Glencore Xstrata, the world’s largest commodities and mining group are set to agree a $1bn deal to take an equity stake in Russian oil company Russneft today, despite the threat of war with Ukraine.
The announcement came as stock markets rallied after yesterday morning’s slide, following the end of Russian military manoeuvres near the Ukrainian border.
According to the Standard, Glencore Xstrata’s revenues, at more than a quarter of a trillion dollars last year, are 30% larger than Ukraine’s entire GDP.
The deal highlights how commodities companies view the current conflict and the impact it may have on future business.
Glencore and Xstrata chief executive Ivan Glasenberg said of the stand-off between Russia and Ukraine: “We are all thinking about that. It has taken us by surprise. We have some assets in Ukraine while overall Russia is a large exporter of commodities we are involved in. I don’t know what repercussions we may see. It’s a day-by-day watch. It is politics, we have just got to watch it and react.”