Crimea crisis: what does the US know about Putin's oil wealth?
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Version 0 of 1. The most startling part of Washington’s sanctions on Russian businessmen loyal to President Vladimir Putin may be a single sentence that contains an explosive allegation: that Putin himself profits from the world’s fourth biggest oil trading company, Gunvor. Among the people the United States sanctioned on Thursday as part of its drive to put pressure on Russia for its intervention in Ukraine was businessman Gennady Timchenko, a long-time acquaintance of Putin and, until this week, co-owner of Geneva-based Gunvor, which trades nearly 3% of the world’s oil. In announcing the sanctions, the US treasury went a step further, adding a single sentence that hits squarely at one of the most controversial topics that Putin has faced in 13 years as the Kremlin ruler and head of the government. “Timchenko activities in the energy sector have been directly linked to Putin. Putin has investments in Gunvor and may have access to Gunvor funds,” the statement said. The treasury declined further comment on what information it has about Putin’s investments in Gunvor and how exactly he could have access to Gunvor’s funds. It provoked a quick and furious response. Gunvor said the statement was “outrageous” and “blatantly false.” “Gunvor categorically denies that Vladimir Putin has or has ever had any ownership or that he is a beneficiary of our business directly or indirectly,” it said. Gunvor has repeatedly said that Timchenko and chief executive officer Torbjorn Tornqvist had equal stakes each of around 45% and the remaining 10% was owned by the staff. Timchenko has repeatedly denied that Putin helped him create his vast business empire, yet because of his long and close relationship with Putin speculation has persisted. Putin’s spokesman Dmitry Peskov called the sanctions “unacceptable” and said the Kremlin was studying the impact of the inclusion of Timchenko on the list. He did not comment on the allegations that Putin has investments in Gunvor. Later in the day a treasury official clarified that Timchenko’s designation would not affect Gunvor since Timchenko owned less than 50%. At the same time, Gunvor announced that Timchenko had sold his share to Tornqvist on Wednesday, a day earlier. Tornqvist now owns 87%, while 13% belongs to the employees. Still, the growing concern among analysts is that the accusation, and the direct blow at Putin’s closest allies, may provoke an even more dramatic response from Moscow - potentially even using its vast energy supplies as a weapon against the west. The wording of the treasury statement goes far beyond anything that has been said previously about Putin. He has faced accusations for years, typically from political opponents, that he helped Timchenko create the Gunvor empire. None have ever provided any evidence, and no media outlets have ever reported any proof of ownership interests in Gunvor. Putin worked in the mayor’s office in the early 1990s when Timchenko and his friends, Putin said, spun off an oil trading unit of the Kirishi oil refinery. Gunvor has grown spectacularly since then with a turnover of $93bn in 2012 compared with $5bn in 2004. It traded large volumes of oil of Russian state companies such as Rosneft at the end of last decade but since then ceded its leading positions and now focuses on trading in Europe and Asia. According to WikiLeaks cables revealed by the Guardian in 2010, John Beyrle, the former US ambassador to Moscow, reported that Gunvor’s “secretive ownership is rumoured to include prime minister Putin”. A call made by Reuters to Eurasia Foundation, where Beyrle works now after leaving the foreign service, was not answered late on Thursday evening. The first time Putin addressed the issue directly was in 2011. “I assure you, I know that a lot is being written about it, without any participation on my part... I have known the citizen Timchenko for a very long time, since my work in St. Petersburg,” Putin told a group of Russian writers. “I never interfered with anything related to his business interests. I hope he will not stick his nose into my business either,” Putin said. Putin has repeatedly said that he has read in the press reports about his immense wealth and that he was even the world’s richest man but denied those reports as nonsense. “Yes it is true. I’m not only the richest man in Europe but in the whole world. I’m collecting emotions,” he told reporters in 2008. Talk of vast personal riches “is all rubbish.” |