Ukraine Update: Russia May Be Seeking China’s Help; Talks on Tap

(Bloomberg) --

Russia asked China for military equipment to support its invasion of Ukraine, U.S. officials said, sparking concern in the White House that Beijing could undercut Ukrainian forces' defense efforts.

The U.S. and China plan to hold their first high-level, in-person talks since Moscow's invasion on Monday. An aide to U.S. President Joe Biden warned Russian air strikes shifted further west toward Ukraine's border with Poland, but said there'd been no change in the calculus around a no-fly zone.

A strike at a military range and training center about 35 kilometers (20 miles) from Poland killed dozens Sunday, while an estimated nine civilians died in air strikes on Mykolaiv. Tens of thousands tried to flee fighting in major cities through 10 humanitarian corridors opened by the Ukrainian government.

Key Developments

• Qatar's Foreign Minister to Visit Moscow Over Iran, Ukraine
• Satellite Images of Russian Tanks Fail to Penetrate Fog of War
• Mariupol's Steel Mills Are a War Zone as Staff Huddle in Bunkers
• Companies Leaving Russia Don't Know If and When They'll Return
• U.S. Says Russia Made Unusual Request for Chinese Aid on Ukraine
• How War in Ukraine Is Tearing Apart the Global Food System

All times CET:

Tate Museum Cuts Ties with Russian Billionaires: FT (5:23 a.m.)

The London-based Tate cut links with Russian billionaires Viktor Vekselberg and Petr Aven after they were sanctioned by the U.S. and EU, the Financial Times reported, citing the gallery.

Vekselberg was dropped as an honorary member of Tate Foundation, while Aven stepped down from the Tate donor programs known as the International Council and European Collection Circle. Aven declined to comment to the newspaper. Vekselberg in a letter sent to Tate on Thursday said he was prepared to step down, according to the report.

Akzo Nobel's Russian Operations Could Fold in Weeks (5:12 a.m.)

Dutch paintmaker Akzo Nobel NV expects its Russian operations to collapse in weeks, Chief Executive Officer Thierry Vanlancker told the Financial Times.

Russian operations represent about 2% of the firm's revenue but have been affected by supply chain interruptions and financial strains on customers in Russia, the newspaper reported.

U.K. Facing Inflation, Recession Over War, Says Report (5:05 a.m.)

War in Ukraine risks a second spike in U.K. inflation this fall and increases the likelihood of a recession, according to the Resolution Foundation.

Price growth could exceed 8%, four times the Bank of England's target, the London-based group warned in a report. For poorer households, which spend more on food and energy, inflation could reach over 10%. That would mean the typical family income could drop 4% in real terms in the coming financial year, about 1,000 pounds ($1,304).

Gold Falls for a Second Day (4:43 a.m.)

Gold declined for a second day as investors weighed a likely U.S. interest-rate increase and developments in the war in Ukraine.

Traders are bracing for higher borrowing costs, which would weigh on non-interest bearing bullion. The Federal Reserve is expected to begin tightening on Wednesday with a 25-basis-point move to curb inflation stoked by surging commodity costs amid supply-chain disruptions due to the war.

Australia To Sanction 33 Russian Oligarchs (2:57 a.m.)

Australian announced fresh sanctions on 33 Russian oligarchs, prominent businesspeople and their immediate family members, Minister for Foreign Affairs Marise Payne said in a statement.

Those targeted include Chelsea Football Club owner Roman Abramovich, Alexey Miller, chief executive officer of gas giant Gazprom, and Bank Rossiya chairman Dmitri Lebedev. The measures reinforce Australia's commitment to sanction people of economic and strategic significance to Russia, Payne said.

Ukraine Envoy Calls China-Russia Ties (2:17 a.m.)

Ukraine's ambassador to Japan said China's response to any Russian request for military assistance was an important question. Speaking in an interview with Bloomberg Television, Sergiy Korsunsky added that China's ties with Russia would have consequences for its image and economy, and said he hoped China would be smart enough to understand that.

Power Line Restored at Chernobyl Site (10:15 p.m.)

Ukraine says it restored a power line to the decommissioned Chernobyl nuclear power plant on Sunday, four days after grid electricity to the Russian-controlled site was lost, the International Atomic Energy Agency said in a statement.

The outage forced radioactive waste management sites and other operations at the site of the 1986 reactor disaster to run on generators, raising concern about safety.

Meanwhile, Ukrainian regulators say repairs and maintenance of safety equipment at Chernobyl have halted as the 211 technical personnel and guards suffer from exhaustion after being stuck there since the day before Russian forces entered the site on Feb. 24, according to the IAEA.

Satellite imagery closeup of Chernobyl Nuclear Power Plant on March 10.Source: Satellite image (c) 2022 Maxar Technologies.

Russia Asking China for Military Aid, U.S. Official Says (9 p.m.)

The U.S. official did not specify what kind of equipment Moscow had requested. Russia currently sells far more arms to China than it buys, although Beijing's rapid modernization of its military has seen it producing more advanced weapons in recent years.

The official declined to say how the administration knows these details. White House spokespeople declined to comment.

It's unclear if China would respond positively to any such request. Beijing has stopped short of condemning Russia for its actions in Ukraine but also called repeatedly for negotiations toward a cease-fire and a resolution of the conflict. When Russia annexed Crimea in 2014, China stayed officially neutral.

Beijing usually takes the view that such actions by other countries are their own affairs as long as it does not impinge on its own interests. Providing Russia with weapons specifically to use against Ukraine would risk that veneer of neutrality, in a year when President Xi Jinping is eager for stability at home as he seeks an unprecedented third term.

EU Discussing Sanctions on Chelsea's Abramovich (8:31 p.m.)

The EU is discussing sanctioning the owner of Chelsea Football Club, Roman Abramovich, along with more than a dozen other prominent Russians, according to documents seen by Bloomberg and people familiar with the matter. 

The list -- which still needs to be approved by EU governments and could change before that happens -- also includes Tigran Khudaverdyan, the executive director and deputy CEO of Yandex NV, a Russian internet search engine, and Victor Rashnikov, who owns Magnitogorsk Iron & Steel PJSC, one of Russia's biggest steelmakers.

Roman AbramovichPhotographer: Ben Stansall/AFP/Getty Images

Diplomats aim to finalize the sanctions package, which includes limits on trade in luxury goods and steel, as early as Monday.

Latvia Calls for U.S. Troops in Baltics (7:30 p.m.)

Latvian President Egils Levits called for a permanent U.S. troop presence in the Baltics, calling it a test of American leadership.

NATO has four multinational battalion-size units in Estonia, Latvia, Lithuania and Poland on a rotating basis. Secretary of State Antony Blinken said last week the U.S. hasn't decided whether to permanently base troops in the Baltics.

EL-Erian Says War Effect to Spur U.S. Inflation Higher (6:17 p.m.)

Allianz SE's Mohamed El-Erian said on CBS's Face the Nation that the economic fallout from Russia's invasion is likely to include a further pickup in U.S. inflation, estimating that the rate will peak at every close or above 10% before retreating.

El-Erian also is president of Queens College, Cambridge, and a Bloomberg contributor.

IMF Head Says Russian Default No Longer Improbable Event(5:05 p.m.)

A Russian sovereign default is no longer improbable, though it's unlikely to trigger a global financial crisis, International Monetary Fund Managing Director Kristalina Georgieva said.

In terms of servicing debt obligations, I can say that no longer we think of Russian default as improbable event, Georgieva said on CBS's Face the Nation program.

Kristalina GeorgievaPhotographer: Emily Macinnes/Bloomberg

No Change to Calculus on No-Fly Zone, Sullivan Says (4:19 p.m.)

The U.S. hasn't changed its calculus about a no-fly zone, despite the Russian strike on a military training facility near the Polish border or efforts to try to destroy supply lines, National Security Adviser Jake Sullivan said on NBC's Meet the Press.

"What we will do is increase and intensify our efforts to supply the Ukrainian defenders with the weapons and security assistance they need to defend themselves," he said, adding that the U.S. is coordinating with allies on additional spending on military assistance.

Russia said Saturday it considers convoys of Western military aid legitimate targets.

U.S. Journalist Killed in Shooting Near Kyiv (4:09 p.m.)

An American journalist and filmmaker was shot and killed Sunday covering the war in Ukraine in what may be the first foreign journalist killed in the conflict, according to multiple media and government reports. Brent Renaud, an award-winning filmmaker who'd covered the wars in Iraq and Afghanistan, was shot in Irpin, north of the capital of Kyiv.

Senior U.S. and China Officials to Meet Monday (3:49 p.m.)

Talks in Rome will be the first high-level, in-person talks since the war started. The Biden administration is seeking to enlist China to use its influence on Russia, its ally, to end the crisis. So far Beijing has declined to condemn Moscow for its actions, even as it calls for negotiations to sustain a cease-fire.

National Security Adviser Jake Sullivan will meet with China's top diplomat and Politburo member Yang Jiechi in an effort to "maintain open lines of communication," according to an NSC statement. The impact on regional and global security from the war will be on the agenda, according to a person familiar with the conversation.

U.S. Warns China on Aid to Sanctions-Hit Russia (2:51 p.m.) 

Sullivan said on CNN the U.S. has warned China against helping Russia evade sanctions and is watching the extent to which it provide material support or economic support to Russia.

"We will not stand by and allow any country to compensate Russia for its losses from the economic sanctions," Sullivan said. "Large-scale sanctions evasion or providing support that allows Russia to backfill will have consequences," he said, without elaborating.

U.K. to Streamline Ukrainian Refugee Intake After Criticism

In-person visa applications will be scrapped in favor of online ones. Local authorities will receive 10,000 pounds ($13,000) per refugee to cover costs, while households that commit to hosting Ukrainians for at least six months will get 350 pounds a month, cabinet member Michael Gove told BBC TV.

The government is also considering using the assets of sanctioned Russians to help meet the cost of supporting Ukrainian refugees in the U.K.

Children cram on a bus heading for the border with Poland on March 13.Photographer: Dan Kitwood/Getty Images

Lviv Mayor Calls on U.S. Peers to Help (2:35 p.m.)

The mayor of Lviv in far western Ukraine addressed U.S. mayors on Sunday, urging them to push for more aid to Ukraine and a no fly zone. 

"If you continue influencing your government, if you continue providing assistance, it will accelerate our victory," Mayor Andriy Ivanovych Sadovyi told the National League of Cities conference in Washington. He said the world is witnessing a contest between autocracy and democracy. 

Sadovyi called for a no-fly zone over Ukraine, a move U.S. policymakers have ruled out because it would put NATO forces in direct confrontation with Russia. His remarks were followed by a standing ovation among city leaders from across the U.S. 

Russian Negotiator Says Talks Could Lead to Documents (2:51 p.m.)

The respective delegations have made some progress in talks to stop the war, according to Leonid Slutsky, a senior Russian lawmaker and one of his country's negotiators, the Interfax news agency reported.

"According to my personal expectations, this progress can elevate in a few coming days into a mutual position of both delegations and signing of documents," Slutsky said. He didn't elaborate on what documents may emerge; there have been a variety of ideas put forward on the potential grounds for a cease-fire, even as Russia's bombardment of Ukraine expands westward.

Ukraine President Volodymyr Zelenskiy's chief of staff, Mykailo Podolyak, said on Telegram that Russia has advanced from making ultimatums to listening carefully. "There is a dialogue," he said.

Biden Aide Warns Russia on NATO Encroachment (2:12 p.m.)

Even inadvertent Russian fire onto NATO territory would trigger a response by the military alliance, said White House National Security Adviser Jake Sullivan said. Russia in the past few days has bombed targets increasingly close to Ukraine's border with NATO member Poland.

"All I will say is if Russia attacks, fires upon, takes a shot at NATO territory, the NATO alliance would respond to that," Sullivan told CBS's Face the Nation when asked about how the alliance would view an errant shot on a member country.

Ukraine Continues Mass Evacuations (1:45 p.m.)

Residents cross a destroyed bridge as they evacuate Irpin, northwest of Kyiv, on March 12.Photographer: Sergei Supinsky/AFP/Getty Images

Ukraine opened ten humanitarian corridors on Sunday, some to evacuate people from dangerous locations around Kyiv and six in Ukraine's east, including the a route into besieged Mariupol. Evacuation from Velyka Dymerka to Brovary in the Kyiv region was successfully completed, officials said.

Almost 125,000 people have been moved to safety via the humanitarian corridors so far, President Volodymyr Zelenskiy said in video statement. "Mariupol is key task today. Our humanitarian convoy is two hours from Mariupol, only 80 kilometers," he said. A convoy with 100,000 tonnes of food, water and medications is on the way to Mariupol. 

Russia Says Half of Foreign Reserves Frozen (1:09 p.m.)

Russia has lost access to almost half of its foreign exchange reserves, according to Finance Minister Anton Siluanov. The U.S., European Union and U.K. have imposed sanctions on Russia's central bank over the Ukraine invasion.

"The total volume of our reserves is about $640 billion and there are about $300 billion in such condition that we can't use them now," Siluanov told state television in an interview that aired Sunday. "We see what pressure Western countries put on China to limit our access to reserves in yuan," he added.

Second Mayor in Ukraine's Southeast Said to be Kidnapped (12:20 p.m.)

The mayor of the town of Dniprorudne in Zaporizhzhia region, Yevhen Maveyev, was kidnapped by Russian forces early Sunday, according to a Facebook post by the head of the Zaporizhzhia regional administration, Oleksandr Starukh.

EU High Representative Josep Borrell condemned the abductions on Twitter.

Czechs Ask EU for Help in Refugee Crisis 12:07 a.m.)

The Czech Republic asked the European Union for financial and material help as the country's capacity for accepting Ukrainian refugees is at its limit, said Prime Minister Petr Fiala.

"We have here more than 200,000 refugees and more are to come," Fiala said. The nation of 10.7 million people asked European authorities to provide mobile humanitarian centers that could accommodate tens of thousand of people.

Russia Looks to Install Leaders After Abducting Melitopol Mayor (10:53 a.m.)

Russia is seeking to install a new leader and a committee of chosen ones in the southeastern city of Melitopol after abducting its mayor, Ivan Federov, on Friday.

Local lawmaker Halyna Danylchenko posted a video saying the committee would take charge. Other local officials, including the city's current elected council, have refused to collaborate with Russian forces and residents have protested the occupation, chanting “Melitopol is Ukraine.

Ukraine has said separately that Moscow plans a sham referendum in the occupied southern city of Kherson in a bid to show that residents want to break away from Ukraine. Western intelligence warned before the war that Moscow would try to install puppet administrations if it invaded.

Anti-War Protesters Detained Across Russia (10:40 a.m.)

About 100 people have been detained Sunday at anti-war protests in 17 cities around Russia, according monitoring group OVD-Info. The largest number was in Yekaterinburg, where 24 people were seized by police.

Jailed opposition leader Alexey Navalny called on Russians to come out against the war in the main squares of dozens cities. The protests are considered illegal by Russian authorities, who've detained over 13,000 people nationwide since the attack began. Most of the arrests have taken place in Moscow and St. Petersburg, where demonstrations are planned later on Sunday.

Ukraine Warns Potential Collaborators (10:40 a.m.)

Ukraine's government will criminally prosecute those who collaborate with Russian occupiers by participating with sham local authorities, said President Volodymyr Zelenskiy's chief of staff.

"Any initiatives in the occupied cities in the south of Ukraine, in Kherson, Kakhovka, Henichesk, aimed at holding ‘referendums,’ fictitious sessions of local councils, distributing passports, are absolutely useless," Mykailo Podolyak wrote on Twitter.

Poland Says Close to 1.7 Million Have Crossed Border (10:04 a.m.)

A total of 1.675 million people have crossed into Poland from Ukraine since Feb. 24, including 79,800 on Saturday and another 16,800 early Sunday, border authorities said. President Andrzej Duda said as many as 2.5 million may end up fleeing to Poland, where most refugees are being supported by volunteers.

Russian Missiles Strike Military Range Near Poland (9:16 a.m.)

Russia is targeting additional sites in far western Ukraine, close to the border of NATO member Poland, a likely provocation for the U.S. and NATO allies. 

Dozens of missiles hit the Yaroviv military training center in the Lviv region, regional officials said, killing at least 35 people and wounding 134, Lviv region governor Maksym Kozytskyi said on Telegram. The facility is within an hour's drive of the Polish border. The U.S. has regularly sent military instructors there since 2015 and it's hosted NATO drills, the Associated Press reported. 

The bombing follows strikes on other targets in western Ukraine a day earlier. Some 10 cruise missiles were directed at airfields in Lutsk and Ivano-Frankivsk, to the north and south of Lviv, respectively, officials said.

NATO Chief Reject Absurd Russia Claims (9:00 a.m.)

NATO Secretary General Jens Stoltenberg told the Welt am Sonntag newspaper that the suffering in Ukraine is likely to get worse in the short term.

Jens StoltenbergPhotographer: Valeria Mongelli/Bloomberg

"The coming days are likely to bring even greater hardship," the NATO chief said. He rejected absurd claims by Russia about chemical and biological weapons laboratories in Ukraine, and warned Moscow against attacking Ukraine with weapons of mass destruction under this web of lies.

In Germany, Defense Minister Christine Lambrecht is fleshing out plans to quickly raise the army's combat readiness. Germany can no longer afford overambitious dream projects," she said in an opinion piece for Die Welt. The focus will now be on proven, mature products that are available on the market.

Gazprom Says Transit Via Ukraine Continues (8:59 a.m.)

Russian natural gas supplies to Europe are continuing as usual, Tass reported Sunday, citing Gazprom spokesman Sergei Kupriyanov.

The gas export monopoly is shipping gas via Ukraine and paying transit fees to the country, even after the Russian invasion began over two weeks ago.

Air Serbia to Reduce Moscow Flights After Criticism (8:48 a.m.)

Serbia's flagship carrier will scale back flights to Moscow following criticism it ramped up its schedule after other European airlines halted service.

The Balkan country hasn't joined international sanctions on Russia, although it backed United Nations resolutions condemning the Kremlin's invasion of Ukraine. Announcing the move on Sunday, President Aleksandar Vucic cited unspecified harangues against Serbia and allegations that Air Serbia was profiting by offering Russia travelers a rare loophole to fly into Western Europe via Belgrade.

A Ukrainian soldier with a Next Generation Light Anti-tank Weapon (NLAW) used to destroy a Russian armored vehicle in Irpin, on March 12.Photographer: Sergei Supinsky/AFP/Getty Images

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