Geopolitical tensions scare investors at Moscow’s stock exchange Monday. Big businesses with most of their income from oil, gas and metals in the Russian north take a hard hit.
Petroleum companies are especially sensitive to the current standoff between Kremlin and the West on Ukraine and the broader security situation in Europe. On Monday morning, all the largest companies operating inside the Arctic Circle are sharply down. Gazprom with 11%, Rosneft 8% and Novatek 9%.
After lunch, the stocks were regaining some of the loss.
The Moscow index Moex falls more than 7%. The index is down 16% since the start of the year. The market has been falling for the third month in a row, according to Vedomosti. The business newspaper blames the “geopolitical risks” and reports of “Russia’s allegedly impending invasion of Ukraine.”
Big metal producers, like NorNickel and Severstal, are down 75 and 8%. NorNickel is the largest non-petroleum private company in the Russian Arctic with factories and mines at the Taymyr Peninsula and Kola Peninsula.
Also, the Russian ruble dives, down 2,3% to the US dollar, being at its lowest since 2020. The Central Bank was forced to halt foreign currency purchases Monday in a bid to stop a dramatic slide in the value of the ruble, the Moscow Times reported.
Fears of new sanctions scare away western investors and Russia’s high interest rate caused by high inflation seems to not help the stock market resist the index fall.
The Foreign Ministry in Moscow insists Russia has no intention to invade Ukraine.
Related stories from around the North:
Norway: Norway makes more money on oil than ever, The Independent Barents Observer
Russia: North Russian regions want extension of Arctic shipping route, The Independent Barents Observer
Sweden: Northern Sweden expects population boom from green investments, Radio Sweden
United States: Interior Department report calls for higher oil and gas royalties, Alaska senator Murkowski objects, Alaska Public Media