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The Chinese Dimension of Russia’s Coal Business in a New Environment

By Petr Konovalov – New Eastern Outlook – 16.05.2022

Various projects to do away with coal and switch to other fuels that emit less combustion gases have long been discussed in developed countries. Some experts have even begun to predict the imminent demise of the entire global coal industry. One of the reasons for these forecasts has been statements by China, the world’s main coal consumer, that it also wants to reduce its use of coal as much as possible, along with Western countries.

However, despite all these claims, coal is still the cheapest and most transportable fuel, which no country with a developed industry can do without. The global coal trade continues to grow, generating good revenues for its main suppliers, including Russia.

In 2020, the Russian Federation produced about 401 million tons of coal, 199 million of which was exported to other countries.

In 2021, tensions between the PRC and Australia escalated, causing China to stop importing Australian coal and contributing to an increase in Chinese coal purchases from Russia.

By the end of 2021, Russian coal production was about 440 million tons per year, with 227 million tons exported. Thus, both Russian coal production and exports have shown significant growth. Of the above-mentioned coal exports, 129 million tons were sold to the Asia-Pacific region, which is particularly noteworthy because it is specifically this region that has major coal consumers such as China, South Korea and Japan, making the APR market particularly attractive for all coal exporters. China received 53 million tons of Russian coal, 20 million tons more than in 2020, earning Russia $7.4 billion.

In total, the Russian Federation accounted for more than 16% of the global coal market in 2021, 12% of the APR market and 15% of the Chinese market.

Since the Chinese coal situation came rather unexpectedly, the Russian Federation could not fully replace Australia on the Chinese market: most of Russia’s coal exports had already been allocated to other buyers and there was not enough time to multiply production. As a result, faced with an energy crisis, China started importing Australian coal again in late 2021, partly lifting the restrictions. However, the situation at the end of 2021 and beginning of 2022 still looked encouraging for the Russian coal sector. First, experience has shown that China cannot do without coal; Chinese decarbonization projects, which Beijing has been talking about for years, will not be implemented anytime soon – until then, the Celestial Empire will be importing coal. Second, having experienced power shortages without Australian coal, Beijing was able to see that its reliance on one supplier, Australia, was excessive. The tensions with Canberra in 2020-2021 are just one part of the larger political and economic confrontation between China and the West, and there could be many more conflicts ahead for the PRC and Australia. Therefore, to secure its energy sector, China needs to diversify its coal imports, including by further increasing supplies from Russia.

In February 2022, the media reported that Beijing and Moscow were negotiating an intergovernmental agreement under which coal supplies from Russia to China could be increased to 100 million tons per year.

However, at the end of February, a special operation by Russian troops in Ukraine began and the situation changed dramatically. The West has unleashed a torrent of sanctions on Russia, including Western countries starting to reduce imports of Russian hydrocarbons. In March 2022, for example, Russian coal shipments to the EU dropped by around 50%.

Although China is not an ally of the West, Russian coal exports to the Celestial Empire are also on the decline, as Chinese banks have reduced funding for related operations for fear of Western sanctions. The disconnection of a number of Russian banks from the SWIFT international payment system and the fact that most of the coal purchase contracts were in dollars also played a role: the Chinese side has had difficulty making payments.

Some pro-Western media have concluded that the Russian coal industry has suffered serious damage, that trade with China will not compensate for this damage, and that coal exports may not recover to their previous levels. However, such conclusions are rather premature.

Thus, despite the overall decline in the Russian coal exports to the PRC, exports of coking coal, a type of hard coal particularly valuable for the steel industry, increased in the first quarter of 2022. It can be assumed that the decline in Chinese purchases of other types of coal, which are used for winter heating, for example, may be due to the approaching summer period.

China now has a considerable supply of different types of coal, and in the run-up to the warm season, when there is no need for mass home heating, it can afford to reduce coal imports to explore new conditions. By autumn, however, it can be expected that Chinese-Russian coal cooperation will intensify.

As for sanctions-related difficulties, talks began as early as March between Russia and China on settlements in national currencies and on the use of CIPS, China’s equivalent of SWIFT.

It should further be noted that the Chinese side’s caution over the threat of Western sanctions is also a temporary phenomenon, as the PRC’s relations with the West are not good at all, and China may soon fall under its own sanctions regardless of its relations with Russia. Especially in view of certain features of Chinese foreign policy: on May 6, 2022, for example, some 15 Chinese planes entered the airspace of the partially recognized state of Taiwan, which the PRC considers part of its territory. The Taiwanese have scrambled their warplanes and put their air defense forces on alert. Fortunately, the incident ended peacefully. However, since Taiwan is under the protection of the US military, there is no doubt that the incident will further strain Chinese-US relations, and if it continues, the PRC will soon find itself in the same “sanctions boat” as Russia. In this case, Chinese coal imports from Australia are likely to suffer again.

It can therefore be assumed that China is seeking economic independence from the US and its allies, including from Australian coal supplies, and the Chinese leadership is already working out how to circumvent Western sanctions. One can fully expect that joint efforts in this area will soon allow Russia and China to move towards more intensive trade, including in coal and other energy sources.

May 16, 2022 Posted by | Economics, Russophobia | , , | Leave a comment

What happens if US designates Russia ‘a state sponsor of terrorism’?

By Drago Bosnic | May 16, 2022

The designation “state sponsor of terrorism” is used by the US Department of State to unilaterally sanction countries which the US government claims to have “repeatedly provided support for acts of international terrorism”. The State Department is required to maintain the controversial list under special acts passed by the Congress, imposing various restrictions aimed at the economies and international trade relations of the targeted countries.

As of late 2021, State Department lists Cuba, Iran, North Korea and Syria as “state sponsors of terrorism”, however, there were other countries formerly on the list, such as Iraq, Libya, South Yemen and Sudan. Designating a country as “a state sponsor of terrorism” can affect it in many ways, some of which include:

 – freezing of the targeted country’s financial and real estate assets in the US;

 – requiring the US to prevent efforts of the targeted country to secure World Bank or IMF loans;

 – prohibition on the export of so-called “dual-use products” (items that can be used both for civilian and military purposes);

 – requiring the US to impose economic and other sanctions against countries that continue to do business with the targeted country.

Since Russia started its special military operation in Ukraine, the more hawkish members of the US and NATO establishment have been insisting on the inclusion of Russia on this list. Some, such as the Baltic states, infamous for their virtually endemic Russophobia, already designated Russia as the “state sponsor of terrorism”. Luckily, actions taken by such microstates are largely inconsequential. However, what would happen if some of the larger and more significant NATO and EU members were to take the same course of action?

Considering the controversial designation is aimed not just against the targeted country, but also any third party doing business with it, this would effectively force member states to sanction each other, since many EU and NATO members simply cannot function without trading and dealing with Russia. This includes countries like Hungary, Austria and even Germany, the EU’s largest economy and arguably the most powerful member state. Without Russia’s oil, gas, food, rare earth metals and nonmetals, heavy machinery and many other commodities, these countries would collapse, economically and otherwise.

The designation also directly affects relations within NATO. In case the Congress was to add Russia to the list, possible sanctions wouldn’t just affect the aforementioned EU member states, but also some of the largest and most powerful NATO members, such as Turkey. Ankara has already been sanctioned for the purchase of Russia’s top-of-the-line S-400 surface-to-air missile system. However, the sanctions in the context of trading and dealing with a country designated “a state sponsor of terrorism” would be much more severe. Thousands of private Turkish companies are present in Russia, many of them in the construction business, which directly affects the troubled Turkish economy, currently dealing with enormous inflation and unemployment.

In terms of global relations and trade, such a move would affect the world in ways which are difficult to predict in the long term. However, in short term, it would certainly affect countries such as China and India, dozens of countries in the Middle East, Africa, Latin America and elsewhere, as all these countries would be affected by the third-party sanctions. In doing so, the US would effectively sanction around 80% of the world. This would lead to an uncontrollable escalation of economic collapse in many of these countries, especially in the Middle East and Africa. It would force the US to either implement sanctions on a case-by-case basis, or change the law completely, effectively blunting the effects of sanctions. This would also exponentially accelerate the process of dedollarization, as countries would seek other ways to do business with Russia without US interference.

However, the far-reaching consequences for the global economy would pale in comparison to the resulting security issues. Officially deeming a country with over 6,000 nuclear weapons “a terrorist state” pushes the planet to a brink of a world-ending conflict, as such a designation eases legal restrictions on the use of the US military against the targeted country. Such moves have resulted in rising tensions with North Korea and Iran in previous years. Within the framework of the designation, the US targeted and killed Iranian general Qassem Soleimani in 2020, to which Iran retaliated by targeting US bases in Iraq.

Even at the height of the Cold War, the US did not sanction the USSR with this designation, which is what makes this move even less logical, since the strategic military situation is still virtually unchanged, with both Russia and the US still relying on the mutually assured destruction (MAD) doctrine. Also, Russia is not without options for a reciprocal response, as it could easily designate the US itself as a state sponsor of terrorism. This designation would hardly just be a (geo)political one, as the US has been providing ample support to a wide range of terrorist actors from at least the 1980s to this very day. Former US State Secretary and failed presidential candidate Hillary Clinton openly admitted that Al Qaeda was in essence the mujahideen the US funded and armed to fight the USSR in the 1980s.

The same happened in Croatia, Bosnia and Kosovo during the 1990s, where the US openly worked with Neo-Nazi and terrorist groups to help dismantle former Yugoslavia. During the Arab Spring color revolution which swept through the Middle East and North Africa, the US directly supported dozens of terrorist groups, resulting in the destruction of Syria, Libya and Iraq. US and NATO attempts to rebrand these groups as the so-called “moderate democratic opposition” failed miserably as the terrorists exposed themselves by allying with the Islamic State and even posting videos of gruesome crimes against civilians and POWs. In short, the US should take a long, hard look in the mirror before it even begins contemplating the idea to designate anyone “a state sponsor of terrorism”.

Drago Bosnic is an independent geopolitical and military analyst.

May 16, 2022 Posted by | Economics, Progressive Hypocrite, Russophobia | , | 1 Comment

Ukraine War

BY ISRAEL SHAMIR • UNZ REVIEW • MAY 14, 2022

The immediate beginning of the trouble was a Geneva summit between two presidents that apparently went wrong. We don’t know what went wrong. The pro-Western Russian officials ran away to Georgia and Israel; they are being replaced by anti-Western officials. This East-West break will not be reversed with ease.

Russians are very similar to Ukrainians. Both are stubborn fighters. Throughout the 20th century they chose different strategies: Russians became internationalists, Ukrainians preferred nationalism. The Ukrainian nationalism was anti-Russian, while Russians harbored no negative feeling towards Ukrainians. It was natural for Ukrainians to flirt with anti-Russian powers. Yet when Ukrainian officials began to declare themselves NATO allies, even the most international Russians became alarmed.

Both Rome’s Pope and Noam Chomsky were capable of understanding the immediate casus belli behind Ukraine: NATO had barked at Putin’s door, and he reacted. In December 2021 Putin diplomatically proposed that NATO withdraw to its mid-1990’s line, and moreover he suggested that peaceful discussion about NATO’s borders might prevent future conflict. Putin proposed an international agreement on NATO’s borders, a political solution that everyone could agree on. This proposal was disregarded with nonchalance; NATO refused to discuss the idea. Putin was rightfully irritated. Further attempts to argue across the West/East divide weren’t successful. The West declined Putin’s politics. And the war began.

NATO began shipping in armaments and ammunition, and deployed their spies. Their intelligence gathering allowed them to sink a big Russian ship named Moscow. They provided the coordinates in real-time for Russian ships and planes. From the very beginning it was clear that Russia fights NATO more than Ukrainians, who they consider to be brothers. This wartime pathos was quite an unexpected development. Putin had always been known as a soft leader; he refused to be drawn into wars. Russia has avoided war for many years under Putin’s rule; and generations of Russians have become used to a peaceful and prosperous life. Suddenly, by circumstances beyond their control, they have been switched to life under war and sanctions.

Fortunately for everyone, the war in Ukraine has practically dried up. The Ukrainian leadership desperately begs for UN help to keep the war going, as if the Azov Battalion and the rest of the violent, cruel, thuggish militants need to be paid to shoot people. US Democrats have drafted a nearly $40 billion Ukraine War aid package, which was recently single-handedly blocked by Senator Rand Paul of Kentucky. The Ukraine War has become a political football in the USA. Both the Neocons on the right and the Neoliberals on the left hope to ride this war into Congress.In hindsight there were plenty of warnings. Russians were blocked from the Olympic games by an international conspiracy of blatant hypocrisy. Russian athletes were accused of doping. Now, Western athletes also use doping, but they know how to get around the rules. The Norwegians claimed they have asthma, and they need special performance-enhancing drugs to heal it. The Americans had excuses of their own, and so did the athletes of many other nations. Russian RUSADA man Mr. Grigori Rodchenkov was bribed by the US to deliver proof of Russian doping. The Russians claim the evidence was falsified. In any case the Russian official defected westward, in a step unseen since the Cold War. Russia was tagged as a pariah throughout the games; she was not allowed to play her national anthem nor display her flag. Russians have been persecuted by the Olympic establishment for generations. There is an undeclared war against Russian athletes; here is the full story. The pattern is undeniable. Russian athletes are routinely penalized for activities that other nations practice with impunity. This has to stop.

Russians are unhappy with war as a solution for the Ukraine crisis. They speak of “betrayal”, and that means the political steam behind the offensive is getting thin. Instead, Russians think they can derail the NATO war and the international sanctions by judiciously withholding Europe’s gas and oil. The Arab Oil Embargo brought the US to its knees in the 1970’s using just that strategy. NATO exists to fight wars; bringing war to NATO simply feeds it. The only way to defeat NATO is to starve it. Russia has great quantities of oil, gas and wheat. She produces aluminum, iron, coal, steel, titanium and cheap electricity. The Russian economy has been called “bulletproof” because of its ability to withstand geopolitical shocks.

How exactly are sanctions hurting Russia? Banking freezes are simply pushing Russia into the waiting arms of China, which literally has an unlimited need for Russian energy and commodities. The US Petrodollar is on the cusp of being denominated in Roubles. Stories of boycotts by Twitter, Facebook and Pornhub underscore the ludicrous nature of Western sanctions. “EU blacklists Abramovich, targets energy, luxury sectors…” It seems that only Russia’s Jewish Mafia will be hurt by the international sanctions. The efficacy of Western sanctions is being wildly exaggerated by the Western media and the implacable coming of winter has always been a harbinger of Russian victory. As Biden says, “It will be a very Dark Winter.”

Germany needs Russian energy. It always has. It always will. There is simply no other option for Germany. As the home base of NATO, Germany is in a unique position to forge a lasting peace with Russia. Germans might benefit greatly from increased trade to the East along such routes as the China-Europe Railway Express, but they remain choked by their old millstones. The business of war is no longer profitable. The big players are now supplying China with everything it needs to manufacture the world’s wealth, and Russia is in a unique position to be a major producer. The rest of Europe is also conveniently located to benefit from the new Chinese empire, if they could only cease squabbling long enough to draw a profit. The dying Anglo-American empire is the only entity that profits from division along the Eurasian continent.

May 15, 2022 Posted by | Economics | , , , | 2 Comments

European gas prices forecast to triple

Samizdat | May 15, 2022

A “perfect winter storm” may be forming in Europe, as the continent seeks to limit Russian gas flows, analysts at Rystad Energy said in a press release this week. They added there might be not enough LNG to replace Russian gas during the freezing weather. The price of gas in the EU was projected to soar to $3,500 per 1,000 cubic meters.

According to the report, last year Russia sent 155 billion cubic meters (bcm) of gas to the continent, providing more than 31% of its gas supply.

“Replacing a significant portion of this will be exceedingly difficult, with far-reaching consequences for Europe’s population, economy, and for the role of gas in the region’s energy transition.”

By shunning Russian gas, Europe has destabilized the entire global LNG (Liquefied Natural Gas) market, which began the year with a precarious balance after a tumultuous 2021, Rystad explained. The decision to sharply reduce reliance on Russian gas and LNG from current levels of between 30-40% will transform the global LNG market, it added.

The report highlighted that global LNG demand is expected to hit 436 million tons in 2022, outpacing the available supply of just 410 million tons. “The supply imbalance and high prices will set the scene for the most bullish environment for LNG projects in more than a decade, although supply from these projects will only arrive and provide relief from after 2024,” it said.

According to the research, if Russian gas flows were to stop tomorrow, the gas currently in storage (about 35% full) would likely “run out before the end of the year, leaving Europe exposed to a brutal winter.” Under such a scenario, in the absence of joint buying arrangements and countries competing for limited molecules, the TTF gas price could climb to more than $100 per million British thermal units (MMBtu), resulting in industrial curtailments and widespread fuel switching in the power sector. In an extreme scenario of a severely cold winter, “not even the residential sector would be safe.”

Natural gas prices surged this week after Moscow imposed its first counter-sanctions on some European energy companies. The price of gas in Europe exceeded $1,200 per 1,000 cubic meters during Thursday trading, according to data provided by London’s ICE. Benchmark prices are almost 300% higher compared with a year ago, Reuters reports.

May 15, 2022 Posted by | Economics, Malthusian Ideology, Phony Scarcity | 3 Comments

What Sanctions? Russian Oil Revenues Soar 50%, Hitting A Record High

By Tyler Durden | Zero Hedge | May 12, 2022

And the sanctions hits just keep on coming.

A few weeks after we learned that Russia’s current account just hit an all time high thanks due to soaring commodity exports (just as the US trade deficit blew out to a record high on its own) we learned that contrary to the intentions of European countries, a calculation by a German think tank found that Russia’s oil and gas revenues hit a record high in April, rising to 1.8 trillion rubles in a single month, after 1.2 trillion in March, leading to the following stunning statistics “After only 4 months, Russia’s federal budget has now already received 50% of the planned oil and gas revenue for 2022 (9.5 trillion).”

Today, Bloomberg confirmed this stunning statistic and, citing the latest IEA report, writes that Russia’s oil revenues are up 50% this year “even as trade restrictions following the invasion of Ukraine spurred many refiners to shun its supplies.” Apparently the restrictions – which pushed the price of oil to the highest level in a decade and boosted revenue for oil exporters – is precisely what Putin was hoping for.

Moscow earned roughly $20 billion each month in 2022 from combined sales of crude and products amounting to about 8 million barrels a day, the Paris-based IEA said in its monthly market report.

As we have documented frequently, Russian shipments have continued to flow freely even as the European Union edges towards an import ban, and international oil majors such as Shell and TotalEnergies have pledged to cease purchases. Countering these self-imposed sanctions, Asia has remained a grateful and keen customer, with China and India picking up cargoes no longer wanted in Europe, and doing so at a huge discount to spot.

Even as Russia has kept oil output steady, reduced flows of Russian refined products such as diesel, fuel oil and naphtha have aggravated tightness in global markets, the IEA noted, echoing what we have said virtually every day for the past month. Stockpiles have declined for seven consecutive quarters, with reserves of so-called middle distillates at their lowest since 2008.

For all the disruption, Moscow has continued to enjoy a financial windfall compared with the first four months of 2021. Despite the EU’s public censure of the Kremlin’s aggression, total oil export revenues were up 50% this year.

Hilariously, despite all the posturing and rhetoric, the bloc remained the largest market for Russian exports in April, taking 43% of the country’s exports, the IEA said.

There is some hope yet that Europe’s sanctions won’t be all for nothing: supplies were down 1 million barrels a day last month, and these losses could triple in the second half of the year, the agency estimates. EU sanctions against Russian state-linked enterprises such as production giant Rosneft PJSC will take effect on May 15, and the bloc is moving towards a full ban on the country’s supplies.

“If agreed, the new embargoes would accelerate the reorientation of trade flows that is already underway and will force Russian oil companies to shut in more wells,” the IEA said.

May 12, 2022 Posted by | Economics, Malthusian Ideology, Phony Scarcity, Russophobia | | 1 Comment

Sanctions against Russia: Reactions from the Middle East

By Yuriy Zinin – New Eastern Outlook – 12.05.2022

The Middle East media have not stopped commenting on recent developments in Ukraine through the prism of their perception in the region. Particular attention is paid to the topic of the sanctions imposed on Moscow and their resonance in the Arab world.

As can be seen, attitudes towards these measures are negative in the region. After all, a number of Arab countries that refused to follow the dictates of the US and the West in their policies have been subjected to sanctions.  Their inhumane nature has damaged the economy, led to the death and suffering of civilians, but has not caused the fall of regimes in Libya, Iraq, Syria. However, Arab lawyers remind that in the case of both the Arabs and Russia, the sanctions are unilateral and contrary to the letter and the spirit of the UN Charter.

Observers see duplicity in the authors of these coercive measures under the pretext of “taking over” Ukraine. They are annoyed that action of this kind has not been taken against Israel in many decades of occupation of Arab lands. They note that the media and politicians immediately rushed to condemn Russia in relation to Ukraine, but have been silent for 19 years on the US-British aggression in Iraq and the results of the disaster it has brought to its people. Those results include the destruction of the infrastructure of that country, the economic and humanitarian losses, the distress and impoverishment of the population, etc.

The headlines in the media – “Why is the world paying the price?”, “The conflict in Ukraine and its impact on our weak peoples”, “Will the Arabs starve?” and others – are telling.  Their authors do not hide their concern about the possible consequences of sanctions against Russia, the shadow of which is being cast over the political landscape in the region and wider world.

The rise in inflation that has plagued Europe is somehow being transferred to the Middle East region, pushing up consumer prices for the population. This exacerbates the external debt of a number of countries, especially where it is high: Egypt and Tunisia.

This year, according to the World Bank, global food prices are at their highest level since they began to be formally recorded 60 years ago. At the same time, the cost of grain has risen by 42% this year and that of sunflower oil by 30%, while energy prices have grown by 50%.

Arab countries are major importers of cereals and food products. Here Egypt leads the way (13 million tonnes per year). These countries meet 63% of their needs for grain, 65% for sugar, 55% for vegetable oil, etc. through imports. Meanwhile, they meet 42% of their grain needs from the Russian Federation and 40% from Ukraine.

Russia is also at the forefront of fertilizer production, especially in nitrogen. Fertilizer prices were already at an all-time high before the conflict erupted, affecting overall food security.

The effects, the Arab Monetary Fund suggests, will affect the Arabs in varying degrees. For example, the region’s oil-producing countries will earn more from the energy they sell in 2022 due to a surge in energy prices following the escalation of events in Ukraine. But they will have to increase the cost of importing foodstuffs, especially grain, as well as industrial products and equipment. Those members of the Arab world that import hydrocarbons will be more affected.

Media reports and analysts have sounded the alarm about supply chain disruptions, failures in the supply of some goods, especially foodstuffs.  General tensions could affect the tourism sector, a source of important foreign exchange earnings in a number of Arab countries. All this has the potential for food shortages, the threat of hunger, volatility due to possible outbreaks of discontent, etc.

A number of local analysts are outraged as to why the region should somehow “pay the bills of hatred” of the West towards Russia. Sanctions are designed to bleed Russia white and set it back, but they also make the world pay the price for the US to remain on the throne as the planet’s sole ruler, even if its allies suffer as a result.

Given the impact of the possible detrimental effects of the anti-Russian sanctions, local experts urge the authorities to monitor the situation and act wisely for the sake of their national interests.

In general, it is not in the interest of the Middle East and its individual states to spoil relations with Moscow, as each country has its own ties to Russia. One way or another, countries in the Middle East interact with the Kremlin and therefore need it, Al-Quds stresses.

Observers refer to the fact that their mutual trade has been growing markedly in recent years. They conclude that the Arabs should move in two directions: increasing trade with Moscow, which exceeded $18 billion in 2021, and following India and China in switching to local currencies. In addition, they advise to take advantage of the departure of American and European companies that are investing in the Russian market. Arab capital has great opportunities to take their place and compete successfully in this Russian market.

Russia is a strategic partner of the Gulf countries when it comes to oil and security issues. In these countries, as partners in the OPEC+ agreement, everyone has an interest in the stability of oil prices on world markets. Therefore, a win for one side at the expense of the other would not serve the interest of the balance sought in the hydrocarbon market, but would only risk increasing chaos in the field.

American politicians should understand, commentators argue, that Russia is an organic part of the OPEC+ alliance which will not oppose Moscow or take any part of its oil exports from the market. The Russian Federation will remain in OPEC even after the Ukrainian crisis is over.

Western attempts to press oil-producing countries to increase hydrocarbon production and exports must be seen in the context of the economic diversification policies implemented by a number of Arabian monarchies. They envisage a shift away from oil and gas dependence, innovation in everyday life, etc.

In recent years, Gulf countries have been implementing modernization programs called Qatar National Vision 2030, Saudi Arabia Vision 2030, and Oman Vision 2040, etc. They are dictated by pragmatic considerations and economic benefits that are emerging in the light of new realities.

Arab countries have been victims of the unipolar world since the end of the Cold War, when the era was marked by the US turning their region into a battle and rivalry field, a Jordanian political scientist believes.

Today, in light of the crisis in Ukraine and the accompanying changes looming, they have a chance to make things right. It is a matter of local players using their large financial, economic and natural resources to diversify politics and international relations more actively. So that as they shift their political navigation towards Russia and China, they can have their own say.

Yury Zinin is a senior researcher at the Center for Middle Eastern Studies of Moscow State Institute of International Relations of the Ministry of Foreign Affairs (MGIMO).

May 12, 2022 Posted by | Economics | , , | Leave a comment

Russia sanctions will trigger global food and energy crises – China

Samizdat | May 12, 2022

The international sanctions campaign to punish Russia over the Ukraine conflict will backfire, causing suffering by people around the world while failing to promote peace in the former Soviet republic, a top Chinese diplomat has told the UN Security Council.

“Sanctions will not bring peace but will only accelerate the spillover of the crisis, triggering sweeping food, energy and financial crises across the globe,” Chinese deputy UN ambassador Dai Bing said on Thursday in New York. He added that continuing to impose sanctions on Moscow will force children around the world to “suffer the bitter consequences.”

Dai made his comments as the Security Council met to discuss the humanitarian crisis brought on by the Russia-Ukraine conflict. Although he also spoke of efforts to help protect children affected by the fighting, such as encouraging Russia and Ukraine to work together to enable more civilian evacuations, he said the only real solution is a negotiated peace deal.

“Achieving peace is the best protection for children,” Dai said. “Dialogue and negotiation are the most realistic and feasible way to reach a ceasefire and to stop the war. The international community should encourage Russia and Ukraine to return to the negotiation track and keep accumulating political conditions for the restoration of peace.”

By instead trying to force a resolution through sanctions, Western nations and their allies are actually causing more harm to children, especially those living in such war-torn places as Afghanistan, Yemen, the Horn of Africa and the Sahel region, Dai said. “China again calls on parties to stay rational and exercise restraint, transcend prejudice and strife, and make unremitting efforts for the early resolution of the crisis in Ukraine.”

The US and its NATO allies have spearheaded the sanctions campaign, trying to isolate Russia and devastate its economy and currency. However, the ruble is actually stronger today than before the Ukraine crisis began, rebounding from an historic low reached in March. In fact, it has been the world’s top-performing currency so far in 2022, even though Russia’s economy is reportedly on track to contract by an estimated 12% this year.

Meanwhile, food and energy shortages are looming around the world, and inflation is at around a 40-year high in the US and parts of Western Europe. President Vladimir Putin claimed on Thursday that sanctions are triggering a global economic crisis, and the blame “lies entirely with the elites of Western countries who are ready to sacrifice the rest of the world to maintain their global dominance.”

May 12, 2022 Posted by | Economics, Malthusian Ideology, Phony Scarcity | , , , | 2 Comments

‘Russia not our enemy’: Rep. Paul Gosar

Samizdat | May 12, 2022

Republican Rep. Paul Gosar (Arizona) condemned the push from both parties in Washington to send billions of dollars worth of weapons to Ukraine. “Crippling debt, inflation and immigration problems,” he declared, are not “Putin’s fault.”

Gosar, an immigration hardliner and anti-interventionist, was one of 57 GOP lawmakers to vote against a $40 billion economic and military aid bill for Ukraine on Tuesday. While a number of Republicans have been vocal in their opposition to fueling a “proxy war” in Ukraine, the GOP establishment has shouted down these critics, with conservative talk show host Mark Levin on Wednesday referring to the anti-war contingent of the party as “Putin a**-kissers.”

“Calling us names is not a logical position,” Gosar shot back, stating: “I have no principle to follow but the path of peace and non-intervention. My grown children have known nothing except American war and intervention for naught.”

“Ukraine is not our ally,” he continued. “Russia is not our enemy. We need to address our crippling debt, inflation and immigration problems. None of this is [Russian President Vladimir] Putin’s fault.”

Americans are currently grappling with record gas prices, inflation that’s at a four-decade high, and shortages of vital food products, including baby formula. Furthermore, the expiration of a Trump-era immigration restriction this month will result in up to 18,000 migrants entering the US from Mexico daily, according to estimates from the Department of Homeland Security.

Since the beginning of Russia’s military operation in Ukraine in February, the Biden administration has sent nearly $4 billion worth of weapons and ammunition to Kiev, and revived a World War II-era act allowing a limitless supply of arms to be shipped to Ukraine on credit.

Meanwhile, at home the White House has banned Russian oil and gas imports, and although industry leaders are warning of an imminent diesel shortage, the Biden administration on Wednesday canceled the sale of drilling leases in Alaska and the Gulf of Mexico.

Despite the opposition of Gosar and his allies, the $40 billion funding bill passed by 368 votes to 57. It is expected to pass the Senate by next week at the latest, with Majority Leader Chuck Schumer (D-New York) saying the upper chamber “will move swiftly” to get it to Biden’s desk.

May 12, 2022 Posted by | Economics, Malthusian Ideology, Phony Scarcity, Russophobia | , | 1 Comment

Disney reports $195 million loss in abandoning Russian market

Samizdat | May 12, 2022

The Walt Disney Company published a financial report on Wednesday, claiming it had lost $195 million from shutting down its Disney Channel alone in Russia.

“In the current quarter, the Company recorded charges totaling $195 million due to the impairment of an intangible asset related to the Disney Channel in Russia,” the document stated.

On March 10, Walt Disney announced it was suspending all business activities in Russia due to Moscow’s military operation in Ukraine. Disney’s dealings in the country included content and product licensing, cruise lines, the National Geographic magazine and tours, local content productions, and linear channels.

“After Russia’s unprovoked invasion of Ukraine, we announced that we were pausing the release of theatrical films in Russia and reviewing the rest of our businesses there,” Walt Disney’s statement said. “Given the unrelenting assault on Ukraine and the escalating humanitarian crisis, we are taking steps to pause all other businesses in Russia.”

Since the beginning of the year, Disney’s shares have fallen by nearly 33%, while its main competitor, Netflix, has lost over 72% in value. Netflix’s downturn is attributed in large part to the company’s loss of 700,000 Russian subscribers, after the streaming service also made the decision to bar Russian audiences from its content due to the ongoing crisis in Ukraine.

May 12, 2022 Posted by | Economics, Russophobia | , , | 1 Comment

Russia stops gas transit through Poland

Moscow’s counter-sanctions ban the use of the Polish section of the Yamal-Europe pipeline

Samizdat | May 12, 2022

Russian energy major Gazprom said on Thursday it will not be able to use the Polish section of the Yamal-Europe pipeline for gas transit to Europe due to Moscow’s retaliatory sanctions.

Company spokesman Sergey Kupriyanov specified that the site belongs to EuRoPol GAZ, which is a joint venture between Gazprom and Polish gas major PGNiG. The latter is the operator of the Polish part of the Yamal-Europe gas pipeline.

On Wednesday, Moscow approved a list of companies in respect of which it will apply special economic measures. The list consists of 31 firms, including Polish EuRoPol GAZ, as well as the former German unit of Gazprom. The Russian-owned subsidiary was seized by the German authorities last month and could potentially be nationalized.

“For Gazprom, this means a ban on the use of a gas pipeline owned by EuRoPol GAZ to transport Russian gas through Poland,” the company said on its official Telegram channel.

Russian President Vladimir Putin decreed on May 3 that no Russian entity will be allowed to make deals with those on the sanctions list, or even fulfil its obligations under existing deals.

The decree forbids the export of products and raw materials to people and entities on the sanctions list.

Putin said the decree was in response to the illegal actions of the US and its allies meant to deprive Russia and its citizens and legal entities of property rights or to restrict their property rights.

The Yamal-Europe gas pipeline passes through Russia, Belarus, Poland, and Germany. Russia supplies nearly 40% of Europe’s overall gas demand, and this route accounts for nearly 15% of the country’s westbound deliveries. The pipeline has been operating in reverse mode recently, sending gas from Germany to Poland after Warsaw refused to accept Moscow’s demand to pay in rubles.

May 12, 2022 Posted by | Economics | , , | 1 Comment

Ukraine’s partial gas cut to Europe could force activation of Nord Stream 2

Kiev attempts to blackmail Europe by partially halting gas flow from Russia

By Paul Antonopoulos | Aletho News | May 12, 2022

Ukraine’s decision to partially disable the flow of gas earmarked for Europe will be short-lived as it will not only cause major problems for the European economy, but it will also leave Kiev without billions of dollars in transit tax revenue – something it desperately needs as the economy is in ruin.

The Ukrainian gas transmission system operator (GTSOU) said it decided to suspend operations at a major transit point because of “interference by the occupying forces.” The decision to stop flows from Sokhranivka halts about a third of the Russian gas that arrives in Europe via Ukraine as the measuring station handles as much as 32.6 million cubic meters per day, according to GTSOU.

“As a result of the Russian Federation’s military aggression against Ukraine, several GTS facilities are located in territory temporarily controlled by Russian troops and the occupation administration,” the company said.

Kiev’s idea of transferring gas supplies from Sohranovka to the Suja gas station, which is in Ukrainian-controlled territory, has been dismissed by the Russian state gas company Gazprom as “technically impossible.” In addition, Gazprom said that it fulfills all its obligations to European consumers and delivers gas for transit in accordance with all contracts.

The disrupted transit of one-third of the gas that Europe needs would cause major damage to the continent’s economy. Europe already has less gas than it currently needs and the problem is not just that the price of gas will go up, but there will not be enough needed for industrial production.

If Russian gas does not arrive via Ukraine in the agreed quantity, Europe would have to consider extracting from reserves in underground storage facilities. The price of such gas will certainly be higher than in the case of gas arriving via Ukraine. Therefore, Kiev’s attempts to coax Europe into further involvement in the war with Russia will receive little accolade as it threatens Europe’s economy at a time when it is already suffering.

Kiev’s decision to reduce gas flows to European markets also means that it will suffer as it will lose transit fees that it desperately needs as its economy has stagnated. Another outcome that Ukraine did not consider is that it could force Europe to challenge the US’ opposition to the Nord Stream 2 pipeline. If Russian gas does not arrive via Ukraine, it could be the very catalyst needed to activate Nord Stream 2.

If Ukraine were to remain committed to reducing Russian gas flows to Europe, even at the expense of billions of dollars in transit fees, the question begs whether the EU would be willing to potentially run out of gas and/or see prices rise even further, or activate Nord Stream 2. Activating Nord Stream 2 would effectively mean the US’ failure after so much effort was made to prevent the pipeline from functioning.

For this reason, Ukraine’s decision to halt a third of Russian gas flows to Europe is likely a bluff as it needs all the money it can receive at the moment. At the same time, the Europeans hope to slowly wean themselves off Russian energy, understanding that an immediate cut is not sustainable and would collapse their economies.

Kiev’s incessant demand that Brussels put an embargo on Russian energy imports to the EU will be challenged so long as there are leaders, like Hungary’s Viktor Orban, who prioritize their state’s economy and people’s welfare, or entire major industries are threatened, such as Germany’s manufacturing and Greece’s shipping.

It is quite possible that this disunity and lack of consensus on the embargo in a situation where energy cannot be undermined, could force a rethink of Europe’s policies towards Moscow.

“We will have a peace to build tomorrow, let us never forget that,” Macron said in Strasbourg on May 9, adding: “We will have to do this with Ukraine and Russia around the table. The end of the discussion and the negotiation will be set by Ukraine and Russia. But it will not be done in denial, nor in exclusion of each other, nor even in humiliation.”

On the same day, he said in a tweet: “We are not at war with Russia. We work as Europeans for the preservation of the sovereignty and territorial integrity of Ukraine. For the return of peace to our continent. We will be there to rebuild Ukraine, as Europeans, always.”

However, despite the rhetoric of pan-Europeanism, Macron has already proven in deed that Europe’s elite are still very much under the orbit of Washington. If Ukraine are to partially halt the flow of Russian gas to Europe, the next test of Europe’s so-called “strategic autonomy” would be whether it activates Nord Stream 2 to protect their economic interests or continue following Washington’s demands on keeping the pipeline closed.

Paul Antonopoulos is an independent geopolitical analyst.

May 12, 2022 Posted by | Economics, Malthusian Ideology, Phony Scarcity | , , | 3 Comments

“Political European community” demands policy capitulation without EU benefits

Macron’s “European community” aims to completely align non-EU members with Brussels

Paul Antonopoulos | May 11, 2022

French President Emmanuel Macron said non-European Union countries, like the UK and Ukraine, could be offered a closer relationship with the bloc as part of a new type of “political European community”.

Speaking to the European parliament in Strasbourg on May 9, Macron said such an initiative would allow countries to decide on the level of integration they wanted with the EU. However, this loose form of political association is a rather hopeful attempt to unite all of Europe against Russia under the guise of aligning political and energy demands, but without giving non-EU countries like Ukraine participation in its institutions and financial funds.

It can only be imagined that such a “political European community” would exclude Belarus and Russia, and perhaps maybe even Serbia. The guise of uniting Europe’s energy and political policies will obviously be aimed towards Russia. It is almost certain Ukraine will continue to serve as a hostile country against Russia, except still without the ability to participate in European institutions or financial funds.

“It is our historic obligation … to create what I would describe before you today as a European political community,” Macron said. “This new European organisation would allow democratic European nations … to find a new space for political cooperation, security, cooperation in energy, transport, investment, infrastructure, the movement of people.”

However, it is more likely that the French president’s proposal comes in light of the fact that fatigue from EU enlargement remains ongoing. The inability to realistically expand the EU for new members is certain given all the difficulties the bloc has – from institutional-political crises, to energy problems, to failing to influence events in Ukraine.

Since the EU has opted to blindly follow US policy in Ukraine, even to the very detriment of member-states economies and the living standards of citizens, this proposal for a “political European community” is now an attempt by Macron to create a political manoeuvre to offer not only Ukraine, but probably other member-hopefuls like Moldova and Georgia, the possibility of participating in some form of new political alliance instead of full EU membership.

In this way, these countries would adhere to the political line of the EU but be denied the benefits that these states would have if they had full membership. The “political European
community” is effectively a manoeuvre by Macron to continue the façade that he supports “strategic autonomy” from Washington, something that was proven to be nothing but bravado when this policy was first tested in the context of the Ukraine war. For this reason, Macron is attempting to create an ad hoc framework for the political binding of states that cannot be admitted to the EU and thus force them to be dictated by Brussels on foreign policy matters, a small show of so-called European power.

It is likely that the most targeted countries will be in the Balkans and the Caucasus, but also Ukraine.

Since Kiev has opted for war and is backed by NATO and the EU, inclusion in this new political alliance would be important because they know they cannot achieve full membership, even if some member states, such as Poland and Lithuania, push and give political support.

During his speech, the French president said “we all know perfectly that the process of allowing (Ukraine) to join would take several years, in fact probably several decades.” Macron has not hidden away from the fact that Ukraine’s accession to the EU will likely take decades, but to ensure that Kiev does not give up in this ambition, the “political European community” proposal hopes to entice a capitulation to Western Europe’s interests. The reality is that such a “community” will actually serve as another EU lobby to force states such as Ukraine, Moldova and Georgia to follow Brussel’s geopolitical policies and interests.

Given Macron said a fast-track procedure for Ukraine would lead to lowering standards, in addition to suggesting the country’s accession process could take decades, his statement explicitly rules out full membership only for the sake of joining the blocs political line, which is now one of confrontation with Russia.

There will be an expectation for states to follow the EU’s geopolitical line in the context of the “political European community”, even though this will not contribute to progressing toward their EU membership. At the same time though, it can be expected that non-member countries will be punished in their accession process if they do not follow the EU’s demands.

With sanctions increasingly becoming unpopular in Europe as food and energy prices rise, leading to more countries challenging further sanction packages, adding voices from anti-Russia countries could also be a desperate attempt to make Europe appear far more united than it is. None-the-less, although it is likely that Ukraine, Georgia, Moldova and even the UK would welcome a “political European community”, it remains to be seen how effective it will be, and whether it will make Europe anymore united against Russia.

Paul Antonopoulos is an independent geopolitical analyst.

May 11, 2022 Posted by | Economics, Russophobia | , | Leave a comment

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