‘Deeply shocking’

(AP):

Major American providers of oilfield services supplied Russia with millions of dollars in equipment for months after its invasion of Ukraine, helping to sustain a critical part of its economy even as Western nations launched sanctions aimed at starving the Russian war effort.

The largest SLB, formerly Schlumberger maintained and even slightly grew its business after others eventually departed. It announced on Friday that it would stop exporting equipment there as The Associated Press (AP) prepared to publish a report on the companies’ Russian operations.

Russia imported more than 5,500 items worth more than US$200 million from the top five US firms in the sector — led by SLB, Baker Hughes and Halliburton in the year following the invasion that began in February 2022. That’s according to customs data obtained by B4Ukraine and vetted by The AP.

The technology helped keep some of the world’s most challenging oilfields operating in a sector that provided nearly half of Russia’s federal revenues in 2021. Baker Hughes and Halliburton wound down their Russian operations several months after the invasion, but until last week, SLB still sold technology there.

It was “deeply shocking to find a US company continuing to supply equipment to Russia’s oil and gas sector”, said Eleanor Nichol, executive director of B4Ukraine, a coalition of more than 80 non-profits calling for multinationals to leave the Russian market.

The AP corresponded with SLB about the exports over several months, beginning in February, and asked the company for final comment on Wednesday. SLB announced two days later it would halt shipments of technology and equipment to Russia from all SLB facilities worldwide. The company said it was “in response to the continued expansion of international sanctions”, including new EU ones at the end of June.

In April, Ukraine categorised SLB as a “sponsor of the war”, a label aimed at deterring banks, investors and customers from doing business with companies still operating in Russia. Agiya Zagrebelska, Ukraine’s sanctions chief, told AP that SLB had benefited financially by remaining in Russia as competitors left.

SLB spokeswoman Moira Duff rejected the idea that SLB’s operations effectively support the Russian war effort. She said SLB voluntarily curtailed some activity starting the month after the invasion.

“Where permitted by evolving international sanctions, we have continued to provide certain products,” Duff said before last week’s announcement.

On Monday, Duff said SLB still has employees in Russia even though it will no longer send equipment there.

Halliburton wound down its Russia operations less than six months after the invasion “while prioritising safety”, spokesman Brad Leone said. Baker Hughes announced the sale of its oilfield services business in Russia last August, six months after the invasion, and completed the deal three months later.