As politicians in Cyprus scramble to clinch a bailout deal to avert a collapse of its banking sector, Rosneft and BP finalized a deal to create the world's largest listed oil major, an agreement Rosneft's CEO hailed as "more important than the situation in Cyprus".
Rosneft completed the acquisition of BP subsidiary TNK-BP on Thursday. It gives BP a near 20 percent stake in the Russian oil firm. The U.K.-listed oil giant announced Friday that it will buy back $8 billion of its shares, and return some of the proceeds to shareholders. Its stock rose 2.83 percent in morning trade on Friday.
"For two companies on a corporate level to conclude a big deal like this is a historical moment and for us on the corporate level this is more important than the situation in Cyprus," Igor Sechin, Rosneft's CEO told CNBC.
"Part of the deal took place in Cyprus among other places, in offshore zones in the Caribbean and in Europe but everything was organized in such a way that we did everything in a professional manner."
(Read More: Russia Creates World's Largest Listed Oil Major)
The Russian oil company, majority-owned by its government, now becomes a bigger oil producer than Exxon Mobil. Sechin told CNBC it is now the world's leading energy company with annual production volumes of 210-215 million tons (47 billion cubic meters of gas and 95 million tons of processed products).
"We are extremely pleased to be now nearly a 20 percent shareholder in Rosneft. It's a historic day," Bob Dudley, group chief executive and a director said.
"The cooperation between Rosneft and BP has been outstanding over the last six months to bring together the largest acquisition in the oil industry ever."
(Read More: BP CEO: '2014 Is When Things Start Moving')
Dmitry Avdeyev, who has been managing the finances at Rosneft resigned on Friday, according to local press reports. Avdeyev, a former investment banker at Morgan Stanley left by "by mutual consent", news publication Vedomosti said.
For BP, this brings an end to the saga of months of on-off negotiations as the energy firm continues a court battle with U.S. authorities over its 2010 oil spill in the U.S. Gulf.
After the $8 billion share buyback BP retains another $4.48 billion in cash received for its stake in TNK-BP. The company has said it will use to pay down some of its debt, but told CNBC it has not yet decided whether this money will be used to offset the losses made during the Macondo oil spill.
(Read More: BP Fights Off Up to 50,000 Cyber-Attacks a Day: CEO)
Manoj Ladwa, head of trading at TJ Markets told CNBC Friday that the buyback will "set a trend for BP" but doubts its share price can rise back up to the 7 pound mark that it was at before the oil spill.
"It's not the most dynamic of strategies," he said regarding the buyback and urged BP to acquire other smaller companies in order to see its share price back move higher.
—By CNBC.com's Matt Clinch