On September 12, 2014, due to continued Russian efforts to destabilize eastern Ukraine, US Treasury sanctioned several Russian companies, including Gazprom and Gazprom Neft. Russian giant Gazprom is a government-owned global energy company engaged in gas exploration, production, transportation, storage, processing, and sales. It is the largest company in Russia by revenue. A subsidiary of Gazprom, Gazprom Neft is Russia's third-largest oil producer, engaged in the exploration, development, production, transportation, and sale of crude oil and gas.
The sanctions were extended to other subsidiaries of the energy giant and to Gazprom management in April 2018, December 2019, and February 2022.
Russia went to a US friend to avoid US sanctions
US sanctions on Gazprom have had an unanticipated effect. The United Arab Emirates, a self-declared "close friend and close ally of the United States," has become a key storage and trading hub for sanctioned Russian oil companies, including Gazprom.
By Spring 2023, Russia accounted for more than 1 in 10 barrels of gas oil stored in Fujairah, the UAE's main oil storage hub. In November 2022, a cargo of 700,000 barrels of Arctic crude oil loaded by Gazprom was delivered to a refinery of the Abu Dhabi National Oil Company (ADNOC), the Wall Street Journal wrote, quoting Kplere data (https://www.wsj.com/) In a regulatory disclosure issued in April 2023, Gazprom announced that is setting up a Middle East unit. No details were revealed. (https://www.reuters.com/)
ADNOC-Gazprom comprehensive strategic agreement
For decades, Russian and Emirati oil companies were in competition. To avoid Western sanctions, Kremlin found a new business friend: the state-owned oil company of a petrostate, the Abu Dhabi National Oil Corporation (ADNOC).
On October 15, 2019, Russia's President Vladimir Putin and Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, witnessed the signing of several agreements and memoranda of understanding between the UAE and Russia in Abu Dhabi.
Sultan Al Jaber, Minister of State of the United Arab Emirates and CEO of ADNOC, signed an agreement marking the first time a Russian company has joined an energy production project in the UAE: ADNOC awarded LUKOIL a 5% stake in the Ghasha ultra-sour gas concession. In addition, an Agreement on future cooperation concerning the Ghasha concession was signed between LUKOIL, ADNOC, and the Russian Direct Investment Fund (RDIF) (https://www.opensourceinvestigations.com/)
On the same day, October 15, 2019, in the presence of Putin and Al Nahyan, ADNOC signed a "comprehensive strategic framework agreement" with Russia's Gazprom Neft to explore new opportunities to collaborate in the upstream and downstream sectors, as well as in AI and other technologies. As part of the agreement, Gazprom Neft and Adnoc "will jointly explore opportunities for collaboration in Abu Dhabi's exploration and production concessions."
The strategic agreement was signed by ADNOC's Sultan Al Jaber and Vladislav Baryshnikov, member of the management board and Deputy CEO for International Business Development of Gazprom Neft.
Sultan Al Jaber and Vladislav Baryshnikov presenting the agreement to Putin and Al Nahyan (Credit: UAE Minister of Presidential Affairs)
"This comprehensive framework agreement with Gazprom Neft is a natural evolution of the close and deep bilateral relations between the UAE and Russia, and provided a foundation to strengthen and expand the strategic energy relationship between both countries," ADNOC CEO said. Sultan Al Jaber added that "it also further demonstrates how ADNOC is leveraging world-class partnerships to create, unlock, and maximize value from our substantial assets and resources for the benefit of the UAE and our partners."
Let the right one in
The groundwork for the ADNOC partnership with Russia's oil and gas giants was laid during two meetings between Sultan Al Jaber and a key Russian minister, Alexander Novak.
On July 10, 2019, Sultan Al Jaber, Minister of State of the UAE and CEO of ADNOC, met with Alexander Novak, Minister of Energy of the Russian Federation, during a visit to Moscow. (Novak – later appointed Deputy Prime Minister in 2020 – has been subject to US sanctions since September 2022).
Al Jaber (right) with Alexander Novak in Moscow (Credit: The Ministry of Energy of the Russian Federation)
The parties discussed several issues of bilateral energy cooperation, particularly in the field exploration, oil and gas production, and LNG. AL Jabar announced that "ADNOC is open to exploring partnership and co-investment opportunities with Russian energy companies across the full value chain, where they make economic sense and drive significant returns for both sides."
Two months later, on September 11, 2019, Al Jaber and Novak met again in Abu Dhabi.
Novak with Al Jaber at ADNOC headquarters in Abu Dhabi (Credit: ADNOC)
During the visit, Novak was given a tour of Abu Dhabi and visited ADNOC's Panorama digital command center. "Building on the strong bilateral relationship, which exists between the UAE and Russia, there is significant potential for further collaboration on energy issues," Al Jaber said.
How close is Sultan Al Jaber to Russia
During the last years, Sultan AL Jaber has played a major role in the UAE-Russia partnership.
On November 17, 2021, Sultan Ahmed Al Jaber (appointed Minister of Industry and Advanced Technology in July 2020) signed a memorandum of understanding with Denis Manturov, Russian Minister of Industry and Trade, to bolster industrial collaboration in hydrogen fuel technology. (Manturov has been a critical member of Putin's ministerial team. Manturov is sanctioned by both the United States and the United Kingdom, with London describing him as being "responsible for overseeing the Russian weapons industry and responsible for equipping mobilized troops" in the war on Ukraine)
Denis Manturov and Sultan Al Jaber in Abu Dhabi (Credit: Ministry of Industry and Advanced Technology of the UAE)
The partnership includes a joint assessment of solutions for assisting in manufacturing, storing, and transporting hydrogen fuel. Russia and the UAE will also create international hydrogen standards and plan to boost bilateral investment in hydrogen energy and cooperate with the private sector in this area.
In November 2022, Russian Foreign Minister Sergei Lavrov visited Abu Dhabi. Lavrov held talks with two UAE ministers: his counterpart, Minister of Foreign Affairs Abdullah bin Zayed al-Nahyan and Minister of Industry and Advanced Technology Sultan bin Ahmed al-Jaber.
Sergei Lavrov's discussions with Abdullah bin Zayed al-Nahyan and Sultan bin Ahmed Al Jaber. Al Jaber is the first on the right. (Credit: UAE Ministry of Foreign Affairs and International Cooperation)
In June 2023, in his most recent capacity as President of COP28 (the 2023 United Nations Climate Change Conference), Sultan Al Jaber accompanied President Mohamed bin Zayed Al Nahyan during his meeting with Vladimir Putin in Sankt Petersburg. (https://www.opensourceinvestigations.com/)
Vladimir Putin and Sergei Lavrov have been under US sanctions since February 25, 2022. According to the US Government, "President Putin and Minister Lavrov are directly responsible for Russia's unprovoked and unlawful further invasion of Ukraine, a democratic sovereign state."
The Kremlin highly prizes UAE Ambassador to Russia Mohammad Ahmed Al Jaber.
On February 27, 2023, by decree of President Vladimir Putin, Mohammad Al Jaber was awarded Russia's Order of Friendship, the highest honor awarded to non-Russian citizens. The order was awarded to the UAE diplomat "for his big contribution to strengthening Russian-UAE relations."
The awarding ceremony took place on April 8, 2023, when Sergei Lavrov, Russian Foreign Minister Sergei Lavrov, decorated Ambassador Al Jaber in recognition of his significant contributions to strengthening UAE-Russian relations.
Sergei Lavrov awarding Mohammad Al Jaber the Order of Friendship (Credit: UAE Ministry of Foreign Affairs and International Cooperation)
It was the second Russian medal received by Mohammad Al Jaber in two consecutive years. In April 2022, the UAE ambassador was awarded the Medal Of Merit by the Minister of Foreign Affairs of the Russian Federation.
Mohammad Ahmed Al Jaber has been the UAE's ambassador to Moscow since September 2020. He and Sultan Al Jaber are brothers.