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Ukraine Latest: Russian Disputes US Account of Drone Downing

(Bloomberg) -- A Russian fighter jet collided with a US surveillance drone in international airspace above the Black Sea, causing the American aircraft to crash, the Pentagon said.

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Russia’s defense ministry denied the US claim, saying its jets didn’t come into contact with the drone, according to a statement posted on Telegram. The statement said the drone’s transponders were off, and it flew out of control and crashed “as a result of sharp maneuvering” and that the Russian aircraft returned safety to their base.

The US European command said the Su-27 warplane, accompanied by a second Russian jet, struck the propeller of the MQ-9 Reaper drone in what was an “unsafe and unprofessional” intercept at around 7 a.m. local time. The two Russian fighter jets flew in front of and dumped fuel on the drone before the strike, it said.

Key Developments

  • India’s Opaque Purchases of Russian Oil Emerge as Sanctions Test

  • Russian Fighter Jet Collides With US Drone Over Black Sea

  • Putin Says Unexploded Bomb May Still be Attached to Nord Stream

  • Russian Oil Price Cap Seen Working Even With 25% Participation

  • Ships That Loaded Russian Oil Float for Months Near Persian Gulf

(All times CET)

Ukraine’s Government Dismisses Three Regional Governors (9:11 p.m.)

Ukraine’s Cabinet of Ministers has approved dismissal of the heads of governments in three Ukraine’s regions including Odesa’s Maksym Marchenko, Khmelnytskyi’s Serhiy Hamaliy and Luhansk’s Serhiy Haiday, news service Interfax reports citing the Cabinet’s representative in the parliament, Taras Melnychuk. Melnychuk didn’t elaborate on the reasons for dismissal.

Ukraine’s authorities dismissed governors of Dnipropetrovsk, Zaporizhzhia, Kyiv, Sumy and Kherson region in January.

Putin Says Unexploded Bomb May Still be Attached to Nord Stream (6:19 p.m.)

An unexploded bomb may still be attached to one of the Nord Stream gas pipelines, having failed to detonate during last year’s attack, Russia’s President Vladimir Putin said.

“Apparently, several explosive devices were set” Putin said in an interview with a state-run TV channel on Tuesday.“Some of them exploded and some didn’t — it’s unclear.”

When inspecting the pipelines after the attacks, a vessel chartered by Gazprom PJSC found a small pile about 30-kilometers (19 miles) from another blast that could be an antenna for receiving a signal to activate an explosive device, Putin said, citing specialists.

Poland May Transfer MiG29 Jets in Coming Weeks (5:39 p.m.)

Poland may send its Soviet-era MiG-29 jets to Ukraine in four to six weeks, Prime Minister Mateusz Morawiecki said at a news conference in Warsaw on Tuesday, without elaborating.

Russia’s Finance Ministry denied an Interfax report that it plans to issue “patriotic” bonds to help sustain the country’s financial markets amid sanctions imposed over its invasion of Ukraine.

Rheinmetall AG, Germany’s largest munitions manufacturer, said Europe’s defense industry can’t meet Ukraine’s artillery ammunition needs unless nations boost spending to double production capacity.

Russia Denies ‘Patriotic’ Bond Plans (5:30 p.m.)

The Russian Finance Ministry said it isn’t preparing “patriotic” bonds, denying earlier report by Interfax.

“The Ministry of Finance has not offered and is not currently preparing an issue of ‘patriotic’ bonds,” it said in an emailed statement. “This was discussed earlier as an idea, no details were developed.”

Interfax reported earlier that the preliminary idea was one of several points in a plan the ministry proposed to the government to help ensure Russia’s “financial sovereignty.” Foreign investors have all but disappeared from the Russian bond market since the US and its allies imposed sweeping sanctions on the country over the invasion last year.

Rosneft Loses Court Fight Over German Seizure of Local Units (5 p.m.)

Rosneft PJSC, Russia’s state oil company, lost its legal fight against Germany’s takeover of its units in the country in the aftermath of the invasion of Ukraine.

Germany’s top administrative court in the city Leipzig ruled on Tuesday that putting the units under a government trusteeship was in line with the law and follows the state’s assessment that without the move, there was a danger to energy security.

Spain Boosts Russia LNG Imports 84% (3:45 p.m.)

Spain’s imports of Russian liquefied natural gas have soared 84% since the outbreak of the war in Ukraine, highlighting how dependent Europe remains on Moscow despite efforts to slash energy ties.

Putin Warns of Medium-Term Risks to Economy (3:15 p.m.)

Russia’s economy faces risks in the medium term as the impact of sanctions imposed by the US and its allies over the Kremlin’s invasion of Ukraine starve industry of modern technology, President Vladimir Putin said in an unusual admission of the risks to the outlook.

“That danger does exist,” he told workers during a visit to a helicopter factory in Siberia. “Enterprises with long production cycles of course need modern equipment and technology, but I think everything will be fine.”

Russia’s economy contracted less last year than many forecasters initially expected but economists warn that sanctions are likely to sap growth in the future.

Poland May Transfer Fighter Jets to Ukraine (1:30 p.m.)

Morawiecki said Poland may send its MiG29s to Kyiv soon, but it remains unclear whether Warsaw has made a final decision. If Poland decides to support Ukraine’s air forces with Soviet-era fighter jets, it would be the first NATO country to offer such aircraft.

When Warsaw offered in the first weeks of the war to dispatch MiGs by way of a US airbase, the Pentagon said the arrangement was “not tenable.”

Poland May Send Jets to Kyiv in Coming Weeks, Premier Says

Ukraine and One NATO Member State Extend Shell Production (1:15 p.m.)

The state-run Ukroboronprom said it started making 125mm shells for tanks and has already delivered the first shipment to the frontline, the company said on Telegram.

It’s the second type of shells that is being made in cooperation with a NATO member country, which was not identified for security reasons. The production is located outside Ukraine but Ukrainian designers and experts are involved in the process.

Most Russian Oil Sold Outside G-7 Priuce Cap, US Says (1 p.m.)

The bulk of Russian seaborne oil is still being sold outside the price cap imposed by the Group of Seven nations late last year, according to remarks to be given by a US Treasury official Tuesday in Washington.

“About 75% of the trade of Russian seaborne oil occurs outside of the price cap,” Assistant Treasury Secretary Ben Harris is expected to say, according to a copy of his remarks seen by Bloomberg and citing a report he didn’t identify. “That means no Western services are involved in the transaction and, therefore, these trades do not violate or evade sanctions.”

Russia’s Shoigu Orders Production of High-Precision Missiles Doubled (12:47 p.m.)

Russian Defense Minister Sergei Shoigu told a major state-run producer of high-accuracy missiles to double output of the weapons, which have been in short supply as the war enters its second year.

“You can do it,” Shoigu told managers in televised comments during a visit to the Tactical Missile Corp. “The only task is to increase labor productivity.”

Russia has suffered chronic shortages of many of its most advanced weapons, in particular high-accuracy missiles, amid heavy use of them in the war in Ukraine, according to US and European intelligence estimates.

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