Impose sanctions on refineries that buy Russian crude oil to end war, says Bill Browder | Oil

Bill Browder’s fight against Vladimir Putin has left him facing threats, lawsuits, false murder charges and Interpol arrest warrants. A movie full of disinformation was even made about him.

But 16 years after the death of his friend and lawyer Sergei Magnitsky at the hands of Putin’s regime, Browder remains relentless in his fight for justice. It’s an effort that, he estimates, has cost Putin and his cronies billions of dollars through asset freezes and sanctions. Therefore, there is a serious risk to his safety.

Browder has the restless intensity of a man who made millions as chief executive of Hermitage Capital Management in post-Soviet Russia, but has taken on the even tougher challenge of standing up to the Kremlin.

On a recent visit to the World Economic Forum in the Swiss ski resort of Davos, he went after top executives, European leaders and U.S. senators in an attempt to inflict even more financial trouble on Putin and eventually bring about the collapse of a bloody regime.

Like many experienced Russia observers, he doubts that prolonged attempts to broker a peace deal acceptable to Moscow, Kiev and Washington will succeed.

Putin’s fate rests on war, and Browder says the Russian president has no way out.

“Putin has no ability to stop the war because he started it as a diversionary war against his own incompetence. This is not because there is a real problem with Ukraine. This is not a war.”

“Because there’s a foreign enemy, and he has to be at war so that people won’t get mad at him for the terrible life he’s created for most Russians. And if he stopped the war, he’d lose power. And if he lost power, he’d end up killed.”

“The Ukrainians also cannot stop the war or stop defending themselves because they know they will die.

“When they are invaded, Bucha becomes a model. Ukrainians understand very well that women will be raped, men will be tortured and killed, and children will be kidnapped. Therefore, neither side has the capacity to stop.”

Almost four years later, the intractable nature of Putin’s invasion of Ukraine is clear to most European leaders. Finland’s president, Alexander Stubb, said Russia’s depleted financial reserves, economic stagnation, rising inflation and high interest rates meant Russia would not be able to pay its soldiers when the war ended.

“I worry less about Russia’s capacity to win this war than about Russia’s reluctance to end this war, because it has no power to do so. This war has been a complete strategic failure of President Putin,” Stubb told an audience in Davos.

Browder, who succeeded in imposing sanctions on the Russians involved in Magnitsky’s death in 2012, has been trying for several years to persuade Europe to divert more than $200bn (£146bn) of frozen Russian assets to Ukraine’s defense in 2022.

But as progress on frozen assets has stalled due to objections, primarily from Belgium, there is a new focus: refineries in India, China and Türkiye. These facilities process Russian oil into products such as petrol, diesel and jet fuel, and ensure that dollars flow into the Kremlin’s coffers.

Browder believes the eight refineries are collectively transferring between $500 and $1 billion a day to Russia by purchasing crude oil and is pressuring their owners to impose sanctions.

“This is the clearest thing I’ve ever seen. How does Putin react to this war? And it’s about the sale of crude oil. Who is buying crude oil? There are three countries that are the main buyers: China, India and Turkey.

“If they stopped buying Russian oil, the price Russia could get for their own oil would be sold at a huge discount, given that it was the oil equivalent of blood diamonds. And then, I believe, within six months Putin would be largely bankrupt.”

Attention in recent weeks has focused on Russia’s shadow fleet oil tankers, which carry crude oil but are often protected by opaque layers of ownership. Browder calls this a “really indirect” way of targeting Putin’s sources.

“You either go to the people who are buying the oil and they’re not buying it, or you go to the 200 ships that are carrying the oil and they’re not. It’s easier to take the people.”

There are some signs that some refineries are starting to act: Bloomberg recently reported that deliveries of Russian crude to Indian ports fell to the lowest level in more than three years in December.

Browder, meanwhile, has not given up frozen Russian state assets held primarily by Belgian custodian Euroclear.

Tough negotiations over transferring these assets to Ukraine to help finance the war ultimately hit a roadblock for Belgium. Prime Minister Bart De Wever and Euroclear bosses faced personal threats. Europe agreed in December to lend Ukraine €90bn (£78bn) – but not secured against assets – with the money set to start arriving in April or May.

De Wever insisted at Davos that sending these assets to Ukraine would be a bridge too far: “Europe is not at war with Russia. You can’t just confiscate money. This is an act of war. You shouldn’t underestimate it; there has never been anything like this in history.”

But Browder argues that the Belgian leader puts his personal security above national interests and that sending the money to Ukraine would be an extension of Europe’s current policy of transferring the interest paid on these assets to Kiev.

“No matter what all these 20-point peace plans and negotiations take place, the war will not end,” he says. “And we’ll be sitting here a year from now. We’ll have used up half of that loan and we’ll have to think about what happens next.”

“I’ve been at war with Putin for the last 15 years, I don’t feel good about it, but for my own reasons, I chose to go after them, taking responsibility for the murder of one of my colleagues. This man [De Wever] It has infinitely greater resources.

“So if I can handle it, so can he.”