imports but has yet to get full buy-in from its 27 member states. “If agreed, the new embargoes would accelerate the reorientation of trade flows that is already under way and will force Russian oil companies to shut in more wells,” the IEA said.

Rare Russia Criticism Bubbles Up Within China (9:51 a.m.)

Russian setbacks in Ukraine have begun to prompt more explicit warnings in China about Moscow’s value as a diplomatic partner, in a sign of growing unease over President Xi Jinping’s strategic embrace of Russian President Vladimir Putin.

While China has said it doesn’t support the war, it’s repeatedly defended Putin’s rationale for invading, and opposed U.S.-led efforts to force Russia’s withdrawal.

In that context, a speech by a former Chinese ambassador to Ukraine saying Russia was being “significantly weakened” by the conflict has raised eyebrows in Beijing.

Ukrainian Fighter in Mariupol Appeals to Elon Musk (9:10 a.m.)

One of the Ukrainian fighters holed up at the Azovstal steel plant in the port city of Mariupol has issued a direct plea on Twitter to Elon Musk.

Serhiy Volyna, commander of Ukraine’s 36th Separate Marine Brigade, asked Musk, the world’s richest man, to help arrange safe passage to another country for the defenders surrounded by Russian troops. It comes after Azov battalion officer Illia Samoilenko accused the government in Kyiv of failing in its defense of southern Ukraine, and abandoning Mariupol’s garrison to its fate.

There was no response on Musk’s own Twitter account to the post.

More European Gas Buyers Open Ruble Accounts (9:08 a.m.)

Ten more European gas buyers have opened accounts at Gazprombank JSC, doubling the total number of clients preparing to pay in rubles for Russian gas as President Vladimir Putin demanded.

A total of 20 European companies have opened accounts, with another 14 clients asking for the paperwork needed to set them up, according to a person with knowledge of the situation, who declined to identify the companies.

Finland’s Leaders Support Joining NATO (9:02 a.m.)

Finland’s highest-ranking policy makers threw their weight behind an application to join NATO, expected within a few days. President Sauli Niinisto and Prime Minister Sanna Marin said in a statement Thursday that they favor membership in the North Atlantic Treaty Organization.

“Finland must apply for NATO membership without delay,” they said.

The shift in Finland’s defensive position was spurred by the full-scale war Russia is waging in Ukraine. Neighboring Sweden is also nearing a decision in the coming days and plans to send an application on Monday, Expressen reported on Thursday, citing sources it didn’t identify.

German’s RWE Borrows Billions to Cope With Wild Prices (8:20 a.m.)

German utility RWE AG was forced to borrow billions to cope with wild prices swings as the war in Ukraine deepens Europe’s energy crisis. The energy giant secured a third credit line, boosting its liquidity by 3 billion euros ($3.2 billion) for the next two years, the company said in its earnings report. It now has access to a total of 8 billion euros to help pay down margin calls, the collateral required to back the firm’s trades.

Commerzbank’s War Costs Rise (8:17 a.m.)

Germany’s Commerzbank AG said it expects lending income to increase this year as Polish unit benefits from official rate hikes, helping to offset the cost of putting more cash aside against risks from the war in Ukraine.

China Spoilt for Choice of Oil as Many Avoid Russia (6:48 a.m.)

Chinese oil buyers are spoilt for choice right now even as lockdowns hurt demand as they can opt for everything from discounted Russian crude and sanctioned Iranian oil to regularly-taken Middle Eastern barrels.

Beijing has emerged as one of the beneficiaries of the conflict in Europe, which sparked a surge in crude prices to the highest followed by a period of volatility. Beijing has stood by Moscow since the invasion, effectively clearing the way for refiners in the world’s largest oil importer to discreetly take Russian barrels that are being shunned by the US and UK.

Habeck Says Germany Can Endure Russia Gas Halt (5:00 a.m.)

German Economy Minister Robert Habeck said in an interview with WirtschaftsWoche the ability of Europe’s largest economy to endure a halt “is subject to several preconditions” but it was doable.

He said the country could weather a ban so long as it fills storages, progresses on LNG terminals and cuts consumption. The comments come as Germany is planning four new floating liquefied natural gas projects and fast tracking approvals to slash its dependence on Russian gas.

EU Chief Says Russia Threatens Global Order (4:51 a.m.)

European Commission President Ursula von der Leyen met Japanese Prime Minister Fumio Kishida in Tokyo, where they discussed Russia’s war, which she said was putting the global, rules-based order to the test.

Russia “is today the most direct threat to the world order, with a barbaric war against Ukraine and its worrying pact with China and their call for new and very much arbitrary international relations,” she said at a news briefing.