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Italy has proved it is a ‘reliable partner at the darkest of times’, say analysts

Italian defence and engineering companies have emerged among the winners from strengthening ties between the Gulf countries and Giorgia Meloni’s government, signing deals for weapons systems and munitions amid heightening geopolitical uncertainty.

State-controlled Leonardo received a €320mn naval combat systems order from Kuwait and has also announced it will provide four of its C-27J maritime patrol aircraft to Saudi Arabia for €200mn. Riyadh will also purchase lightweight torpedoes from Italian shipbuilder Fincantieri in a €200mn deal announced earlier this year.

Meanwhile, Abu Dhabi’s defence contractor Edge is buying a controlling stake in Italy’s family-owned engineering company CMD, whose high-performance engines for luxury cars can be used to build low-cost surveillance and interceptor drones.

Italy had “proved it’s a reliable partner at the darkest of times” said Mohammed Baharoon, head of the Dubai Public Policy Research Centre, referring to the Italian prime minister’s visit to the region after the US and Israel launched their war against Iran.

Before the war, Meloni had already been promoting ties with Gulf countries. In December, she attended the annual Gulf Cooperation Council summit as the guest of honour, a rare invitation extended to only a handful of foreign leaders.

Iran retaliated to the US-Israel attacks by launching barrages of missiles and drones at the US Gulf allies, and her trip to the region in April, days before the ceasefire between the US and Iran, also impressed her counterparts and generated goodwill.

The recent defence deals come as Gulf governments turn to Europe and Asia looking to bolster air defences and develop their own defence industries. The governments have also signed deals with South Korea and Ukraine. Analysts said Gulf nations had also questioned the political reliability of the US under President Donald Trump.

They expect further deals on the horizon. The UAE last year said it would invest €40bn in Italy in a range of sectors, while Gulf countries are in talks over possible equipment purchases from Italy. Qatar and Fincantieri are discussing the development of new mobile counter-drone systems and an underwater system. Saudi Arabia has been in discussions with a clutch of small high-tech Italian firms over space co-operation.

“Gulf authorities were left feeling highly exposed after the US faced problems in providing countries with enough missiles and ammunition” for air defence systems, said Alessandro Marrone, the head of defence and security programme at Rome’s Institute of International Affairs.

“There was no plan B for a prolonged campaign. The Gulf countries took note of that . . . They learned if they diversify their partners, they will be better prepared in case of another conflict,” he said.

The UAE has borne the brunt of Iran’s retaliation against the US and Iran, with nearly 3,000 missiles and drones launched against it since the start of the war, forcing authorities to utilise expensive US and Israeli-made air-defence systems to protect against swarms of cheap Iranian drones.

Rodrigo Torres, chief financial officer of Edge, said his company’s talks with Italy’s CMD began in March as Gulf authorities rushed to find partners to help them rapidly expand production of low-cost surveillance and interceptor drones.

“With Europe, and especially Italy, we have a very tight relationship,” he said, noting that the UAE needed “quantity” and “sophistication”.

Edge’s deal for CMD involves the transfer of crucial technology to the Gulf, at a time when governments had been trying to diversify away from energy to boost their “knowledge-based economies”, said Baharoon.

Established in 2019 through the merger of two dozen legacy companies, Edge has signed agreements with other European groups. Days before the US attack on Iran, it signed a deal with Spain’s EM&E group to explore setting up a UAE-based joint venture to develop $1.5bn worth of remote weapons stations. It also agreed to create a shipbuilding joint venture with France’s CMN Naval to produce nearly €7bn worth of small and medium-sized naval vessels.  

Morten Wierod calls for urgent deregulation as energy shock from Iran war dents EU competitiveness

Europe must deregulate to boost competitiveness in the face of the Iran war energy shock or risk a “mass unemployment” crisis, the head of one of the bloc’s largest engineering groups has warned.

Morten Wierod, ABB chief executive, told the FT that European lawmakers have displayed “no sense of urgency” in pursuing deregulation even as rising gas prices in Europe dent the bloc’s competitiveness compared to the US.

He noted that the blueprint for reform commissioned by the European Commission and written by former Italian prime minister Mario Draghi was published almost two years ago but that little had been done about it.

Morten Wierod says the EU should remove legislation to drive more of a single market © ABB

“I hope that we don’t need to see a much bigger crisis that means mass unemployment. That should not be necessary to get that right sense of urgency,” said Wierod in an interview in New York.

“The single market or EU needs to remove more legislation and not just to simplify but to eliminate and to drive more of a single market, that will drive economic growth.”

ABB, which is based in Zurich, Switzerland, is one of Europe’s largest industrial engineering and technology companies with a market capitalisation of almost $200bn. It employs 52,400 people in Europe — almost double the number of staff that it employs in the US, which is the top revenue-generating region for the group.

Wierod said the plan announced by Brussels this week to introduce rules to reduce dependence on foreign technology could have “unintended consequences” and raise costs.

“We are in favour of open trade . . . we see that when you build this legislation around some of the ‘Made in Europe’ discussions going on now — there are always side effects.”

Wierod is the latest top business leader to urge Europe to slash red tape and implement reforms to boost the bloc’s competitiveness.

In October, the chief executives of TotalEnergies and Siemens wrote an open letter to French President Emmanuel Macron and German Chancellor Friedrich Merz, urging EU states to abolish a primary corporate sustainability law. EU lawmakers agreed reforms to scale back the law in March.

The Commission has launched a “simplification” drive to reduce red tape that it claims has already produced €15bn in annual savings for businesses and national authorities.

But progress on implementing the 2024 Draghi report, which highlighted a widening productivity gap between the US and Europe, has been slow. Just 10 per cent of his 383 proposals have been enacted, according to an online tracker.

Wierod said Europe had some great assets: its workforce, access to high-quality education and crisis-management experience.

“If you saw how Europe was able to deal with and change the dependency on Russian gas — that happened quickly, from 35 per cent to 10 per cent within a year. So, crisis management is there.”

But he said competitive pressures are rising in Europe due to the gas price inflation caused by disruption to supplies from the Middle East from the Iran war.

“I’m not worried that Europe will have gas. They will. But it will come at a higher price and that was what we saw in 2022 — and we know these [higher] gas prices will remain for 2026 and 2027,” Wierod said.

“So this, of course, will have an impact more again on European competitiveness than the United States, because you have your own gas.”

Up to 1.3mn jobs in the EU could be lost as a result of the higher prices, Roxana Mînzatu, European commissioner for jobs, said on Wednesday.

ABB is lobbying EU policymakers to accelerate electrification, industrial efficiency and decarbonisation, saying it is the fastest way to make the bloc more competitive.

OpenAI plots biggest ChatGPT overhaul since launch

$850bn start-up to recast hit chatbot as a route to higher-margin products before a potential IPO

OpenAI is preparing the biggest overhaul of ChatGPT since its launch kicked off the AI boom, as the $850bn group hunts for new engines of growth ahead of a planned listing this year.

The company intends to transform the chatbot into a “superapp” that combines coding tools and AI agents, adding products that executives believe will generate more revenue.

The changes are part of a broader reorganisation at OpenAI as the San Francisco-based company shifts resources into trying to win lucrative business customers and compete more fiercely with rival Anthropic, according to more than a dozen current and former employees.

OpenAI faces growing pressure to drive revenues higher and forge a path to profitability, as it prepares for an initial public offering.

The strategy marks a departure for a company, led by chief executive Sam Altman, that became the face of the AI boom and took the technology mainstream when it unveiled ChatGPT in 2022.

The changes, which will give greater prominence and resources to OpenAI’s coding product Codex, reflect a growing conviction within the company that the future of AI lies not in chatbots that answer questions but in agents that perform tasks for users.

“Chat is dead,” said one senior OpenAI employee.

OpenAI executives increasingly view ChatGPT, which has attracted nearly 1bn users since its launch, as a gateway to introduce users to higher-value products. The majority of consumers use the chatbot for free.

The company is embarking on the changes amid a belief that the advent of AI agents, which can perform multiple tasks for users from booking travel to organising calendars, will be a more valuable product than the chatbot.

At the same time, products such as Codex are able to write code and create software based on simple instructions from users.

The overhaul, which is set to begin rolling out in coming weeks, will initially appear as changes to ChatGPT’s website and mobile apps, encouraging customers towards using coding, image-generation and apps from external partners.

The changes underline how OpenAI’s strategy is moving closer to that of Anthropic, whose focus on developing products for businesses has stoked its blistering growth, and will be at the heart of its pitch to investors in an IPO this year. 

Outlining the changes, Thibault Sottiaux, who previously ran Codex and now leads all of OpenAI’s core product and platform, told the FT: “It will transcend the actual surface . . . what we’re building towards is where you have your own personal agent that is capable of helping you . . . across everything in your life, be it personally or at work.” 

He added: “You can connect through it on your mobile, desktop or web. When you’re in the car, you can talk to it.”

The majority of Codex users pay for the service, according to people familiar with the matter, while the 2mn businesses that use OpenAI’s products account for roughly 40 per cent of its revenue.

The company anticipates this will rise to 50 per cent by the end of the year.

OpenAI’s Codex product has increased its user base sixfold to more than 5mn weekly active users since the launch of a desktop application in February.

Its launch has intensified competition with Anthropic, whose Claude Code product has emerged as one of the start-up’s fastest-growing businesses.

“Approximately a year ago, OpenAI’s strategy was swing for the fences, whereas Anthropic’s strategy is make money first,” said Jenny Xiao, partner at Leonis Capital and former researcher at OpenAI.

“Now the two are converging, because both of them are trying to aim for an IPO and investors care more about money than dreams.”

To encourage users to adopt those services, OpenAI is redesigning ChatGPT’s interface, adding new prompts and features that direct users towards coding tools, image generation and applications built by partners such as Canva and Booking.com, according to people familiar with the plans.

Over time, OpenAI intends to ditch the prompts and features, betting that its models will be able to automatically understand users’ intentions when they are on the app or site.

This year, the company has brought ChatGPT, Codex and other product teams under a single leadership group led by Sottiaux, while several senior executives, including former product head Kevin Weil, have departed.

In a sign of OpenAI’s push to win more business customers, some consumer-focused initiatives have been sidelined, including a checkout feature that allowed purchases within ChatGPT. It also shut down Sora, its video-generation product, less than a year since its launch.

Executives believe users will increasingly interact with a single AI assistant rather than a collection of separate applications. As agents become more capable, OpenAI expects the distinction between chatbots, coding tools, search products and other software categories to blur.

“When we have [artificial general intelligence], I don’t think there will be a large number of distinct brands,” said Alex Embiricos, OpenAI’s head of enterprise product. “Probably there will be a single entity that I can talk to that can do whatever I need.”

Sean Doyle’s warning comes as jet fuel prices have doubled since Iran war began in February

The chief executive of British Airways has warned that fares will have to rise further if fuel prices stay high.

“There’s no getting away from if fuel goes up, fares have to go up,” Sean Doyle said in an interview on the sidelines of the International Air Transport Association’s annual meeting in Rio de Janeiro. 

Jet fuel prices have doubled since the war in Iran began in February. Despite ceasefire talks, the Strait of Hormuz remains closed. The passage accounts for about 40 per cent of Europe’s jet fuel.

Airlines across the world have already increased prices to try to recoup higher costs. BA’s rival Virgin Atlantic brought in surcharges of £50 to economy tickets, £180 to premium and £360 to higher classes.

BA warned last month it would raise prices, especially in business class, to offset higher fuel costs. But Doyle said prices would rise further if fuel costs remained stubbornly high.

The airline will raise fares more on long-haul services than short-haul, a more competitive market segment.

“When people’s purpose to travel is business and doing deals . . . those price increases are kind of peripheral to the reason they’re travelling,” said Doyle. 

“A brand like BA, which has got a lot of long-haul, a lot of corporate, a lot of premium, we’d expect maybe to have more pass-through of prices than maybe a carrier who’s solely competing for leisure short-haul.”

Despite recent climbs, airfares had failed to keep pace with inflation, he said, meaning many prices were the same today as in the 1990s. 

“We had fares in 1995 of Barcelona for £60 one way. You can go on BA.com and probably get Barcelona for not too much more than that off peak,” said Doyle. “If you think about air fares as a percentage of the overall amount people spend on a holiday, it’s still a small percentage.”

The airline has used planes that no longer fly to the Gulf to add capacity on other routes such as those to Bengaluru. It is planning to resume services to the Gulf in the coming months.

BA plans to restart flights to the region in the coming months but will not relaunch Dubai until October, which marks the start of the airline’s “winter” season that runs until April.

“Dubai was always our biggest winter destination,” said Doyle. “It will come back . . . whether it takes a year or two.”

He also called on the UK to cut taxes on tourists to help boost the UK’s economy, warning that the country had fallen behind Japan and other nations that prioritise tourism.

“If you look at France and Spain, they’ve absolutely shot past us, and there’s a number of things in that, but a big part of it is cost,” he said.

If the country wants to hit its target of attracting 50mn tourists annually, up from about 40mn, “and want the economic benefit of that, I think we’re going to have to change the affordability proposition to tourists”.

The government has raised the air passenger duty, a charge paid by airlines that feed through to ticket prices.

“For a family of five coming into the country and travelling, it’s a huge penalty that they have to pay compared to what you pay in Europe,” said Doyle.

The artificial intelligence giant said a “brake pedal” was needed to protect humanity from self-improving models. The proposal could have big consequences.

Andrew here. In 2023, Elon Musk signed an open letter, along with over 30,000 other signatories, seeking a pause on artificial intelligence. Now, Anthropic is suggesting a similar break, arguing the risks could outweigh the rewards. All of this as it plans to go public.

Also: The company behind the S&P 500 has declined to change its rules to quickly add SpaceX to its index after the I.P.O., unlike Nasdaq. (A reminder: Nasdaq won the SpaceX listing on its exchange.) We go into all that below.

Artificial intelligence giants like Anthropic and OpenAI are racing toward blockbuster I.P.O.s that could value them at more than $1 trillion each, on the promise of their rapidly advancing products.

Yet Anthropic’s new suggestion that A.I. labs should weigh pausing work on their bleeding-edge technology — in the name of safety — raises questions about the risks of investing in these companies. (That could have big repercussions if the federal government takes stakes in them, as the news outlet NOTUS reports.)

From a blog post on Anthropic’s website on Thursday:

We believe it would be good for the world to have the option to slow or temporarily pause frontier AI development to enable societal structures and alignment research to keep up with the advance of the technology.

Jack Clark, an Anthropic founder, told BBC News, “Right now, it’s like the A.I. industry has a gas pedal, but it doesn’t have a brake pedal.”

The reason: “recursive self-improvement.” That refers to how A.I. models could soon be able to improve themselves without human intervention. Increasingly capable models and the rise of agents that can run autonomously would make that possible.

As of last month, Anthropic noted, 80 percent of the code added to the company’s code base was written by its Claude model.

Anthropic is proposing the A.I. equivalent of a nuclear nonproliferation treaty:

A meaningful slowdown or pause would require multiple well-resourced labs at or near the frontier, in multiple countries, agreeing to stop under the same conditions. It would also require that each can verify that the others have actually stopped.

The company added that its Anthropic Institute, an in-house research arm, would work on ways to create such a system.

A.I. oversight is an increasingly important concern. Polls suggest that Americans worry more about building guardrails around the technology than about speeding up its development. Even the Trump administration has become more open to actively regulating A.I. companies.

But pausing A.I. development could have serious consequences:

Anthropic and OpenAI have attained astronomical valuations thanks to their rapid growth. (Remember that Anthropic was recently valued at $900 billion.) Disrupting that could crater their stocks and hammer investors.

The system Anthropic outlined would require effective policing of labs and international cooperation among rival nations like the U.S. and China.

Anthropic’s call drew skepticism, including from David Sacks, the administration’s former A.I. czar who has long criticized the company. “In other words, you want the government to save us from… you,” he wrote on X.

Several critics have argued that Anthropic has made fear-mongering a marketing strategy, though industry experts have told DealBook that company executives appear genuinely concerned.

Investors have bet new drugs can topple Merck’s Keytruda, but the evidence so far points to something smaller

Investors have poured billions into the hunt for the next Keytruda. The latest data carries a sobering message: there may be no single successor to Merck’s mega-blockbuster in cancer.

No company is riding that hope harder than Summit Therapeutics. A couple of years ago, the biotech backed by billionaire Bob Duggan published data suggesting its drug, ivonescimab, beat back a form of lung cancer longer than Keytruda did. The stock rocketed, turning a company with no approved product into one worth over $20 billion at its peak, more than Moderna is worth today. Investors began to believe something better than Keytruda had finally arrived.

Yet as more data arrives, Summit’s drug is looking less a Keytruda killer than a contender for a slice of its market. Even after a steep fall this week, Summit is still worth over $11 billion, a rich price for a biotech with no approved drug in the U.S.

Summit and a handful of rivals presented data on the new approach at the recent ASCO cancer conference in Chicago. These drugs build on what Keytruda does by adding a second punch. Like Keytruda, they release the immune system to attack a tumor. In addition, they choke off the blood supply the tumor needs to grow. The idea, in a nutshell, is to switch on the immune system and starve the cancer at the same time.

The results, published in The Lancet, looked broadly positive. Summit’s study showed that patients in China on ivonescimab plus chemotherapy lived a median of about four months longer than those on a rival immunotherapy. That is a win on overall survival, the measure that matters most to doctors and regulators.

But the trial that will make it count in the U.S. hasn’t been reported yet. Data from an international study due later this year will pit ivonescimab directly against Keytruda. Everything hinges on those results.

There are reasons to be skeptical.

Adam Schoenfeld, a thoracic oncologist at Memorial Sloan Kettering, says that if the results hold up outside of China, it could be a genuine breakthrough. This is because the patients being tested have a form of lung cancer closely tied to smoking that has few treatment options.

But he sees reasons for caution. The China trial skewed young. The median patient was 64 and no one over 75 was enrolled. In the U.S., lung cancer is typically diagnosed around age 70.

More troubling, the survival benefit faded among older patients. Women were also sharply underrepresented, and the comparison drug, tislelizumab, isn’t used against lung cancer in the U.S.

The real question is whether this one-two punch innovation represents a true breakthrough.

PD-1 drugs like Keytruda revolutionized cancer care by unleashing the immune system rather than poisoning tumors with chemotherapy. This brought years of remission to a lucky minority. Summit’s drug, a so-called bispecific antibody, aims to evolve that strategy by activating the immune system while simultaneously starving the tumor.

This dual-action promise has sparked a massive dealmaking frenzy, drawing in heavy hitters like Pfizer, Bristol-Myers Squibb, and Merck. At ASCO, promising early-stage data from Pfizer and the BMS-BioNTech partnership proved that this new drug class is the next major battleground in oncology.

But cutting off a tumor’s blood supply has always come with a catch. It is the same mechanism behind Avastin, a drug approved more than two decades ago, and it carries real risks like bleeding, clots and high blood pressure. Those tend to hit older patients hardest.

Pairing it with immunotherapy in a single drug appears to somehow sharpen the benefit while reducing the side effects, Schoenfeld said. But it may also be why that benefit faded in the older patients in Summit’s trial, the very group that makes up most lung-cancer cases in the U.S.

Sean McCutcheon, an analyst at Raymond James, says these drugs have real potential. But they are fighting for pieces of Keytruda’s market rather than the whole of it.

And soon they will face a cheaper rival: copycat versions of Keytruda itself could be on the market by 2028. Tellingly, the whole field is already pushing beyond lung cancer, into tumors like colorectal cancer where Keytruda has largely failed.

Summit’s stock has slid about 16% this week. The caution is warranted.

The era of the single dominant cancer drug may be ending. One medicine approved across dozens of cancers and selling about $32 billion a year is giving way to something more fragmented.

Oil tanker owners fear market crash after Iran war drove record profits

Shipowners ploughed windfall into new vessels and are braced for steep drop in rates if Strait of Hormuz reopens

The world’s biggest oil tanker owners have raised the spectre of a market crash only weeks after the closure of the Strait of Hormuz helped power the industry to a quarter of record profits.

Owners are braced for a steep drop in the rates they can charge to charter tankers in the event that the US and Iran reach a deal to reopen the contested waterway, through which a fifth of global oil supplies typically pass.

Iran’s stranglehold on the strait since the war started in February has delivered a windfall for the industry, with profits surging to $36bn in the first quarter, according to Clarksons, one of the world’s biggest shipping brokers. The previous quarterly record of $26bn was set in 2022.

The risk of a sharp downturn has been heightened after owners ploughed some of their profits into orders for new ships, stoking fears of another boom-and-bust cycle that has been a hallmark of the shipping industry for decades.

The number of the largest oil carriers ordered this year has already surpassed the total for any full year on record, according to maritime data company AXSMarine.

“There is a certainty that it crashes at one point,” said Alexander Saverys, chief executive of CMB Tech, one of the biggest listed shipping companies. “The market has ordered, in my book, way too many ships. Now that will come and bite us eventually.”

The daily rates tanker owners can command have already eased back from the peaks hit in the early weeks of the conflict, when the average cost of hiring a tanker hit $162,992. For the largest vessels, which can carry about 2mn barrels of oil a day, the daily rate soared to $386,685.

The effective closure of the strait has left more than 160 oil tankers stranded in the Gulf, limiting the supply of vessels and driving up shipping rates across the world.

A move by owners to route vessels around the Cape of Good Hope to avoid the Red Sea and potential attacks from Houthi rebels has also driven up rates.

Despite traffic through the strait remaining at a near-standstill, the daily average overall rates for tankers have dropped to between $55,000 and $95,000 for the larger vessels in recent weeks in anticipation of a reopening of the strait. The range is still above the average in recent years of $30,000 to $40,000.

“We need to be very careful,” said Harry Vafias, a major owner of gas and oil tankers, referring to the potential risks facing the industry. “There has been a lot of investment in second-hand and new building [of ships].”

Tanker orders this year are on track to match 2024, which was the third-busiest year since 2000, according to AXS.

The tanker industry would be one of the few industries to lose out if the volumes of shipping traffic through the strait returned to prewar levels. The closure of the vital waterway has sent energy prices surging, hurting multiple industries.

The oil tanker industry is dominated by Greek shipowners, with a working fleet valued at $66.4bn, $26bn more than China, according to shipping technology company Veson Nautical.

While the industry is accustomed to boom-and-bust cycles, a string of global shocks this decade, including the coronavirus pandemic and US President Donald Trump’s trade war, has injected more volatility into shipping rates.

But some executives cautioned that the risk of an industry downturn was overblown, saying that this year’s burst of orders for new ships followed a period of undersupply.

Maria Angelicoussis, chief executive of Angelicoussis Group, a privately owned shipping company, said: “When I look at the tanker market, for example, yes, there’s been an uptick in newbuilding orders in the recent past,” but it comes after a period in which there was a lack of vessels.

It was a view echoed by Capital Maritime Group, which is owned by Greek tycoon Evangelos Marinakis and has placed a large order for new ships.

Others argued that the war would lead to lasting changes in how oil was shipped around the world, supporting the fees tanker owners could charge. The changes include using routes that were less exposed to the threat of conflict.

Angeliki Frangou, chief executive of Navios Partners, a Greek shipping company, told the FT that “excessive newbuilding orders” would push shipping rates lower but the impact would be reduced “by national security considerations of securing reliable energy supply chains”.

Wealthy Russians enjoy many of the luxuries of their prewar lives

Moscow’s Vnukovo airport is home to a sleek white Bombardier Global 7500—a $75 million Western-built jet that caters to the world’s wealthy and business elites.

The jet is one of a number of luxury aircraft used by close allies of Russian President Vladimir Putin—despite Western sanctions aimed at punishing Moscow’s elite over the 2022 Ukraine invasion. Sergey Chemezov, the chief executive at Russia’s giant defense company Rostec, has used the Bombardier jet for trips to Dubai, Turkey and Southeast Asia.

Russia’s elite have been forced to adapt since the start of the war, but Western sanctions haven’t done much to crimp their globe-spanning lifestyles. They have traded places like London, the French Riviera and the Swiss Alps for new destinations such as the United Arab Emirates, Turkey and Azerbaijan.

A Wall Street Journal review of documents from an aviation research firm, import data and flight-tracking records show a number of wealthy Russians close to Putin continue to avail themselves of top-tier business jets from Western aviation companies. A web of companies buys the jets from Western manufacturers or secondhand and registers them in new locations to make them available to sanctioned Russians, the documents show. Those Russians include Chemezov; Arkady Rotenberg, a longtime associate of Putin; and Igor Kesaev, an oligarch involved in arms manufacturing.

Chemezov has been a close Putin ally since the 1980s, when they worked together as KGB officers in what was then East Germany. After rising to power, Putin appointed him as the top executive at Rostec in 2007.

He once enjoyed regular travel to Europe, including estates in Spain controlled by members of his family, according to documents leaked from financial firms in 2021 known as the Pandora Papers.

Since the start of the war, he has had to swap the Mediterranean for Dubai, where he has a villa with a private beach on the man-made Palm Jumeirah archipelago, according to public documents that were earlier reported by Radio Free Europe.

Chemezov used the jet for about half a dozen trips to the U.A.E. between October 2025 and January of this year, according to the flight-tracking firm Flightradar24.

Rotenberg, who trained at the same judo club as Putin in St. Petersburg in their youth, has built his wealth since the Russian president came to power, running banks and construction firms that won lucrative contracts to build infrastructure for the government. He has been under international sanctions over his ties to Putin since Russia seized the Crimean Peninsula in 2014.

He has been using two Bombardier Globals that he got access to in late 2022, according to Ch-Aviation documents. His jets have frequently traveled to resorts in countries that don’t enforce sanctions, such as Azerbaijan and the U.A.E., according to Flightradar24.

Kesaev made his fortune in tobacco and alcohol distribution during the chaotic 1990s in Russia, and then later expanded into retail grocery chains and the arms industry. He is worth $4.8 billion, according to Forbes. He was sanctioned by the U.S. and the European Union after the Ukraine invasion for his role supporting Russia’s arms industry. He imported a raven-black Bombardier Global Express XRS jet in 2023, according to data from Ch-Aviation and Import Genius.

The companies of Chemezov and Rotenberg and a lawyer acting for Kesaev didn’t respond to requests for comment.

Before 2022, many Russian oligarchs relied on European operators—often in low-tax jurisdictions such as Switzerland, Luxembourg and San Marino—to manage their jets. After the invasion, they lost access to those agreements—and in some cases to the aircraft themselves.

Now Russian oligarchs typically get access to Western-made private jets through brokers and intermediary companies. European brokers and aircraft-management firms often acquire Bombardier and Gulfstream jets by purchasing them secondhand from other companies. The aircraft are then registered in jurisdictions that don’t have sanctions on Russia—including the U.A.E., Oman, Kazakhstan and South Africa—before eventually being flown to Russia.

“We have been noticing that some European companies appear to operate in a gray legal area by supplying aircraft to third parties that eventually sell them to Russia,” said Marija Verovic, vice president of marketing at Ch-Aviation.

The aircraft used by the Russians close to Putin were handled by a Vienna-based company called Avcon or its subsidiaries before transitioning to Russian ownership, according to Ch-Aviation documents.

The plane used by Chemezov, for example, was first registered in Bermuda and managed by Avcon before being re-registered in Russia by a company called Tarp Aviation, according to documents in the database. Several jets now managed by Tarp were previously operated by Avcon, the documents show.

“The Avcon Jet Group strictly adheres to EU and U.S. sanctions laws,” the company said in an email. Tarp didn’t respond to a request for comment.

A Vienna-based fiduciary and aviation holding company called SecuTrust owns stakes in both companies. The company didn’t respond to a request for comment.

Companies based in North America and Europe are obliged under sanctions rules to ensure that no aircraft or aircraft parts are exported to Russia. They must conduct due diligence to determine whether clients subsequently resell such items to Russia, according to Felix Helmstädter, a German sanctions expert and lecturer in law at Humboldt University in Berlin.

In some cases, transfers of business jets violate both the general sanctions on exports to Russia and specific sanctions targeting the individuals who ultimately take ownership of the aircraft, he said.

A spokeswoman for Bombardier said that the company has a robust and comprehensive compliance program and takes all reasonable measures to help ensure aircraft aren’t sold or serviced in violation of applicable laws, sanctions or export controls.

Gulfstream didn’t respond to a request for comment.

Moscow has been able to increase imports of Western goods during President Trump’s second term because his administration hasn’t prioritized sanctions enforcement, focusing on narcotics trafficking and Iran instead, said John E. Smith, former director of the Treasury Department’s Office of Foreign Assets Control, the top U.S. sanctions authority.

“Implementing sanctions is like a game of whack-a-mole: It takes significant enforcement efforts to track the evasion and find ways to combat it, and this administration has decided not to focus on increasing sanctions pressure against Russia,” said Smith, now a partner at Morrison Foerster, a law firm.