West could reduce access to US dollar for Russian companies, says Johnson

Britain’s Prime Minister Boris Johnson speaks during a meeting with Ukraine’s President Volodymyr Zelenskiy (not pictured) at the Munich Security Conference in Munich, Germany, February 19, 2022. Matt Dunham/Pool via REUTERS

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LONDON, Feb 20 (Reuters) – The United States and Britain would seek to cut off Russian companies’ access to U.S. dollars and pounds if the Kremlin orders an invasion of Ukraine, the British prime minister has said. Boris Johnson at the BBC.

“The plan we see is for something that could really be the biggest war in Europe since 1945 just in terms of scale,” Johnson said.

Johnson said sanctions against Russia in the event of an invasion would go far beyond what has been suggested in public.

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He said the UK and US would stop Russian businesses ‘from exchanging pounds and dollars’ – a move he said would ‘hit very, very hard’ with its impact, the BBC reported. .

Britain, home to the center of the world’s currency trade, had threatened to block Russian companies from raising capital in London and expose ownership and corporate ownership if Russia invaded Ukraine.

Russia denies plans to annex another part of Ukraine and President Vladimir Putin says West is stirring up hysteria in crude attempt to lure Russia into war after ignoring Kremlin concerns regarding the enlargement of NATO after the Cold War.

Russia has more than 150,000 troops on the Ukrainian border and the United States, Britain, the European Union and NATO fear Putin is planning to invade in a bid to restore some of the territory and peace. influence lost by Moscow during the collapse of the Soviet Union in 1991. .

Given Russia’s position as one of the world’s leading exporters of oil, gas and metals – priced and settled largely in US dollars – preventing Russian companies from accessing markets in dollars could have a stinging impact.

Putin has repeatedly called for reducing reliance on US dollar trade.

Russia’s largest oil company Rosneft (ROSN.MM) has changed the currency of its contracts entirely from euros to US dollars to protect its transactions from US sanctions, CEO Igor Sechin said in 2019.

Johnson said the government would target Russian banks and businesses. Read more Britain did not say who would fall under the sanctions, but promised there would be nowhere for Russian oligarchs to hide.

Hundreds of billions of dollars have flowed into London and Britain’s overseas territories since the fall of the Soviet Union in 1991, and London has become the Western city of choice for Russia’s super-rich and others. former Soviet republics.

Western intelligence thinks Putin could order an unconventional attack on Ukraine, which could force the West to pass judgment quickly on the imposition of Russian sanctions, a senior Western official said on Friday.

“In this situation, the reality is that it would be more difficult to call exactly when a line was crossed,” the official said. “When we judge that Russia has crossed a line on this … then we have to act quickly and on a large scale in terms of the sanctions response.”

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Reporting by Guy Faulconbridge; Editing by Kate Holton

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