Russian President Vladimir Putin this month made an emotional tribute to Christophe de Margerie, the former boss of France’s Total who was killed in an accident in 2014.
At the launch of a new gas tanker named after Mr de Margerie, Mr Putin declared him a “great friend of our country”, a sentiment that extends to many executives at Total’s European oil and gas peers.
While US energy groups stepped back from Russia in response to a sanctions regime that Washington lawmakers moved to tighten this month, rivals in the EU have held fast, ducking through loopholes in Brussels’ restrictions to keep joint ventures running.
Elizabeth Rosenberg, a sanctions expert formerly at the US Treasury and now with the Center for a New American Security, points to the “regulatory arbitrage” between the EU and US sanctions. “US firms see an uneven playing field,” says Ms Rosenberg.
Since the collapse of the Soviet Union, Russia has been a glittering prize for foreign oil companies. With proved reserves of 110bn barrels of oil and 32tn cubic metres of gas, according to BP, it is one of the world’s largest holders of economically producible hydrocarbons.
Sanctions slapped on Moscow in 2014 by the US, EU and other countries in response to Russia’s invasion of Crimea were aimed at cutting off the development of its new oil frontiers from western help.
In practice, however, not all sanctions have proven equal. ExxonMobil of the US reacted sharply by freezing capital and suspending projects, a position expected to become entrenched if new legislation that tightens restrictions further is written into law.
But the sanctions imposed by the EU have had a less decisive impact, in part owing to less stringent and less aggressive regulators in Brussels compared to Washington, according to trade experts.
Rainer Seele, chief executive of OMV, the Austrian oil and gas company, told the FT that sanctions had had little impact on its business in Russia. “We have made…