Fluff news posted update from USA general basically saying it’s not going to happen, too complicated....
Kruger-Dunning Parts n Service
Fluff news posted update from USA general basically saying it’s not going to happen, too complicated....
Every great cause begins as a movement, becomes a business, and eventually degenerates into a racket - Eric Hoffer
Kruger-Dunning Parts n Service
Apparently the European Commission is going to reduce its Russian gas imports by two thirds this year. I don’t think they quite understand how wartime negotiations work.... Russia will just say hey how about we turn the tap off altogether then.....Originally Posted by Viking01
Every great cause begins as a movement, becomes a business, and eventually degenerates into a racket - Eric Hoffer
Forum whore
It does goes both ways - Europe needs the gas but Russia needs the money, too. If Europe can find an alternate supplier then Russia has lost that income stream. Putins mate who runs Gazprom will not be pleased.
it's not a bad thing till you throw a KLR into the mix.
those cheap ass bitches can do anything with ductape.
(PostalDave on ADVrider)
Geriatric hoon
I wasn't going to answer but I came across that. iI seems genuine the WP are quoting some of it.
It does appear that Blinken blinked.
There is a grey blur, and a green blur. I try to stay on the grey one. - Joey Dunlop
Kruger-Dunning Parts n Service
But if swift is locked their not going to get paid anyway.... and the oligarchs assetts frozen.., literally
Every great cause begins as a movement, becomes a business, and eventually degenerates into a racket - Eric Hoffer
Forum whore
Yes. So how long do you think the oligarchs are going to put up with that? They will only be loyal to Putin as long as their interests are protected. It's just business.
it's not a bad thing till you throw a KLR into the mix.
those cheap ass bitches can do anything with ductape.
(PostalDave on ADVrider)
Anorak
The problem i see is Trump will be i assume promising them a large part of the Ukraine and likely Moldovia.
i cant remember the exact percentage but it was something like 3o people control 60 percent of Russia's total wealth with estimate putting Putin at the richest.
what you will not see is any of the conspiracy theorists or other trump supporters batting an eyelid about this or anty other Russian war crimes
Kinky is using a feather. Perverted is using the whole chicken
The Majestic Metal Wizard
An interesting question.
I guess the question comes down to whether any of them think that if they break ranks, they can avoid a Novichok date.
Physics; Thou art a cruel, heartless Bitch-of-a-Mistress
Hardcore Biker
Evening,
I understand the general point you're making, but I don't tend to agree with your conclusion.
Sanctions
I've spent the best part of the last week reading articles from a wide variety of sources regarding sanctions. Both Western and Russian.
If you filter much of what you've read about western sanctions, they relate to :
(i) western companies choosing to temporarily reduce or cease operation in Russia for the time being (often for products or services that don't have a material effect on a Russian citizen's day-to-day life e.g. MacDonalds, Coca Cola, Starbucks)
(ii) western companies choosing not to supply certain goods and services to Russia for the time being (but which could be resumed if political relationships were to become more favourable again).
Since sanctions upon Russia originally started back in 2014 (i.e. Ukraine coup followed by Crimea annexation), Russia has developed a significant degree of self sufficiency, largely possible due to the country having a wide range of raw material resources.
Internal manufacture and import substitution has occurred for a significant number of products. And the Russian citizen will purchase those goods in local currency (rubles)
[ Financial sanctions relating to currency exchange and cross-border payments are potentially more serious, but even then, the West has already chosen to make selected "carve-outs" (e.g. choosing not to sanction all major Russian banks ; not to sanction flow of payments for goods and services deemed critical to operation of European economies). Supply of oil and gas by Russia is one of these items.
I will ignore any discussion of (i) sale of assets located in Russia owned by western countries (ii) Russian payment of bonds or share dividends owing to foreign banks or other foreign creditors - that is a whole separate discussion. I will also not make any comment on possible Russian restrictions (counter-sanctions) regarding export of critical metals and minerals; again, that is a whole separate discussion. ]
My general conclusion to date is that Russia (and likely China) has anticipated much of the western sanctions program, and has duly prepared for many of the key sanctions since imposed by the West. And through some degree of co-operation (with China), Russia will be able to weather the Western sanctions programme much better than the EU as a whole.
Oil and Gas Supply
My main personal interest over the past week has actually been focused on the oil and gas industry. It's a complicated picture, and you should not necessarily believe western media (reality may be quite different).
My guess is that Russian oil and gas will continue to be consumed by European nations for the foreseeable future, irrespective of the Ukraine situation.
Some points to consider:
1.Sale of Oil and Gas Product to Asia vs Europe
-Russia already has a buoyant market with Asian countries (specifically China - 50 bln m3) while less than supply to Europe - 175 bln m3). Supported by currency exchange arrangement with China using yuan and ruble (not USD) thus avoiding US sanction.
-Despite non-approval and action of new NS2 pipeline, gas has continued to flow to Europe through the existing NS1 pipeline and Ukraine pipelines. Gas flows through Ukraine have actually increased since the start of the Ukraine conflict, with the Ukraine pipeline now currently running at maximum allowable physical throughput (sending gas to EU countries such as Poland and Germany).
-Any projected falls in gas pipeline throughput volumes would in part be offset by significant increase in spot prices (Russian earnings have not been significantly impacted to date). This situation will also partially compensate Russia for the non-start-up of the new NS2 pipeline by German authorities.
Since many western European countries have actively refused to enter into new fixed price contracts for gas, (with many gas contracts expiring and coming due for renewal early 2023), spot prices will mean that they will continue to pay a premium for gas (gas futures prices have virtually doubled the past 10 days).
A number of eastern European nations have also refused to join in sanctions upon Russia, and have instead chosen to ignore an EC mandate.
[ I'm not familiar what currencies will be used, and how they will effect settlement for their gas purchases. Again, China might assist Russia by acting as a transactional intermediary. ]
2.Western Companies Ceasing Operations and/or Sale of Oil Company Assets in Russia
-Russia has frozen the sales of oil company shareholdings (e.g. BP, Shell), and has also signed in law some controls around the sales and repatriation of assets proceeds. Now prohibited for up to 6 months.
[ Asset sales might also end up only being to be made to the Russian government or one of its major oil companies - subject to future decision. ]
3. European and UK Gas Stocks
-European gas stocks currently very low. Current European gas prices will hinder western European nations from rebuilding gas stocks in preparation for the next Winter.
Recovery of normal business activity going into Summer (upon emergence of countries from Covid) may also be restricted due to high gas prices.
Possible alternative suppliers of gas to Europe (such as Norway, Qatar, Africa, Australia) will be constrained:
(i)-Norway: Restricted by its inability to extract more product from their already declining gas fields in the North Sea. [ Confirmed by Norwegian government yesterday.]
(ii)-Africa: Gas pipelines fron north Africa (e.g. Algeria) to Europe mostly terminate in Spain and Italy. Only a few small volume pipelines are available for subsequent reticulation of gas through to major European consumers in northern / western Europe.
(iii)-Qatar: Restricted by virtue of most of its current gas supply contracts being long-term contracts. Existing customers in Asia have been willing to pay higher gas prices. Little ability to ramp up gas volumes (i.e. little spare gas stock available). They would also risk actual physical damage to existing gas fields if they tried to pump in excess of "sensible" throughput volumes (i.e. they risk losing connection to some existing "proven gas reserves" due to salt-water ingress into underground gas field structure).
No existing gas pipelines to Europe, so product must be distributed as LNG. Gas must first be liquefied, then shipped via LNG carrier. This is constrained by factors such as (a) worldwide shortage of LNG transport vessels (b) LNG tankage currently being routed to Asia (c) backlog of LNG ship building in Korean shipyards.
(iv) Australia: Same situation as Qatar. Not able to sell LNG to some alternative markets in Asia such as China (due to current political disagreements arising from the 2019 US-China trade war).
4. LNG Gas Supplies within Europe
-Landed LNG requires re-gasification before being able to be reticulated within Europe. Scarcity of LNG re-gasification plants within Western Europe. Significant capital investment and lead-time on build of new plants and pipelines.
[ Germany was scheduled to have started build of two large new plants prior to the last German election, but that decision was reversed upon change of government.]
-Energy needs (gap) will not able to be met by growing "green" renewables programme.
[ German politicians started talking today about a need to (i) resume use of coal, which was being progressively phased out (ii) continue with operation of 3+ nuclear power plants, currently scheduled for completion of shutdown by end 2022 to meet German "climate change" commitments. ]
5. Cost of Gas within Europe
-Cost of gas to civilian consumers (cooking and heating). High gas prices charged to civilian consumers, with likely associated social upset.
[ Same situation already being seen in the UK, with politicians already telling the UK public they will have to "make sacrifices".]
-Cost of gas to industrial consumers (manufacturing and heating). High gas prices charged to industrial consumers, with increasing loss of competitive pricing of finished products and services.
-Inflationary pressure upon economies. Likely growing unemployment due to reduction in European business activity or business closure.
6. Knock-On Effect of Oil and Gas Supply Restrictions
-Fertiliser: Oil and gas is not only used for heating and manufacture of tangible items - it is also used as a feedstock for products such as fertilisers. Short supply and higher prices will affect operation of agricultural industries in western Europe, and potential volumes of crop food-stocks produced.
-Food Stocks from Russia (and Ukraine): Wheat grain supplies might be sanctioned by Russia in turn (likely if banking and transactional systems prevent settlement of purchases.)
7. Other Oil Supplies to the US
-Russia: Biden made a TV presentation to the US public today, talking about the latest US sanctions on oil imports from Russia, and how devastating they will be for the Russian economy. [ At the same time, the cost of refined petrol within the US has recently risen and broken the $4.5 / US gallon mark for US consumers (up from around $3). This will have a noticeable inflationary impact within the US economy. ]
Only small volumes of Russian crude oil and oil products are affected, but they are still important to the US oil industry. Russia supplies certain grades of oils , desirable for use in blending and for use within US refining plants in southern USA (e.g. Louisiana; Texas). Lack of such products affects both refining column operation and product yields. [ Re blending, this also affects production of diesel, so wait and see issues with diesel production.]
-US Pipeline Completion and Start-Up: Tar oil could be supplied from Canada, but would need to be transported either by rail or via pipeline (from the Canadian border through to Cushing junction, and then on to refineries in southern USA). However, the Biden administration has recently cancelled the completion and operation of the Keystone XL pipeline (in line with US climate change agreement).
-US Shale Oil and Gas: While the exploitation of shale may have pushed the USA to the top of the global oil production "league table", production of shale product is dependent upon continued drilling of new wells (due to shale wells having short lifespans). Many existing US shale drilling companies have already scaled back operation the last 1-2 years, and many are already carrying high levels of debt. Labour shortages due to scale-backs has been a recent problem.
Plus shale oil companies (private companies) are reluctant to increase volume while prices are so high. They’ve said so explicitly, out loud and in public. The big fracking companies — Devon, Pioneer, and Continental — burned by multiple boom and bust cycles over the years, pledged in February not to increase production until 2023.
The US has made "verbal promises" of being able to ship shale product to Europe, in order to make up for projected Russian shortfalls (due to some Europe countries choosing to reject Russian product). But many of the major US shale gas fields are already "mature", and the US may not be able to meet proposed supply commitment to Europe (due to a need to supply product to its own domestic market). The situation may be compounded by increasingly heavily cold/stormy winters being experienced in the US (due to climate change).
https://www.euronews.com/green/2022/...imate-concerns
[ Edit 1 : The key point to consider is that Biden has stipulated a deadline - 6 weeks away - before Russian crudes will not be accepted. The US now has the issue of finding other sources able to replace the Russian "heavy" crude volume foregone (assuming they chose not to change their refining configuration. ]
Edit 2 : Another complication for the US is that shale oil tend to be "light" crude, while crude oil from Russia (and Venezuela) tends to be "heavy", hence US refineries in the southern USA tend to be configured more towards processing of "heavy" crudes (i.e. those provided by their main suppliers). This makes processing of shale oil for internal US consumption less attractive to US refiners.
Edit 3 : Even if refining of shale oil by US refiners was not so restricted, could shale oil drillers ramp up production output ? Looks like the answer might be No.
https://www.zerohedge.com/energy/its...raising-output ]
This means that the US will have to look at other sources of feedstock and finished product (e.g. Venezuela, Iran, Saudi and UAE)
-Venezuela: US officials have been in discussion with Venezuelan officials this last week, as to whether Venezuela would join the global group applying sanctions against Russia. Venezuelan oils and oil products are also highly desired by US oil refiners (for the same reason as Russian oil products now under import sanction).
[ Past coup attempts - as well as active sanctions and economic destabilisation attempts - against Venezuela will be unlikely to gain their agreement. Both Russia and China have actively invested in the Venezuelan oil industry in order to prevent its collapse. ]
-Iran: Trump unilaterally pulled the US out of the JCPOA back in 2016, and then applied strong financial sanctions against Iran (in order to bring about regime change). The return of Iran to the global oil export market would return 1.5 -2 million barrels per annum, which would help reduce global oil prices (recently peaking around $130-135 / barrel Brent). But Russia (as a JCPOA signatory) has refused to give approval - with Iranian agreement - to the renewed JCPOA contract if it would still be liable to arbitrary US sanctions (against either Iran and/or against Russia).
[ Active sanctions and economic destabilisation attempts against Iran will be unlikely to gain their agreement. Both Russia and China have also actively invested in the Iranian oil industry in order to prevent its collapse. ]
-Saudi and UAE: Both countries have turned down calls from Biden within the past 24 hours, where the calls were expected to centre around joining in sanctions against Russia, as well as to increases in their own output levels (in order to help reduce global oil prices).
[ Edit 11.03.2022 ]
The following article mentions some other points that I didn't mention in the earlier post:
https://sputniknews.com/20220310/fir...093752438.html
Forum whore
Appreciate the detailed and reasoned reply, thanks.
it's not a bad thing till you throw a KLR into the mix.
those cheap ass bitches can do anything with ductape.
(PostalDave on ADVrider)
Hardcore Biker
Thanks. A complicated situation all round, not just in the one aspect that I tried to outline.
Only my 2c worth, and I could well be proven wrong. On this point and others.
Cheers, Viking
[ Edit ]
If we widen our attention on energy supply to include nuclear (and believe some of the Russian press), it appears that the US is also willing to do energy related sanction carve-outs :
https://sputniknews.com/20220309/us-...093721032.html
The article is also notable in that it mentions the US-Russia uranium fuel deal that was concluded back in 1993, which represented extreme windfall profits for the US nuclear industry as a result (ROI was reported separately at around 3,700%).
Geriatric hoon
Thanks, that took a considerble amount of work.
The British Prime Minister has produced a six point action plan. This though is an old joke, the plan is likely the only action that will ensue. There are a number of Russians who have been on the sanctions list of other coutries for some four years. None are as yet sanctioned in Britain, they still own prime real esate in and around London, and in some cases their kids still attend private schools.
Against the advice of the security agencies, Johnson even made one of oligarchs a member of the House of Lords. The current British government is indebted to the oligarchs for financial assistance and is unlikely to do anything that will cause the money supply to dry up.
It's being reported that Biden tried to call the leaders of Saudi Arabia and the United Arab Emirates but they refused to take his call.
There is a grey blur, and a green blur. I try to stay on the grey one. - Joey Dunlop
Hardcore Biker
Morning.
Thanks. Yes, an hour or three.
Interesting times ahead. I watch with interest not only how the Ukraine situation resolves itself (only but one act in this whole geo-political play), but more how the whole sanctions business unfolds and plays out within Europe (and the UK).
Irrespective of what position you chose to take, all the various sanction actions taken by all manner of players in the West - aided by the unprecedented western media storm that has accompanied them - have seriously poisoned Russian - European political and economic relations for the short to medium term.
It may take the best part of 12 months before the full effects of the sanctions are felt. But any chances of a strong Europe - Russia - China trading bloc developing (supported by BRICS infrastructure) have just been shot down faster than a Zircon missile.
No doubt, a few global political players will be pleased with that outcome.
As for the whole NATO expansion and missile location topic (comprising the basis of Russia's original points of contention), I suspect that discussion has only been deferred.
[ Edit ]
https://apnews.com/article/russia-uk...47d2c7052f898f
Well, this is awkward...
You’re obviously much better informed than I, so what did Putin expect to happen? The ‘Ukrainian situation’ appears to me to be entirely of his own making, and he’s made it much worse. For both sides.
I can understand Russia being wary of it’s European neighbours, especially in the light of WWII and the Cold War, but surely the only threat from NATO in this day and age is idealogical, not territorial? Will the next generation of Russian leaders with no memory of the Cold War care so much about former Soviet or Imperial possessions?
Moe: Well, I'm better than dirt. Well, most kinds of dirt. I mean not that fancy store bought dirt. That stuffs loaded with nutrients. I...I can't compete with that stuff.- The Simpsons
Hardcore Biker
Afternoon,
Thanks for the invite to comment, but I'll kindly decline to try and answer. This is a fairly "hot" topic at the moment, and I don't particularly want to comment on Putin and his possible intentions. I think that the man has already spoken clearly enough in the international forum, to those willing to listen and understand the Russian perspective.
Even if I tried to offer what I thought was a "balanced" answer (interpretation), any showing of favour for the Russian perspective would result in the inevitable "Putin apologist" label. Sorry, I can do without that.
Cheers, Viking
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