BP withdraws stake from state-owned Russian oil and gas company Rosneft

British oil giant BP says it will sell all of its shares in Russia’s state-run oil company in the wake of the country’s invasion of Ukraine.

BP said in a statement on Sunday that it will exit its 19.75 percent shareholding in Rosneft valued at €12.6 billion as well as quit all of its businesses with the company in Russia.

BP also said its Chief Executive Officer Bernard Looney and former BP Group Chief Executive Bob Dudley are resigning from Rosneft’s board with immediate effect.

BP said it has operated in Russia for over 30 years. But the firm said, “Russia’s attack on Ukraine is an act of aggression which is having tragic consequences across the region.” It said the military action represents a fundamental change.

The move comes after increased pressure from the UK government and some opposition parties (Liberal Democrats and Plaid Cymru). Earlier this week Extinction Rebellion Ukraine highlighted that the Russian invasion has been “financed by fossil fuels.”

London-based BP also said its CEO, Bernard Looney, and former BP executive Bob Dudley will immediately resign from Rosneft’s board.

“Like so many, I have been deeply shocked and saddened by the situation unfolding in Ukraine and my heart goes out to everyone affected. It has caused us to fundamentally rethink BP’s position with Rosneft,” Looney said in a statement.

BP Chairman Helge Lund said BP has operated in Russia for more than 30 years.

Kwasi Kwarteng, the UK’s secretary of state for business and energy, said he welcomed BP’s decision.

“Russia’s unprovoked invasion of Ukraine must be a wake-up call for British businesses with commercial interests in Putin’s Russia,” Kwarteng said in a tweet.

BP said it will take two non-cash charges in the first quarter to reflect the change, including a €9.9 billion charge for foreign exchange losses that have accumulated since 2013.

Rosneft’s partnerships with Western oil and gas companies have been stymied before.

In 2011, Exxon Mobil, led at the time by future US Secretary of State Rex Tillerson, signed a deal with Rosneft to potentially drill in the oil-rich Russian Arctic. But Exxon ended that partnership in 2017, citing US and European sanctions against Russia.

Meanwhile, the United States and European countries have been stepping up economic sanctions against Russia.

LENS, wire report