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Russian stocks tumbled as the ruble fell while oil and gas shares dropped with crude amid concern that Ukraine will be unable to pay for energy imports.

The Micex Index (INDEXCF) fell 0.8 percent to 1,477.35 at 12:50 p.m. in Moscow, its biggest decline in six days. OAO Gazprom, which sends more than half of its European gas exports via Ukraine, dropped 1.8 percent to 146.44 rubles. OAO Bashneft, a regional oil producer, dropped 2.2 percent to 2,105 rubles.

Ukraine can’t pay about $1.6 billion it owes Russia for natural gas because local utilities haven’t paid for supplies in more than a year, Kommersant newspaper said today, citing Ukrainian Energy Minister Eduard Stavytskyi. The one third discount it receives on Russian gas will probably be extended to the second quarter, he was reported to have said. Brent crude slid 0.2 percent to $110.39 in London.

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THE WHITE HOUSE Office of the Press Secretary FOR IMMEDIATE RELEASE March 2, 2014
G-7 Leaders Statement

We, the leaders of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States and the President of the European Council and President of the European Commission, join together today to condemn the Russian Federation’s clear violation of the sovereignty and territorial integrity of Ukraine, in contravention of Russia’s obligations under the UN Charter and its 1997 basing agreement with Ukraine. We call on Russia to address any ongoing security or human rights concerns that it has with Ukraine through direct negotiations, and/or via international observation or mediation under the auspices of the UN or the Organization for Security and Cooperation in Europe. We stand ready to assist with these efforts.

We also call on all parties concerned to behave with the greatest extent of self-restraint and responsibility, and to decrease the tensions.

We note that Russia’s actions in Ukraine also contravene the principles and values on which the G-7 and the G-8 operate. As such, we have decided for the time being to suspend our participation in activities associated with the preparation of the scheduled G-8 Summit in Sochi in June, until the environment comes back where the G-8 is able to have meaningful discussion.

We are united in supporting Ukraine’s sovereignty and territorial integrity, and its right to choose its own future. We commit ourselves to support Ukraine in its efforts to restore unity, stability, and political and economic health to the country. To that end, we will support Ukraine’s work with the International Monetary Fund to negotiate a new program and to implement needed reforms. IMF support will be critical in unlocking additional assistance from the World Bank, other international financial institutions, the EU, and bilateral sources.

Germany’s Chancellor Angela Merkel is reported to have become “really annoyed” about Russian President Vladimir Putin and has questioned whether he “was still in touch with reality.”


The German mass circulation Bild newspaper wrote on Monday that during a telephone conversation she held with US President Barack Obama to discuss the growing crisis in Ukraine she complained that Mr Putin was “living in another world.”


“She appears to have become really annoyed,” Bild remarked. The paper said it had gained inside information on the telephone exchange between the US and German leaders from American sources.