Qatar and commodities trader Glencore have paid 10.5 billion euros for a stake in Russia’s giant oil firm Rosneft.
It comes days after Russia and OPEC agreed to coordinated output cuts to support oil prices, the first time they have cut in tandem in 15 years.
The state-owned firm had kept the deal a tightly-guarded secret. The first word emerged when Russian President Vladimir Putin met Rosneft Chief Executive Igor Sechin on Wednesday evening in Moscow.
Putin described the sale as the most significant this year in the energy market and the most significant in Russia’s privatisation history.
The deal, to acquire 19.5 percent of the firm from the Russian state, suggests the lure of taking a share in one of the world’s biggest oil companies outweighs the risks that come with Western sanctions imposed on Russia over the Ukraine conflict.
The president of Russia’s oil and gas service, Victor Khaikov, said there was no infringement of the sanctions because Qatar is a sovereign fund and Glencore is a firm representing Switzerland and therefore not the EU.
Italian bank Intesa Sanpaolo is expected to provide a large chunk of funds to the Qatar/Swiss consortium.
Glencore is likely to finance part of the deal by putting up 300 million euros of its own equity, with the rest financed by Qatar.