Special forces raided BP's offices in Moscow on Wednesday looking for documents containing words like "Arctic" and "oil." The unexpected visit is linked to an ongoing lawsuit with shareholders in Siberia over money lost in BP's failed deal with Russia's state-owned oil company Rosneft to drill in the Arctic. One shareholder's lawyer told The Guardian that the raid came in response to BP's failure to deliver documents related to their $2.75 million compensation claim to court. However, the black-clad commandos carried assault rifles and roughed up the staff a little bit. BP condemned the raid, saying that Russian authorities had no legitimate grounds for such an aggressive move. "Did they expect to meet any resistance here?" wondered BP's Russian spokesman.
The incident left everybody wondering if the police presence might have more to do with Russia's new deal to allow Exxon to drill in Arctic instead of BP and Vladimir Putin's mounting campaign to reclaim the nation's top office. (That's Putin smiling next to Exxon president Rex Tillerson above.) Did the Russians really grab headlines in order to find some missing documents for a lawsuit in an obscure Siberian court? Or are they trying to send a message to the American oil industry? Here's a look at the analysis out in today's papers.
Andrew Kramer at The New York Times doesn't try to guess about Russia's intentions for the BP raid. Exxon got the message either way:
Whether the Russians intended to send a signal or not, the episode seemed to serve notice to Exxon that, when it comes to dealing with the state-run business world of Prime Minister Vladimir V. Putin, Exxon isn't in Texas anymore.
"That incident, I'm sure, made Exxon very uncomfortable the day after they signed their deal," Matthew Lasov, director of research at Frontier Strategy Group, a consultancy for companies operating in the developing world, said of the raid.
Leia Parker at The Wall Street Journal similarly said that Russia's made an example of BP that Exxon will surely pay attention to:
Nearly everybody’s favorite punching bag of late [is] U.K. oil giant BP PLC. But even as its U.S. rival ExxonMobil Corp. toasts its victory in landing a new Arctic deal with Russia’s OAO Rosneft, Exxon had better watch its back, or it might just share the same fate.
George Trafgarne, a former BP employee, wrote in The Telegraph that the new Exxon deal raises the stakes and implicates American politics:
Nor is Exxon invulnerable: a clause in its deal says that Rosneft will also buy stakes in its projects in America, which will give Exxon some insurance over any disruption of its investments in Russia. However, neither Congress nor the US authorities have yet approved the idea of the Russian state snapping up parts of the heartland, and may not take kindly to it. Earlier this year, Congressman Edward Markey, a Democrat, ridiculed BP as “Bolshoi Petroleum”. How will he and his friends respond now Exxon is in bed with the Russians?
The truth is that in this game of power and money, it has always suited Moscow to play the international oil companies off against each other. Exxon may be in the ascendant now, but next year it could be Shell, or even BP again. Bob Dudley, the chief executive of the British oil giant, looks beleaguered today. But in my dealings with him, he always reminded me of the tortoise in Aesop’s fable about the race with the hare. He might get off to a slow start, but he usually wins in the end.
Stefan Wagstyl at The Financial Times notes that the stakes are raised on Exxon's new accord with Rosneft, and Putin is watching:
As with BP, the accord has been signed in the presence of Russian prime minister Vladimir Putin. Rosneft will want make sure that this time, the relationship doesn’t go wrong.