Ukraine Update: U.S. Eyes New Sanctions as Ukraine Awaits EU Aid

(Bloomberg) The U.S. is weighing sanctions against Russian nuclear power supplier Rosatom Corp. and the House of Representatives is poised to approve $13.6 billion in aid to Ukraine, which said it also expects European Union assistance to begin arriving next week.

President Volodymyr Zelenskiy again said he's willing to consider some compromises to end the fighting. The Ukrainian leader told Bild TV there's been no direct contact with Russian President Vladimir Putin, and "only after the direct talks between the two presidents can we end this war." 

WATCH: A Russian air strike hit a maternity and children’s hospital in Mariupol, Ukraine on Wednesday, injuring at least 17.Source: Bloomberg

Key Developments

• U.S. Weighs Sanctions on Russian Nuclear Power Supplier Rosatom
• Russian Prowess in Question With Military Bogged Down in Ukraine
• Citi Assessing Its Russia Operations Following Ukraine Invasion
• Xi’s Europe Outreach Aims to Keep China Out of East-West Clash
• Putin Clings to Market Economy as Sanctions Wind Back the Clock
• U.S. Hits China for Pushing Russia’s ‘Preposterous’ Lab Theory

All times CET 

  

Asia Joins Stock Rebound (4:16 a.m.)

Asia stocks joined a global equities rebound as dip-buyers leaned into speculation that weeks of market gyrations may have priced in the economic impact of the conflict in Ukraine. Oil pared a sharp decline. 

The searing commodity markets gains have stalled, though oil has rallied from steep losses overnight to trade just below $110 a barrel.

Blinken, Kuleba Discuss More Humanitarian Help (2:20 a.m.)

Secretary of State Antony Blinken and Ukrainian Foreign Minister Dmytro Kuleba talked about ways to provide the Eastern European nation with more security and humanitarian support, State Department spokesman Ned Price said in a statement.

Biden, Erdogan to Speak Thursday (1:40 a.m.)

President Joe Biden will discuss "developments regarding Russia and Ukraine" in a phone call with Turkish President Recep Tayyip Erdogan on Thursday morning, the White House said. Ukraine's deployment of Turkish-made combat drones in the war has strained ties between Erdogan and Putin. 

IMF Approves $1.4 Billion Emergency Financing for Ukraine (12:20 a.m.)

The International Monetary Fund's board has approved $1.4 billion in emergency financing for Ukraine as Russia's invasion savages the nation's economy.

The funds come from the institution's Rapid Financing Instrument, the IMF said in a statement on Wednesday. While Ukraine's economic outlook is subject to extraordinary uncertainty, the economic consequences of the war are dire, with more than 2 million refugees in less than two weeks and large-scale destruction of key infrastructure, it said.

U.S. Worried Russia May Use Chemical Weapons (11:48 p.m.)

Jen PsakiPhotographer: Al Drago/Bloomberg

The U.S. expressed concern Russia could use chemical or biological weapons in Ukraine after the Kremlin accused the U.S. without evidence of developing bioweapons there.

White House Press Secretary Jen Psaki said in a Tweet that Russia’s accusations were an “obvious ploy†to “justify its further premeditated, unprovoked, and unjustified attack on Ukraine.â€

China has also pushed the theory that the U.S. military has "dangerous" biolabs in Ukraine, mirroring the diversion tactics it used when pressed on the origins of the coronavirus.

Russian Body Reportedly Backs Nationalizing Assets (11:39 p.m.)

The Russian government's legislative commission approved measures Wednesday paving the way for nationalizing property belonging to Western companies leaving the country, Dow Jones reported, citing the country's dominant political party.

Pelosi Signals More Ukraine Aid After $13.6 Billion (11:01 p.m.)

House Speaker Nancy Pelosi, who spoke with Zelenskiy, said he raised the need for future assistance -- including aid for refugees and rebuilding -- that will cost more than the $13.6 billion package now making its way through Congress.

"We are going to have to see what all of us have to do working together, NATO and other countries," Pelosi said. 

A child is carried while fleeing Irpin, on the outskirts of Kyiv on March 9.Photographer: Felipe Dana/AP Photo

U.S. Tells Poland to Forget About Plane Transfer (10:54 p.m.)

U.S. Defense Secretary Lloyd Austin ruled out Poland's proposal to transfer MiG fighter planes to the U.S. for delivery to Ukraine in a phone call Wednesday with his Polish counterpart Mariusz Blaszczak, according to the Pentagon.

U.S. intelligence agencies warned that the Polish plan, which called for the U.S. to replace the MiG fighters with more modern planes, could be viewed as "escalatory" by Russian President Vladimir Putin, according to the Pentagon. 

WATCH: Pentagon’s Kirby says U.S. Defense Secretary Austin ruled out Poland’s proposal to transfer MiG fighter planes to the U.S. for delivery to Ukraine. Source: Bloomberg

Stocks Surge Most Since 2020, Oil Sinks With Bonds (10:05 p.m.)

Global stocks staged a ferocious rebound from the war-induced rout, with European equities notching the biggest rally since the pandemic bottom in March 2020 and U.S. shares jumping the most since June of that year. Oil sank more than 10% and Treasuries dropped in price as investors assessed comments by a top foreign policy aide to Zelenskiy, who said the country is open to discussing Russia's demand of neutrality as long as it's given security guarantees.

U.S. Weighs Sanctions on Russian Nuclear Power Supplier Rosatom (9:30 p.m.)

The Biden administration is considering imposing sanctions on Russia’s state-owned atomic energy company Rosatom Corp., according to people familiar with the matter. No final decision has been made and the White House is consulting with the nuclear power industry about the potential impact.

Rosatom is a delicate target because the company and its subsidiaries account for about 35% of global uranium enrichment, and has agreements to ship the nuclear fuel to countries across Europe. Any punishment would also have to exempt the work Rosatom does with Iran under the terms of the deal limiting the country's nuclear program, which Biden is seeking to revive.

First EU Aid Could Flow to Ukraine Next Week (9:18 p.m.)

The Ukrainian government expects the first tranche of 300 million euros of European Union macro-financial aid as early as next week, Prime Minister Denys Shmyhal said. The second tranche is expected a week later. The EU has approved a 1.2 billion euro aid package for Ukraine.

The IMF board is to consider Ukraine's request for $1.4 billion emergency financing today.

Ukraine, Russia Trade Warnings Over Gas Flows (8:16 p.m.)

Ukraine and Russia exchanged warnings that natural gas flows to Europe may get disrupted by the conflict, with each side trying to distance itself from any responsibility.

Russian Deputy Energy Minister Pavel Sorokin said that "any disruptions or provocations" at gas pumping stations controlled by Ukraine would be that country's responsibility.

Then Sergiy Makogon, the head of Ukraine's Gas Transmission System Operator, said military action is taking place now within gas transit areas, and that the country can's assure operations at the Novopskov and Kupyansk stations if they fall under Russian control. He called for Russian troops to exit the facilities.

Some Evacuations Continue Ahead of Deadline (7:45 p.m.)

Civilian evacuations continued along at least some routes ahead of a cease-fire deadline at 9 p.m. local time. Over a thousand people were evacuated from Energodar to Zaporizhzhia, according to official reports. But a corridor between the Black Sea port of Mariupol and Zaporizhzhia didn't open because of shelling. 

WATCH: Around 700 Ukrainians fleeing the Russian-captured town of Vorzel and part of Irpin were able to escape through a humanitarian corridor.(Source: APTN)

Russia's Progress Still Uneven, U.S. Says (6:03 p.m.)

Russia has yet to achieve total air superiority, as Ukraine's air defense system remains effective, a U.S. official, speaking on condition of anonymity, told reporters. The official also said there's evidence that Russia is dropping "dumb" -- unguided -- bombs over Ukraine.

Russian Inflation Takes Off as Sanctions Bite (5:18 p.m.)

Russia is headed for one of its biggest inflation spikes this century after sanctions triggered the collapse of the ruble and disrupted trade. Overall prices rose 2.2% in the first seven-day period after the invasion began, according to a report by the Federal Statistics Service on Wednesday. That's the sharpest weekly increase since it started tracking the data in 2008 and more than double the previous record.

  

Attacks on Health Facilities in Ukraine Kill 10, WHO Says (5:11 p.m.)

Attacks on health facilities in Ukraine have killed at least 10 people and injured 16, the head of the World Health Organization said.

The WHO has verified 18 attacks on health services including buildings, health workers and ambulances, Director General, Tedros Adhanom Ghebreyesus, said at a briefing in Geneva. Such attacks can be considered war crimes and the WHO is mandated with monitoring potential violations. Zelenskiy also reported on Twitter that a Russian air strike had hit a maternity hospital in Mariupol. 

The WHO has, so far, delivered 81 tons of medical supplies to Ukraine. Hypothermia, frostbite, respiratory diseases, lack of treatment for cardiovascular diseases and cancer, as well as mental health issues are the main health challenges at the moment, the WHO said.

Ukraine Struggles to Evacuate Civilians (4:28 p.m.)

Efforts to move civilians from two towns north west of Kyiv have faltered because Ukrainian officials couldn't reach an agreement with Russian forces to guarantee their safe passage, according to the Facebook page of the Bucha town council. The impasse has left 50 buses stuck on the road. 

Evacuations are under way from a third town near the capital and Sumy near the Russian border. About 1,000 people are leaving Sumy on buses and and another 20,000 are traveling on a fleet of private cars, according to Zelenskiy's deputy chief of staff, Kyrylo Tymoshenko. A humanitarian aid convoy is also heading for Sumy, Tymoshenko said.

WATCH: A convoy of buses bound for Sumy was seen leaving Poltava Oblast, Ukraine, on March 8.Source: Bloomberg

Ukraine Open to Neutrality But Won't Yield Territory (3:51 p.m.)

Ukraine is open to discussing Russia's demand of neutrality as long as it's given security guarantees, though it won't surrender a "single inch" of territory, Ihor Zhovkva, Zelenskiy's deputy chief of staff, said in an interview with Bloomberg Television. 

"Surely, we are ready for a diplomatic solution," Zhovkva, who works on foreign policy, said. Guarantees should come from Ukraine's neighbors, he added, without specifying further. 

There are signs that Russia and Ukraine may hold another round of negotiations soon and their respective foreign ministers are due to meet for talks hosted by Turkey Thursday. 

Ukraine is open to discussing Russia's demand of neutrality as long as it's given security guarantees, a top foreign policy aide to President Volodymyr Zelenskiy said.

Mariupol Siege Traps 400,000, Ukraine's Top Envoy Says (2:27 p.m.)

Even as evacuations proceed elsewhere, Mariupol remained under siege by Russian forces as international organizations have warned this week of a humanitarian crisis there. Ukraine’s foreign minister, Dmytro Kuleba, said in a tweet that some 400,000 are trapped in the city.

Several attempts this week to set up a corridor for civilians lacking services and access to water have failed. 

U.K. Explores Giving Anti-Air Missiles to Ukraine (12:54 p.m.)

Britain is exploring donating anti-aircraft missiles to Ukraine, following a request from the Ukrainian government. 

"We believe that this system will remain within the definition of defensive weapons," U.K. Defense Secretary Ben Wallace said in Parliament on Wednesday. "The missiles will allow the Ukrainian force to better defend their skies."

Russia Should Prioritize Its Wheat Supplies, Premier Says (1:41 p.m.) 

Russian Prime Minister Mikhail Mishustin warned the country should prioritize its own wheat supplies in order to secure bread for its people as grain prices soar.

The comments come as Russia, which vies with the European Union as the world's top wheat exporter, prepares to restrict trade in some goods and raw materials in response to sanctions. It hasn't yet said which materials it may restrict, but Mishustin said Russia would approve details in the near future. 

EU Approves Sanctions on Wealthy Russians, Belarus Banks (1:15 p.m.)

The European Union agreed to expand sanctions over Russia's invasion of Ukraine, targeting 14 Russian businesspeople in the metallurgical, agriculture, pharmaceutical, telecom and digital industries, as well as the Central Bank of Belarus. The bloc is also cutting off three Belarus banks -- Belagroprombank, Bank Dabrabyt and the Development Bank of the Republic of Belarus -- from the SWIFT international payments system.

The latest sanctions round also explicitly makes clear that crypto assets are covered by all the EU sanctions related to Russia and Belarus and adds new limits on the export to Russia of maritime navigation and radio communications technology. 

Russia May Reconsider EU Supply Commitments Amid Sanctions (11:58 a.m.)

Putin's top spokesman said Russia may rethink its energy supply commitments to Europe after international sanctions imposed on the country.

"European leaders unanimously recognize that Russia is fulfilling all its contractual obligations without interruption and in full," Kremlin spokesman Dmitry Peskov told reporters in Moscow. "But you see the hostile Bacchanalia that the countries of the 'collective West' have caused of course makes the situation very difficult and forces us to seriously think about this."

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