U.S. sanctions Russian mining giant and one of the world's largest zinc mines was included in the "blacklist"

The Office of Foreign Assets Control, an agency of the U.S. Department of Commerce, released the latest sanctions on Tuesday, which updated the sanctions list against Russian-related individuals and entities, and Russian mining giant Vladislav Sviblov became the latest business person to be included in the "blacklist".

Not only is Sviblov personally famous, but several mining companies associated with him have also been sanctioned by US officials. The company controlled by Sviblov occupies a dominant position in Russia's gold mining industry, and its mining volume ranks third in Russia.

Also affected by sanctions is Ozernoye, a company developing one of the world's largest zinc mines. The mine's output is expected to account for 4% of global production and is regarded by the market as an important supplement in zinc supply. However, the mine suffered a sudden fire last month, and its production is expected to be delayed until 2024.

Even if the mine comes online next year, it will be difficult for Western companies to trade with Ozernoye Mining due to U.S. sanctions. According to reports, international giant Trafigura, Sweden's Open Mineral and other companies have previously expressed interest in the mine and have been bidding in the hope of reaching a long-term contract to purchase zinc ore.

When Russia's Minister of Far Eastern and Arctic Affairs Aleksey Chekunkov inspected the Ozernoye mine last year, he said that if operated at full capacity, the project would become one of the largest zinc mines in the world.

In recent months, zinc ore prices hit historically low amid expectations of rising production and a massive supply glut, leading to news of mines limiting output. As of the end of September, Macquarie Bank calculated that the total annual zinc production closed this year reached 300,000 mt.

Ozernoye has therefore become the focus of much attention in the zinc ore supply chain that is increasingly under pressure. One of the reasons why the market remains calm about the continuous reduction of zinc ore production capacity is that Ozernoye is about to be put into production. But last month's fire disrupted market expectations, causing zinc ore prices to fluctuate sharply.

The impact of the fire on mine production capacity is still being evaluated in more detail, and the latest sanctions from the United States have once again dealt a blow to the market.

On Tuesday, the spot price of zinc on the London Metal Exchange edged up 1.4%, while the price has fallen 9% from the recent high hit in November.