Oracle Limits Software Supplies to Rosneft and Gazprom

One of the world's leading business software producers, the American Oracle, has restricted the terms of deliveries to Russian oil and gas companies under US sanctions. This was stated in a letter from the company to clients dated January 12.

• The ban is on software supplies for offshore exploration and production projects involving companies that fall under US Directive 4 , the sanctions against the Russian oil and gas sector introduced in September 2014 and updated in October 2017. The ban applies to projects that started on or after January 29, 2018. The restriction also applies to any renewals or extensions of existing contracts.
• The American company attached a list of 283 companies that fall under the restrictions to its letter. Among them are Gazprom, Rosneft, Surgutneftegaz and LUKOIL.
• According to a Kommersant source in one of the oil companies, the ban on Oracle software will cause “great damage” to the industry – Russian oil and gas companies are very dependent on foreign software. The publication’s source in a large IT distributor also says the same thing.
• At the same time, Kommersant clarifies that large customers of Oracle software, such as Rosneft or Gazprom, have structures and third-party businesses that are not directly related to oil production, and they can avoid restrictions. “With many companies on the sanctions list, the case-by-case approach works, and often the issue can still be resolved,” the newspaper’s source explains.
• The situation with Oracle is not the first case of restrictions on software supplies due to American sanctions. In January, two Russian distributors of Microsoft tightened the rules for selling its software to more than 200 Russian companies.

What do I get out of this?

Sadly, all Russian businesses need to think about alternatives to American software so that new bans or restrictions do not come as a surprise - US suppliers are tightening their conditions one after another.

Artem Gubenko, The Bell