Under intense lobbying from the White House, chief executives of leading U.S. corporate and Wall Street interests have reluctantly agreed to skip an upcoming economic forum in Russia.

The Obama administration has targeted participation in the Saint Petersburg International Economic Forum, President Vladimir Putin’s annual event to tout Russia’s economic importance, as yet another way to punish the Russian leader for actions in Ukraine. The U.S. view is that the attendance of the CEOs themselves would serve as a propaganda tool for Putin, evidence that the West’s efforts to isolate him have been ineffective.

Prior to the upheaval in Crimea and eastern Ukraine, many leading U.S. companies and firms had planned to partake in the forum, just as they did last year. This year’s attendees were supposed to include CEOs from Alcoa, Goldman Sachs, PepsiCo, Morgan Stanley, ConocoPhillips and others.

But leaders from all the aforementioned businesses have agreed to pull out of the event, according to The New York Times.

Not that the CEOs were happy about their decision. Many have privately grumbled about being caught in the middle of the Washington-Moscow friction over Ukraine, fearing that no matter what they do, they risk making an enemy of either Putin or President Barack Obama.

“Nobody wants to get caught on the wrong side of anybody in this if they can help it,” one industry official who asked not to be identified told the Times. “Some companies are trying to do their best to avoid getting trapped in this minefield.”

Corporate investments in Russia are extensive for some of these organizations. Agricultural producer Cargill has sunk more than $1 billion in the country and has more than 3,000 employees at work there. For PepsiCo, Russia is its second largest market in the world, bringing $4.9 billion in revenue last year.

If the CEOs ignore Obama’s call to skip the forum, they could wind up on his “dog list,” one source put it.

If they abide by the White House’s wishes, they could lose new business deals with Moscow, which could opt to go with a European or Asian competitor, the official said. Additionally, boycotting the event and incurring Putin’s wrath could put at risk CEOs’ existing operations in Russia, as well as the security of thousands of corporate employees.

A third option, which some companies plan to try, will involve sending lower-level executives to the meeting scheduled for May 22-24.

In the meantime, Putin’s government is trying to show the event will still go on with many prominent Western business leaders.

A number of American CEOs who have already announced they won’t be attending the event are still listed on the forum’s website as “participants.” Among them is a photo of Lloyd Blankfein, chairman and chief executive of Goldman Sachs. However, a Goldman executive reportedly told the Times that there was virtually no chance that Blankfein will attend unless peace suddenly breaks out in Ukraine.

So far, indications are that attendance at this year’s forum will be about 40% lower than last year, according to the Russian newspaper Kommersant.

Putin is portraying himself as sympathetic to Western CEOs’ predicament. “This was not a decision the companies made themselves,” Putin press secretary Dmitry Peskov told an interviewer on the Ekho Moskvy radio station. “This was rather a forced measure; they chose not to attend under a sudden pressure.”

-Noel Brinkerhoff, Danny Biederman

To Learn More:

Obama Aides Tell Executives to Skip Forum (by Peter Baker, New York Times)

U.S. CEOs Shun St. Petersburg Forum But Send Their Deputies (by Alexander Panin, Moscow Times)

Sanctions against Russia? Don’t Tell ExxonMobil (by Noel Brinkerhoff, AllGov)