Putin Confident Glencore, Qatar Will Develop Russia Business

  • President held talks with Glasenberg, Al Thani, Messina
  • Rosneft, Glencore studying supply agreements for China, India

Open for business.

Photographer: Dennis Grombkowski/Getty Images

Russian President Vladimir Putin met the heads of global commodities and financial giants on Wednesday and expressed support for their investment and partnership with Russia.

Putin received billionaire Ivan Glasenberg, the chief executive officer of Glencore Plc, as well as Qatar’s sovereign wealth fund head Sheikh Abdullah Bin Mohammed Bin Saud Al Thani and Intesa Sanpaolo SpA Managing Director Carlo Messina in the Kremlin. He thanked them for their roles in the privatization of Rosneft PJSC, whose CEO Igor Sechin also attended.

“I want to express my confidence that your business in Russia will develop and will develop successfully,” Putin said.

The meeting follows Glencore’s $11 billion agreement with the Qatari fund to buy a 19.5 percent stake in Rosneft, Russia’s largest oil producer, using loans from Intesa. The December deal was one of the biggest in the energy industry last year despite attempts by the U.S. and Europe to isolate Russia economically following the annexation of Crimea. The investment helped to narrow Russia’s budget deficit after petrodollars dried up during crude’s collapse.

“The deal is very important to us,” Glasenberg said. There are “a lot of opportunities to work together.”

The global commodities trader and Rosneft are currently studying oil supplies to India and other Asian markets including China, he said.

The December deal meant Rosneft avoided buying back the 19.5 percent stake itself. That would have been seen as “Russia’s demise” in the search for investors, according to Ivan Mazalov, a director at Prosperity Capital Management Ltd., which has $3.5 billion under management.

“It was important for Russia to win a PR battle that Russia is open to do business and that investors consider Russia as a good destination for their capital,” Mazalov said by e-mail.

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