Germany is considering nationalizing Rosneft's German assets

Following US sanctions on Russian oil companies, a discussion has been revived in Germany about the possible nationalization of Rosneft's German assets, which are currently under trusteeship, Reuters reported on Thursday, citing two sources familiar with the talks.

According to Reuters, “the situation underscores the complex web of ties between Germany and Russia, which for decades before the war in Ukraine powered Europe's industrial powerhouse.”

On Wednesday, the US agreed to exempt Rosneft, a German-owned company, from US sanctions on the Russian oil sector until the end of April 2026. However, as the agency emphasized, obtaining a permanent exemption remains Berlin's preferred option. German officials are also considering the possibility of taking over the business and selling it to a foreign investor.

A spokesman for the German Ministry of Economy said that the government was in “very intensive” contact with the US authorities. He added that the granted license was a “first step”, and talks are ongoing on the further extension of such a permit after April next year.

Reuters recalled that the trust agreement is renewed every six months but could be invalidated in court as each renewal examines the legal basis of what was intended to be a temporary emergency measure. So far, Berlin has avoided taking over Rosneft's local assets for fear of having to pay compensation to Moscow, it was emphasized.

The idea of ​​nationalizing Rosneft in Germany appeared during the government of the Social Democrats, Greens and Liberals, headed by Olaf Scholz.when the head of the Ministry of Economy was the Green politician Robert Habeck. According to MP Michael Kellner from the Greens, who worked in the last coalition government supervising Rosneft, the nationalization of the company is of “systemic importance for Germany.” “The government must nationalize Rosneft's operations in Germany to be sure about its future,” Kellner told Reuters.

Russian media estimated the value of Rosneft's German assets at approximately $7 billion. However, the real value may be less than half that, one of the two sources told Reuters.

The German government placed Rosneft's assets there under trusteeship in 2022. The reason for the decision was Russia's full-scale invasion of Ukraine. These assets include the Schwedt refinery, one of the largest in Germany; supplies much of north-eastern Germany and Berlin with gasoline, heating oil and kerosene.

The German authorities argued that Rosneft's assets in Germany had been disconnected from the main company, and at the same time they were crucial for the country's fuel security.

The US government has introduced sanctions against Russia's largest oil companies, Lukoil and Rosneft, and their 34 subsidiaries. The restrictions are intended to force the Kremlin to accept US President Donald Trump's proposal to freeze combat operations on the current front line of Russia's war against Ukraine. These are the first sanctions against Russian companies during Trump's second presidential term. (PAP)

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