Top stories in the Russian press on Friday, August 30, prepared by TASS

Izvestia: Russian-Ukrainian prisoner swap to be held soon despite difficulties

The defense counsel representing RIA Novosti Ukraine director Kirill Vyshinsky is not aware of plans to exchange him for Oleg Sentsov.. His attorney Andrey Domansky told Izvestia that Vyshinsky seeks to prove his innocence in court and does not intend to change his mind. The decision to change the preventive measure for the journalist was connected to the termination of political pressure on the court by the authorities, his lawyer said. Meanwhile, Valentin Rybin, the defense counsel of other Russians detained in Ukraine, believes that the exchange of prisoners is hindered by the absence of a decree by Ukrainian President Vladimir Zelensky to pardon the detainees.

Domansky told Izvestia that he did not know anything about plans to connect Vyshinsky to the exchange, and assured that his client’s position had not changed. "We will move to an acquittal by representing interests and protecting Kirill’s rights. Our position is strong," he told Izvestia.

Nevertheless, the media reported that filmmaker Oleg Sentsov, sentenced to 20 years behind bars on charges of plotting a terrorist attack in Crimea, was brought to Moscow. A source told Izvestia that Kiev seeks an arrangement that would make it look like Vyshinsky is being exchanged for Sentsov, the newspaper wrote.

Attorney Valentin Rybin told Izvestia that despite some difficulties, the swap should nonetheless take place in the near future. According to him, the main hitch is the absence of a decree on pardon by President Vladimir Zelensky.

At the same time, a source close to the negotiations between Moscow and Kiev told Izvestia that until the court makes a decision on the 24 detained Ukrainian sailors, their inclusion in the swap is impossible. At the same time, the lawyer of the Ukrainians, Nikolai Polozov, earlier refused to comment on this topic, so as "not to harm the ongoing processes."

Nezavisimaya Gazeta: Naftogaz-Gazprom feud might complicate gas transit talks

With 2020 only a few months away, there is less and less clarity on further gas cooperation between Russia and Ukraine. Naftogaz’s pursuit to recover around $3 bln from Gazprom in 2020 only worsens the situation. According to experts interviewed by Nezavisimaya Gazeta, the concern is not going to pay the billions sought by the Stockholm arbitration to Ukraine. Meanwhile, the date of trilateral transit negotiations has not yet been determined, although at the highest level, Russia and Germany agreed that negotiations should be accelerated.

Ukraine has far-reaching plans to recover funds from Gazprom, the newspaper wrote. Thus, Yury Vitrenko, a high-ranking Naftogaz Group executive, said that assets were frozen in the UK and the Netherlands, and restrictive measures are in effect in Luxembourg and Switzerland. This year, Gazprom deposited $345 mln in security payments to the High Court of Justice in England and Wales as part of a dispute with Naftogaz. Experts interviewed by Nezavisimaya Gazeta explained that Gazprom’s security payment deposit into a UK account does not mean that the group recognized their debt to Ukraine.

"The court is awaiting the results of Gazprom’s appeal against the Stockholm arbitration ruling. The deposit of $345 mln in security payments into the court’s account does not mean the automatic transfer of these funds to Naftogaz," Associate Professor of the Higher School of Corporate Management of the RANEPA Tamara Safonova told the newspaper.

The dispute might impact the future of trilateral gas negotiations between Moscow, Kiev and the European Union concerning Russia’s gas transit through Ukraine. "The current language of negotiations in Ukraine is judicial," Safonova said. "Delaying the negotiation process may be related to the hope placed on the court decision in favor of Naftogaz and the search for a window of opportunity to agree on the best conditions for the supply of Russian fuel," she added. "The sides, both Russian and Ukrainian, are now in a difficult bargaining situation regarding the terms of new contracts," Director of the Law and Mediation Fund for the Fuel and Energy Complex Alexander Pakhomov said. "The presence or absence of progress in litigation is used by them as arguments when agreeing on conditions," the expert told Nezavisimaya Gazeta.

Izvestia: Rosneft quadruples sales of jet fuel to foreign airports

In the first half of 2019, Rosneft almost quadrupled the volume of deliveries of jet fuel to foreign airports to 200,000 tonnes, the company told Izvestia. Such results were achieved through access to German airports, where 142,500 tonnes were sold, according to Director of the Special Oil Products Department Timofei Khokhlov.

Experts interviewed by the newspaper confirm that Germany is one of the main directions in the oil company’s foreign expansion. This year, Rosneft Deutschland's subsidiary has signed contracts to provide jet fuel for the air hubs of Berlin and Munich and the producer now plans to enter other cities of Germany. Leading expert at the Union of Oil and Gas Industrialists Rustam Tankayev told Izvestia that the company indeed focuses heavily on the German market. "The company has shares in three oil refineries in Germany and supplies approximately 12% of all motor fuel sold in this country. I think this figure will grow. The start of deliveries of jet fuel to German airports is a logical next step towards increasing its share in this profitable market," he said.

In addition to Germany, Rosneft refuels aircraft at the airports of the three largest cities of Georgia (Tbilisi, Kutaisi, and Batumi) and the capital of Mongolia, Ulan Bator. In Russia, the company also aims to further expand to regional airports. Rosneft Aero, a Rosneft subsidiary that sells jet fuel, told Izvestia that growth of fuel sales was most noticeable at Moscow’s Sheremetyevo Airport, as well as at Pulkovo in St. Petersburg, and at Pashkovsky Airport in Krasnodar. According to senior analyst at BCS Premier Sergey Suverov, the demand for jet fuel will only grow.

Kommersant: Spotify postpones launch in Russia

Spotify, a Stockholm-based audio streaming service has postponed its launch in Russia until the end of the year, although it began to actively search for employees and an office in the country. According to Kommersant sources, the delay may be due to Spotify's global struggle with Warner Music. The Russian market for streaming services has not yet been shaped, so it has great potential, but Spotify is unlikely to occupy a significant share of it, analysts told the newspaper.

The Swedish service wanted to enter Russia back in 2014, but for various reasons, the launch was held up. Another delay may be due to a conflict between Spotify and one of the largest music publishers, Warner Music. One of Kommersant’s sources believes the companies had serious disagreements about licensing conditions when Spotify entered the Indian market in late February. "Entering Russia without Warner is pointless," the source said.

Currently, in Russia there are several major streaming services: Apple Music, Yandex.Music, Google Play Music (the subscription price is 169 rubles, or $2.53), and Boom from Mail.ru Group (the subscription price is 149 rubles, or $2.24). According to J'son & Partners Consulting, in 2018 the volume of Russia’s music streaming market amounted to 5.7 bln rubles ($85.5 mln), and in 2021 it is anticipated to reach 18.6 bln rubles ($279 mln).

Karen Ghazaryan, chief analyst at the Russian Association for Electronic Communications, told the newspaper that he generally believed that the music streaming market is far from saturated, and that there is a place for Spotify at a competitive price.

Meanwhile, Director of Ionoff Music label Alexander Ionov said that Russia would be a difficult market for Spotify. "Convincing young listeners interested in themed playlists to switch from Apple or Boom will not be easy," he told the newspaper pointing out that this company will need aggressive marketing. "Apple is doing everything it can to prevent Spotify from entering its territory," Ionov noted.

Kommersant: Large holdings eye taking regional airports under management

CEO of Airports of Regions holding Evgeny Chudnovsky proposed creating a single company, together with Novaport, which will manage small regional airports with passenger traffic from 50,000 to 500,000 people a year, Kommersant wrote citing industry sources.

According to the newspaper’s sources, it was proposed to create a company and transfer 10 airports to it on a pilot stage under concession conditions to attract investment and develop infrastructure. In the future, the number of airports can be increased to 50. Funds for the project are expected to be earmarked from the federal budget and soft loans from state banks.

The Russian Ministry of Transport confirmed the holding’s offer to the newspaper, noting that "this proposal is of interest," but requires detailed study.

The Airports of Regions holding also sent another letter to the government asking to loosen up transport safety requirements at small airports in order to reduce operating costs, Kommersant reported. An industry source emphasized that the measure would not lead to less security.