Russia supplies oil to North Korea in defiance of UN sanctions

Unlock the Editor’s Digest for free

Good morning. Russia has started supplying oil directly to North Korea in defiance of UN sanctions, further cementing ties between the two authoritarian regimes and dealing a new blow to international efforts to contain Pyongyang.

At least five North Korean tankers travelled this month to collect oil products from Vostochny Port in Russia’s Far East, according to satellite images shared with the FT by the Royal United Services Institute, a UK think-tank.

The shipments are the first documented direct seaborne deliveries from Russia since the UN Security Council — with Moscow’s approval — imposed a strict cap on oil transfers in 2017 in response to Pyongyang’s nuclear weapons tests.

The sanctions regime “is now on the brink of collapse”, said Hugh Griffiths, a former co-ordinator of the UN panel that monitors sanctions on North Korea.

The oil deliveries come after North Korea last August began supplying thousands of containers of munitions to Russia for its war effort in Ukraine. Here’s more on the apparent “arms-for-oil” trade between Pyongyang and Moscow.

• War in Ukraine: Volodymyr Zelenskyy has reshuffled his top intelligence and national security chiefs, the second personnel shake-up this year aimed at reinvigorating Ukraine’s war effort.

And here’s what else I’m keeping tabs on today:

• Economic data: Australia publishes consumer price index inflation rate data for February, Malaysia releases its monthly producer price index and the EU reports March consumer confidence figures.

• China: Xi Jinping plans to hold a rare meeting with American business leaders on the heels of the China Development Forum. China’s leader is also expected to meet Dutch Prime Minister Mark Rutte (Wall Street Journal, Reuters)

• Boao Forum for Asia: The annual conference modelled on the World Economic Forum in Davos enters its second day on the southern Chinese island of Hainan.

• Industrial & Commercial Bank of China: The country’s biggest lender publishes 2023 full-year results.

Five more top stories

1. A Chinese state-owned shipping company building one of Latin America’s biggest deepwater ports has criticised a move by the Peruvian government to remove its exclusive right to operate the facility. China Cosco’s Peruvian arm said the exclusivity granted over the Chancay megaport had been a “relevant factor” in the company’s decision to spend $1.3bn on the construction of its first phase. Here’s more on Peru’s U-turn.

2. Japan has eased rules on weapons exports to allow sales of a new fighter jet. The loosening of restrictions clears a hurdle for Tokyo’s plans to develop with the UK and Italy a highly advanced combat aircraft by 2035. The government will allow the transfer of the new fighter jet to 15 countries that have signed defence equipment transfer agreements with Japan.

3. BYD profit rose last year but fell short of expectations as Tesla’s main Chinese rival felt the brunt of intensifying competition and slowing sales growth. The world’s biggest electric vehicle producer lost some ground following Huawei’s entrance to the car market, coupled with strong sales in China of plug-in hybrid vehicles. 

4. Rishi Sunak is preparing a new crackdown on Chinese entities operating in Britain following repeated cyber attacks by Beijing, but the prime minister’s allies said any action would be proportionate. Sunak is facing pressure from China hawks within his party to take tough action in the wake of the cyber attacks.

5. Shares in Donald Trump’s social media business jumped on their New York market debut yesterday, making the former US president’s stake worth $4.6bn. Trump Media & Technology Group, the company behind his Truth Social platform, closed up 16 per cent at $57.99 a share, boosting the presumptive Republican presidential nominee’s fortune as he faces a pile-up of legal and financial woes.

• More US news: The US faces a Liz Truss-style market shock if the government ignores the country’s ballooning federal debt, the head of Congress’s independent fiscal watchdog has warned.

News in-depth

Analysts say that last week’s deadly attack on a Moscow concert hall, which Afghan-based extremist group Isis-K claimed responsibility for, is the latest sign that regional jihadi groups have become more powerful since the Taliban retook power in Afghanistan following the US’s chaotic 2021 withdrawal. Governments are increasingly concerned that the country that once sheltered the masterminds of the September 11, 2001 attacks is again becoming a hotspot for global jihadis.

We’re also reading . . . 

• India’s endless election: Voting will take six weeks, a process opposition parties say puts them at a disadvantage. But such criticisms are unlikely to sway India’s massive electoral machine, writes John Reed.

• The Maga machine: If Donald Trump wins this year’s election, he will be backed by a group of experienced former officials eager to apply his ideas. Here’s a look into the former president’s new inner circle.

• China’s solar billionaire feels the heat: Longi founder Li Zhenguo is laying off thousands of staff as the industry grapples with a collapse in prices.

Chart of the day

The price of cocoa surged through $10,000 per tonne for the first time yesterday, as a dizzying rise in prices caused by poor harvests in Africa accelerates.

Take a break from the news

Marc Jacobs is a true fashion maverick, constantly changing tack in unexpected ways. But his motivation remains the same: to be an entertainer. Alexander Fury interviews the designer, who is celebrating his brand’s 40th anniversary this year.

Additional contributions from Tee Zhuo and Gordon Smith