Russian oligarchs the EU is too scared to touch
Let’s say you decided to go sober. And you gave up beer — but continued to drink whiskey. In a nutshell, this is how the European Union’s anti-Russian sanctions work.
The EU has been very outspoken in banning all cars with Russian license plates from crossing its borders. However, Europe still won’t sanction Russian oligarchs and their European businesses, close relatives of Russian security agents, and some of the most hated politicians. So who among the Russian elite is off limits for European bureaucrats?
Firstly, one of the key oligarchs in Putin’s vertical of power, Leonid Mikhelson, a business associate of Putin’s “wallet” Gennady Timchenko. According to the Navalny team’s investigations, Mikhelson bribed Dmitry Medvedev, the head of United Russia, and financed the electoral campaign of State Duma speaker Vyacheslav Volodin. Furthermore, Mikhelson sponsors the projects of Putin’s daughter, Katerina Tikhonova, including the Acrobatic Rock-n-Roll Federation and Innopraktika, up to the point of being a member of its Supervisory Board.
Novatek, a company co-owned by Mikhelson and Timchenko, supplies natural gas to the Ministry of Defense and military enterprises, such as the Sverdlov Plant, which makes explosives, munitions, and FAB-500 bombs Russia uses in Ukraine. The list of their clients also includes SevMash, which builds submarines, and Zababakhin All-Russian Scientific Research Institute for Technical Physics, which specializes in nuclear warheads.
Novatek’s entities support Russian mercenaries fighting in Ukraine through the Muzhestvo Foundation, paying fighters $2,000–3,000 on top of their MoD earnings.
Mikhelson and Timchenko’s other company, Sibur, has been signing deals on the supplies of styrene and diethylene glycol to Kamensky Combined Plant, which produces solid rocket propellant, propellant charges, and rocket engines used in multiple rocket launching systems like the Grad, the Smerch, and the Uragan. Sibur has also supplied styrene and butyl acrylate to the Perm Powder Plant, which produces charges for MLRS and air-defense systems, motor grains for aircraft missiles, launch and boost systems for cruise missiles, and ball powder for firearms.
To date, Mikhelson, Sibur, and Novatek are yet to be sanctioned by the EU. There was a time when Novatek even upped its LNG exports to Europe. Sibur also sells its products to European countries, namely rubber to Austria and ethylene oxide to Italy.
Another exporter of Russia’s natural riches who has continued to operate amidst the war is Vagit Alekperov, the owner of oil giant Lukoil. Before the latest parliamentary election, he joined Mikhelson in the pool of State Duma speaker Vyacheslav Volodin’s main sponsors. Lukoil also pitched in to speed along the construction of the Main Cathedral of the Russian Armed Forces. After Russia invaded Ukraine, Putin decorated Alekperov with the Order of Merit for the Fatherland of the First Class.
Alekperov is doing business in annexed Ukrainian territory and has added a few Crimean vineyards to the list of his assets. Lukoil’s subsidiaries supply fuel to Russia’s Ministry of Defense, the Black Sea Navy, the National Guard, and military enterprises. And yet, the EU has imposed no sanctions on Alekperov or his businesses.
In fact, Lukoil is very active in the West. The company’s oil exports in 2022, when the war was already on, grew by as much as 14%. Admittedly, shipments to Lukoil’s European refineries accounted for most of the growth. The oil giant sells lubricants through its dealer networks in France, Portugal, Germany, Belgium, the Czech Republic, Hungary, Slovakia, Denmark, Sweden, Norway, and Malta. Moreover, Lukoil has a strong Austrian presence, with Vienna hosting the company’s European head office.
Another Russian oligarch who does business in Europe while sponsoring Russia’s ruling party is Vladimir Lisin. His enterprise, Novolipetsk Steel (NLMK), finances the Center for Humanitarian and Political Technologies, an organization United Russia’s strategists use to distribute campaign funds. NLMK also supplies steel to Russian nuclear weapons developers.
In Europe, Lisin owns manufacturing facilities in Belgium, Denmark, France, and Italy — NLMK Clabecq (Belgium), NLMK DanSteel (Denmark), NLMK Verona (Italy), NLMK La Louviere (Belgium), NLMK Strasbourg (France), and NLMK Manage Service Center (Belgium) — with a total headcount bordering on 2,000 employees. Lisin is not under any European sanctions and is therefore free to vacation at his French villas.
Oligarch Vladimir Potanin, whose Nornickel owns a plant in Finland (Nornickel Harjavalta), isn’t on the sanctions list either, despite his public acclamations of love for Vladimir Putin. In Russia, Potanin’s Normetimpex supplied nickel to the Salyut Machine-Building Production Association, Rostec’s subsidiary that manufactures engines for fighter jets.
Rusal shareholder Viktor Vekselberg has also been avoiding European sanctions, even though he supplies aluminum powder and stampings to Russian weapons manufacturers. Rusal hasn’t been affected by sanctions and continues to sell foil to the Czech Republic, for one.
Oligarchs Iskandar Makhmudov and Andrei Bokarev, whose Russian wealth stems from corrupt schemes and supplies of engines for Russian warships, co-own a plant in Latvia. They aren’t on the EU’s sanctions list either.
The sanctions are also yet to hit Vladimir Yevtushenkov, who has hired Ksenia Shoigu, the daughter of Russia’s defense minister, as a managing partner of his investment fund. Meanwhile, Yevtushenkov’s enterprises profit from defense contracts. Thus, Progress has signed deals for navigation systems for the army, while his other entities have been providing microchips, transistors, and other electronic components to almost a hundred defense enterprises spanning a wide range of weapons systems and military technologies.
One of the richest Russians, Aras Agalarov, advocates for Putin’s lifelong tenure, wins multi-billion government contracts from the Kremlin without a tender, cooperates with United Russia, and even made a splash in the U.S. election interference scandal, but is yet to appear on any Western sanctions list.
The same goes for Albert Avdolyan, the partner of Russia’s main defense corporation, Rostec, and a personal friend of Rostec CEO Sergey Chemezov’s. Another close associate of Chemezov’s, Sergei Adonyev, also feels at ease in Europe.
The list of unsanctioned Russian oligarchs with corrupt ties to the government goes on and on. Take God Nisanov with his connections to the foreign intelligence chief Sergey Naryshkin. Alexey Repik, who is developing the territory of occupied Mariupol. Sergey Gordeev, who finances Russia’s military personnel. Igor Yusufov, who has served as Dmitry Medvedev’s personal “wallet”.
The family members of Russian securocrats and politicians, who like vacationing in Europe, own businesses and properties in the EU and have also dodged the sanctions. This includes Anastasia Zadorina, the daughter of an FSB general, who parties in Courchevel with Russian government contract money. The family of Russia’s Foreign Intelligence Service chief Sergey Naryshkin. The son of Russia’s Minister of Defense Sergei Shoigu. The relatives of Roscosmos chief Yury Borisov, who used to oversee weapons production. MP Pavel Fedyaev’s aunt and brother. Alla Nalcha, MP Dmitry Sablin’s wife. The children of MPs Alexey Chepa, Anatoly Vyborny, Valentina Tereshkova, and Andrei Skoch, Federation Council speaker Valentina Matvienko, senators Vyacheslav Timchenko and Vladimir Dzhabarov.
