Shipping giants steer clear of Russia as Western net tightens

LONDON: The world’s biggest shipping lines MSC and Maersk on Tuesday suspended container shipping to and from Russia, deepening the country’s isolation as its invasion of Ukraine sparks an exodus of Western companies.

The West has imposed heavy restrictions on Russia to close off its economy and block it from the global financial system, pushing companies to halt sales, cut ties and dump tens of billions of dollars worth of investments.

The curbs have made Russia a no-go area for many of the world’s foreign-owned container ships, closed airspace to Russian aircraft, shut out some Russian banks from the SWIFT global financial network, and restricted Moscow’s ability to use its $630 billion in foreign reserves.

“We already had (Russia and Belarus) on a low rating,” Stephen Bird, chief executive of $727 billion asset manager abrdn, told Reuters on Tuesday. “After the conflict we deemed them non-investable.”

Energy firms BP and Shell have abandoned multibillion-dollar positions, while leading banks, airlines, automakers and more have cut shipments, ended partnerships and called Russia’s actions unacceptable.

Oil and gas group TotalEnergies, while stopping short of Shell and BP’s measures, said on Tuesday it would no longer provide capital for new projects in Russia, while Finnish telecoms equipment firm Nokia joined rival Ericsson in saying it will stop deliveries to Russia to comply with sanctions.

U.S. payment card firms Visa Inc and Mastercard Inc have blocked multiple Russian financial institutions from their network.

Major auto and truck makers, including Volvo Cars , AB Volvo, General Motors and and Harley-Davidson, have also cut off exports to Russia. Ford Motor, which has a 50% stake in three Russian plants, has not commented substantively on its plans.