Russia has barred investors from so-called hostile nations from selling shares in important energy projects and banks until the end of the year, increasing pressure on the West in the sanctions standoff.

Since Russia’s incursion into Ukraine in late February, Western countries and allies, including Japan, have piled on financial sanctions. Moscow replied by making it difficult for Western corporations and their friends to leave Russia, and in some cases seizing their assets.

The decree, signed by President Vladimir Putin and published on Friday, prohibits investors from sanctioned countries from selling assets in production sharing agreements (PSA), banks, strategic entities, companies producing energy equipment, and other projects ranging from oil and gas production to coal and nickel.

The decree stated that Putin might give a special dispensation in certain situations to allow the deals to proceed, and that the government and central bank should compile a list of banks for approval by the Kremlin. The directive made no specific reference of any investment.

The embargo applies to practically all major financial and energy projects in which foreign investors remain involved, including the Sakhalin-1 oil and gas project.

On Thursday, Rosneft, Russia’s national oil company, blamed ExxonMobil for dropping output at the Sakhalin-1 group of fields, after the American energy company claimed it was in the process of transferring its 30% stake “to another party.”

Separately, a government decree issued on August 2 gave foreign investors in the Sakhalin-2 liquefied natural gas (LNG) project – Royal Dutch Shell, as well as Japanese trading houses Mitsui & Co and Mitsubishi Corp – a month to claim their stakes in a new entity that will replace the existing project.

According to the new decree, the Sakhalin-2 project is not covered.

Shell was seeking for ways to exit the project, while Japan’s government underlined its desire for Japanese companies to keep their holdings.

UniCredit and Intesa of Italy, Citigroup of the United States, and Raiffeisen of Austria are still looking for ways to escape Russia, while Societe Generale and HSBC have found a route out.

(Adapted from FinancialPost.com)

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