UK Edition
Grant Shapps takes aim at Russian aviation and shipping
Vladimir Putin's decision to shut out foreign airlines costs Kremlin billions in lost fees
Grant Shapps is vowing to “cripple Russia’s aviation and shipping sectors” as the Kremlin faces a $1.7bn (£1.3bn) hit to the economy from closing its airspace to foreign airlines.
After last week impounding a private jet that was suspected to be owned by Eugene Shvidler, a friend of Roman Abramovich, the Transport Secretary is pledging to “go after the oligarchs that support Putin” by seizing private jets and yachts.
Mr Shapps said: “If they dock their super yachts in the UK, we’ll seize them. If they land their private jets here, we’ll impound them.”
The comments come as Vladimir Putin’s decision to close Russian airspace backfires on the economy.
Russia makes more than any other country from charging airlines to use its airspace. In 2019, it generated $1.7bn from so-called overflight charges, according to UN sponsored body ICAO.
As many airlines now expect to run a similar number of flights this year as 2019 following pandemic disruption, a similar sum would have been generated had the Russian president not invaded Ukraine.
Graham Lake, an aviation consultant who advises air traffic controllers, said: “Use of Russian airspace was routine for many flights seeking the shortest routes between parts of Asia and both Europe and North America.
“The loss of that access means that aircraft operators are now using longer alternative routes, usually further south, using more fuel and increasing overall costs.”
Sean Doyle, the British Airways chief, said that the closure of Russian airspace would have a minimal impact on profits.
While airlines will burn more fuel avoiding Russia, they will save on its overflight charges, some of the most expensive globally. Most BA flights will be unaffected.
The UK’s impounding of a private jet at Farnborough airport on Wednesday marked the latest escalation between transport ministries in London and Moscow.
Mr Shvidler founded oil trading company Runicom alongside Mr Abramovich in 1995 before taking control of oil giant Sibneft.
The seizure of the aircraft, suspected to be owned by Mr Shvidler came just 24 hours before Mr Abramovich’s UK assets, including football club Chelsea, were frozen by the Government.
London-based oligarchs scrambled to leave London following Mr Putin’s invasion of Ukraine in the early hours of Feb 24. It is understood that London City airport thwarted attempts by a handful of Russians to jet off.
Meanwhile, Mr Putin’s oligarchs also sought to escape Europe by sailing their yachts to countries where sanctions are not being applied.
Russia, meanwhile, last week released draft legislation allowing the Kremlin to seize control of hundreds of foreign-owned commercial jets. The move risks triggering billions of pounds in insurance claims for policies that were written by Lloyd’s of London firms.
Mr Shapps said: "We cannot stand idly by while Vladimir Putin tramples over a sovereign, democratic country, laying waste to homes and hospitals. That is why the Government has deployed an unprecedented range of sanctions against Russia.
"I am doing all in my power to cripple Russia's aviation and shipping sectors. The state airline, Aeroflot, has been banned from UK airspace, together with all other Russian-owned, chartered or operated aircraft. At the same time, Russian freighters and tankers have been denied access to our ports.
"And I'm going after the oligarchs who support Putin. If they dock their superyachts in the UK, we'll seize them; if they land their private jets here, we'll impound them.”