Ukraine reacts to fears of Russian invasion as troops build up at the border

[Solauren]

Alt - They honestly don't give a shit, and are just putting out those statements and claims for their own amusement. In effect, trolling the world.

[LadyTevar]

Alt - They honestly don't give a shit, and are just putting out those statements and claims for their own amusement. In effect, trolling the world.

Or... the Kremlin is truly that out of touch with reality.

[Zaune]

There's no possible answer to this question that would make us feel better, is there?

[Lord Revan]

There's no possible answer to this question that would make us feel better, is there?

Nope, none what so ever. Though look at it from the bright side it doesn't take less then 5 hours to drive to your home town from St. Petersburg (well at least the St. Petersburg that's in Russia).

[Solauren]

There's no possible answer to this question that would make us feel better, is there?

It's a computer running a script in a bunker they lost the keys to, so they can't shut it down?

[Zaune]

Nope, none what so ever. Though look at it from the bright side it doesn't take less then 5 hours to drive to your home town from St. Petersburg (well at least the St. Petersburg that's in Russia).

True. But it's not like we're beyond the reach of long-range bombers or submarine-launched cruise missiles, even if they'd have to be running very low on worthwhile targets by the time I was in the direct line of fire, so that's not entirely comforting if Putin decides to try and outflank the Ukrainians by sending a few divisions into Poland or something.

It's a computer running a script in a bunker they lost the keys to, so they can't shut it down?

Hah! If only.

[Ralin]

There's no possible answer to this question that would make us feel better, is there?

I expect it's a combination of them being 'out of touch with reality' in the more mundane sense that they made wrong assumptions about how various foreign governments and groups of people (including many of the actual Ukranians) would react to their invasion, that a lot of what they say is straight up propaganda for internal consumption, that they legit have a theory of the war and geopolitics which they believe but the rest of the world doesn't share (Russia is acting appropriately by securing their borders and their historic terrority and sphere of influence and that their actions are ultimately defensive against the US-led NATO order), and also that there are issues with the left hand not knowing what the right hand is doing at the time.

You could collectively describe all this as the Russian government being out of touch with reality and you wouldn't be wrong, but none of that is, like. Delusional.

[wautd]

There's no possible answer to this question that would make us feel better, is there?

straight up propaganda for internal consumption

And sadly, I see plenty of useful idiots and the typical conspiracy nuts in outside countries who are eating up Russia's propaganda like candy too. I guess that Russian state media bombarding the world for years with misinformation combined with a few years of the Covid pandemic was a perfect shitstorm to radicalize gullible people

[madd0c0t0r2]

I'm wondering about the grain snafu.

One branch of the Russian government is negotiating with Ukraine, turkey and UN to open a route to ship grain supplies out under Turkish flags.

The agreement is signed, it's a big deal.

Then 4 days later 4 missiles are fired at Odessa docks. It's being painted as 'lying Russians' in places, but I trying to figure out why. I'm going to assume Russian media could easily sell it to their public as a humanitarian concession, so it's not that.

Options

1) genuine fuckup and lack of info. Missile command gets satellite data of activity at Odessa docks, assumes it's supplies and bombs it.

2) internal wars - one group in Russian military will not accept any negotiation and will poison the well to avoid being softly talked down from their glorious righteousness empire building.

3) bigger fish - they were targeting someone important in Ukraine, had intel they were there and figured the UN is desperate and will forgive as long as the grain gets delivered later

4) shift credit. They want the grain to be redirected to a different major port on the black sea, one they control or could control.

5) rationally mad. They already have a bad reputation in negotiations, so time to commit to that image in order to wrest more concessions through unreasonable negotiation in future

[EnterpriseSovereign]

EU agrees plan to ration gas use over Russia supply fears.

EU energy ministers have agreed to ration gas this winter as the bloc's member states attempt to avoid an energy crisis generated by further Russian cuts to supply.

On Tuesday EU members approved a proposal for all the bloc's countries to voluntarily reduce gas use by 15% from August to March.

Under the agreement, which only Hungary opposed, gas demand reduction would become mandatory if supplies reach crisis levels.

Countries such as Ireland and Malta that are not connected to other member states' gas networks will be exempted from the binding 15% gas cut.

Those with a limited capacity to export gas to other EU countries, such as Spain, can ask for a lower target, provided they export what they can.

European Commission President Ursula von der Leyen welcomed the proposal, saying in a statement that “the EU has taken a decisive step to face down the threat of a full gas disruption by Putin.”
"You will not split us," German Economy Minister Robert Habeck said, adding that the agreement was a show of European unity in the face of Moscow's latest gas cuts.

His comments came after Russian energy giant Gazprom said it would limit supplies to the EU through the Nord Stream 1 pipeline to 20% of capacity, heightening concerns that Putin will use gas trade to challenge the bloc’s opposition to the war in Ukraine.

Gazprom has cut gas supplies altogether to Bulgaria, Denmark, Finland, the Netherlands and Poland over their refusal to go along with a Kremlin order to pay their bills in roubles and not dollars or euros.

Russia, which supplied around 40% of EU gas before it invaded Ukraine, has been accused by Kyiv of waging a "gas war" against Europe and cutting supplies to inflict "terror" on people.

Although it has agreed to embargo oil and coal from Russia starting later this year, the EU has refrained from sanctioning Russian natural gas because Germany, Italy and some other member states rely heavily on these imports.

While Tuesday's proposal was hailed by many ministers as a success, some countries raised concern that the savings would not be enough to avert a winter shortage.
"15% will probably not be enough, given what the Russians have just announced," Irish Environment Minister Eamon Ryan said.

Putin is taking a gamble, hoping that by driving up gas prices other countries will feel opposition by their own citizens over sky-high energy prices. It's also Russia cutting off their noses to spite their faces as gas is one of Russia's few sources of income and will impact their ability to finance their invasion.

[Solauren]

Sometimes I wonder if some some Hedge Fund manager is advising Putin on this....

"Start a war, cut off gas supplies to drive up the prices, then sell it all at peak price"

[LadyTevar]

If this is the problem in the EU...

... Then why is there now rumblings in the US about a Massive Natural Gas Hike for this winter?
Once again, WE DRILL OUR OWN NATURAL GAS! WE DON'T USE RUSSIAN GAS!

Money-gouging mother fuckers.

[Ralin]

If this is the problem in the EU...

... Then why is there now rumblings in the US about a Massive Natural Gas Hike for this winter?
Once again, WE DRILL OUR OWN NATURAL GAS! WE DON'T USE RUSSIAN GAS!

Presumably because its price still doesn't exist in a void and is affected by global demand because there are multiple countries and groups willing to buy it.

[J]

If this is the problem in the EU...

... Then why is there now rumblings in the US about a Massive Natural Gas Hike for this winter?
Once again, WE DRILL OUR OWN NATURAL GAS! WE DON'T USE RUSSIAN GAS!

Money-gouging mother fuckers.

The US has been exporting a lot more natural gas than usual to Europe and other places which are experiencing shortages.
Welcome to the global market, where everything is for sale to the highest bidder.
Also, congratulations on having a stupid energy policy.

P.S. You guys also sold a bunch of oil from the strategic petroleum reserve to China and other less than friendly countries. Did I mention stupid energy policies yet?

[MKSheppard]

If this is the problem in the EU...

... Then why is there now rumblings in the US about a Massive Natural Gas Hike for this winter?
Once again, WE DRILL OUR OWN NATURAL GAS! WE DON'T USE RUSSIAN GAS!

Money-gouging mother fuckers.

Because all that US natural gas is going to Europe this winter, to keep them from freezing. The Germans have been building an offshore LNG terminal in record time.

[MKSheppard]

Did I mention stupid energy policies yet?

Remember this from 2018?

https://www.washingtonpost.com/world/20 ... t-smirked/

BERLIN — Out of President Trump’s speech at the U.N. General Assembly on Tuesday, it probably won’t be the script that will be remembered by diplomats but, rather, world leaders' laughter, caught on camera and shared in viral videos.

One of them captured the amused reactions of the German delegation as Trump said: “Germany will become totally dependent on Russian energy if it does not immediately change course. Here in the Western Hemisphere, we are committed to maintaining our independence from the encroachment of expansionist foreign powers.”

German Foreign Minister Heiko Maas could be seen smirking alongside his colleagues.

[EnterpriseSovereign]

Did I mention stupid energy policies yet?

Remember this from 2018?

https://www.washingtonpost.com/world/20 ... t-smirked/

BERLIN — Out of President Trump’s speech at the U.N. General Assembly on Tuesday, it probably won’t be the script that will be remembered by diplomats but, rather, world leaders' laughter, caught on camera and shared in viral videos.

One of them captured the amused reactions of the German delegation as Trump said: “Germany will become totally dependent on Russian energy if it does not immediately change course. Here in the Western Hemisphere, we are committed to maintaining our independence from the encroachment of expansionist foreign powers.”

German Foreign Minister Heiko Maas could be seen smirking alongside his colleagues.

Even a broken clock is right twice a day.

[Batman]

Or once if it's a digital one. And I think we found out relying on russian gas was a stupid idea the hard way. As was killing nuclear.

[EnterpriseSovereign]

Or once if it's a digital one. And I think we found out relying on russian gas was a stupid idea the hard way. As was killing nuclear.

You can trace the latter to their knee-jerk response to the Fukushima disaster. Maybe the time has come to have another look at fracking in the meantime.

[Broomstick]

If this is the problem in the EU...

... Then why is there now rumblings in the US about a Massive Natural Gas Hike for this winter?
Once again, WE DRILL OUR OWN NATURAL GAS! WE DON'T USE RUSSIAN GAS!

Money-gouging mother fuckers.

Because if Russian gas is off the table then you have the same number of people chasing a smaller amount of gas on the global market which drives up the price of gas everywhere. Good, capitalistic gas producers in the US will have the choice of selling their wares to the US at one price or selling it overseas at a much higher price... so as good capitalists they'll follow the money, leaving less gas to be sold in the US, which will drive up prices in the US. A scarce commodity costs more.

[EnterpriseSovereign]

If this is the problem in the EU...

... Then why is there now rumblings in the US about a Massive Natural Gas Hike for this winter?
Once again, WE DRILL OUR OWN NATURAL GAS! WE DON'T USE RUSSIAN GAS!

Money-gouging mother fuckers.

Because if Russian gas is off the table then you have the same number of people chasing a smaller amount of gas on the global market which drives up the price of gas everywhere. Good, capitalistic gas producers in the US will have the choice of selling their wares to the US at one price or selling it overseas at a much higher price... so as good capitalists they'll follow the money, leaving less gas to be sold in the US, which will drive up prices in the US. A scarce commodity costs more.

The UK is experiencing increases in energy prices and has done for months, since before the Russian invasion. We only get 4% of our gas from Russia, Shell is going to develop infrastructure in the North Sea so we can produce more gas domestically.

[His Divine Shadow]

Pretty fucking stupid to get reliant on gas and idiot renewables that require fossil fuel backups to work more than half of the time. Energiewende could as well have been a russian sting operation to fuck over europe.

[Spice Runner]

(deleted)
Duplicate Post sorry

[Spice Runner]

The affects of large Asian oil consumers like China and India buying Russian oil like there is no tomorrow because of discounted price will have likely have effects on the middle east Gulf and Iran and the rest of the region .

The war in Ukraine and the new reality in Asian oil markets

One of the main long-term consequences of Russia’s invasion of Ukraine is the restructuring of export flows in the global oil market. This will have direct consequences for Middle Eastern players, forcing them to choose whether to compete with Russia and each other or continue to coordinate their efforts.



In spite of the rumors that Russia might be suspended from the OPEC+ deal, the current cooperation between Moscow and other oil producers may still survive and continue beyond September 2022, when the agreement on production cuts expires, although the chances of this happening are decreasing. There are ongoing concerns about the stability of the oil market and keeping the cartel together is the only way to manage it. Even though its production capacity is declining, Russia remains an important player and one whose role in Asia, a key consumer market for Gulf oil producers, could potentially increase. If there were questions during the first weeks of the conflict in Ukraine about whether the threat of sanctions and logistical bottlenecks would allow Moscow to redirect its oil exports from Europe to Asia, by now the answer is clear: yes, it can. For example, in the case of oil terminals in the west of Russia, the volume of oil supplies going to the “East” increased from 0.14 million barrels per day (mbpd) in January 2022 to 0.9 mbpd in April and 0.55 mbpd in May.

Putting aside its initial fears and hesitation, India turned out to be the main buyer of extra volumes of Russian oil. From almost zero in February, its imports rose to 0.9mbpd in May; in previous years its average imports did not exceed 0.2mbpd. China quickly followed India’s example. Interest in additional supplies emerged not only from traditional buyers of Russian hydrocarbons among China’s independent oil refining companies (so-called teapots), but also from major Chinese players affiliated with the government, which had initially said they would not be interested in buying Russian oil due to the threat of sanctions. However, as statistics show, after an initial decline in Russian oil exports to China from 1.7mbpd in January to 1.4mbpd in February, volumes began growing again, reaching 1.6mbpd in April and almost 2mbpd in May. In April and May of this year, Russian seaborn oil supplies to China reached their highest levels since March 2020, exceeding 1mbpd, against an average of 0.8mbpd in 2021. Moreover, demand for Russian oil is not limited to China and India, with Indonesia and Sri Lanka both showing an interest as well.

The first dose is free

Several factors support the growth of Russian oil supplies to Asia. The most important one is the unprecedented discounts that Russian producers are offering their customers to compensate for the potential risks and costs of purchasing politically toxic oil. According to various estimates, this discount may be as high as $25-35 per barrel, which attracts profit-minded refiners that have already significantly boosted their margins and countries that are experiencing economic difficulties and cannot afford to purchase oil at the high official price. Russia's partial loss of the petrochemical market may also benefit the oil trade: Russian oil may be in demand as a feedstock in those countries that have tried to replace Russia and increase their exports in the markets for fuel and other petrochemical products. Thirdly, Moscow should be grateful to Tehran, which previously allowed Asian consumers to develop a number of techniques to circumvent sanctions to buy Iranian oil. These same techniques are now being used by Beijing and others to adjust their oil trade with Russia in light of the new realities. At the same time, in terms of the oil volumes available, their quality, and in some cases their greater proximity, Russian hydrocarbons appear be more attractive for Asian consumers than Iranian ones. Finally, Moscow is ready to pay the costs associated with the supply of oil to Asian markets and quickly learns from its mistakes. This extends not only to its willingness to provide discounts, but also to take on both the risks and costs associated with paying for ship insurance, owning its own tanker fleet, using low-tonnage carriers, as well as trading oil "from tanker to tanker." Ultimately, despite all of the associated costs, today's high oil prices allow Moscow to remain in profit.

Winners and losers

However, there are also losers from the current market dynamics, including oil producers in the Gulf. Iran was the first to suffer. Russia challenged its position in the gray market for sanctioned oil. As already noted, Russian hydrocarbons have a number of undeniable advantages for China, including the fact that the restrictions on Russian oil are not as strict as those on Iranian oil. It is difficult to judge Iran's losses, since there is no accurate accounting of how much of its oil bypasses sanctions. However, the Iranians’ pained reaction to the inflow of Russian oil certainly says something about how much income they have lost. Moreover, it is not just about oil but also petrochemical products. For example, Russian liquefied petroleum gas (LPG) has become a significant competitor to Iranian LPG in Turkey, Pakistan, and Afghanistan.

In the Indian market, Russian oil has challenged the positions of other Gulf producers, including the UAE, Saudi Arabia, and especially Iraq. By May 2022, all three countries had lost a substantial volume of supplies to Moscow (see Table 1).
Table 1. Oil exports to India by top producers (Jan-May 2022, mbpd)


Russian oil may also present a threat to Saudi interests in the Chinese market, although so far the volume of Saudi supplies to China has been growing steadily. However, according to some experts, Oman will be the main victim of the influx of Russian Urals oil to China.

All of these factors have forced the Gulf countries to reconsider their pricing policies. Thus, in April, Iraq was the first to cut its oil prices. In May, other Gulf producers followed suit. Interestingly, Russian prices turned out to be more influential than other factors affecting the market, such as the possibility of a gradual easing of quarantine restrictions in China, that in theory should have pushed oil prices upward.

Brave new world

The bad news for the Gulf states is that this situation is becoming the new reality. Even though the situation may have been created artificially, when some countries, for political reasons and contrary to their economic interests, voluntarily refused to purchase Russian oil, its impact is all too real, creating supply shortages in some markets and potential surpluses in others. There have been similar precedents before, but they were more localized in nature, as in the case of Venezuela or Iran, and the conditions were slightly different. In Russia’s case, the restrictions on oil purchases are being used against one of the main players in the market, affecting a significant amount of oil when there is already an existing undersupply. Moreover, this trend is obviously long term. The European desire to avoid dependence on Russian oil is unlikely to change. Russia will also not be able to immediately redirect all of its oil to Asia and find buyers for it, as evidenced by the growing volume of Russian oil reserves accumulating in storage and on tankers. This means that, at least in the medium term, Moscow will have certain reserves of hydrocarbons that it can use to affect the market’s balance. Russian oil will also be a wild card as part of it is now sold secretly, under other names, thus making it difficult to track. There are already rumors about schemes Russia is using to channel its oil exports to third countries through the Gulf states, Asia, and even the EU.

The war unleashed by Vladimir Putin gave rise to a restructuring of oil market flows and created new sources of uncertainty that will last at least until the conflict ends and relations improve. That is not likely to happen soon and the market seems to be beginning to recognize the long-term nature of the current situation. Thus, companies based in East and Southeast Asia, such as Shandong Port International Trade Group or Livna Shipping, are replacing the previous traders of Russian oil that were mainly based in Europe. Gulf producers are no longer silent about their problems and are obviously unhappy that political factors have created a serious imbalance in oil exports flows — a point clearly articulated by UAE Oil Minister Suhail al-Mazroui in early May. Gradually, everyone seems to have come to the same conclusion: Sanctioned Russian oil is becoming a new reality in Asian oil markets and it must be reckoned with. Some players, like Iran, are trying to find a way to co-exist with Russia, hoping to divide the market for "gray" oil. Others, like Saudi Arabia and its partners, can presumably expect to work with Moscow within the framework of OPEC+, although some cartel members are in favor of greater competition with Moscow for oil markets. None of them, however, should doubt that Russia will remain an important player in the oil market, at least for the foreseeable future.


Nikolay Kozhanov is a research associate professor at the Gulf Studies Center of Qatar University and a non-resident scholar with MEI’s Program on Economics and Energy. The opinions expressed in this piece are his own.

Photo by YU FANGPING/ Feature China/Future Publishing via Getty Images

[Solauren]

Pretty fucking stupid to get reliant on gas and idiot renewables that require fossil fuel backups to work more than half of the time. Energiewende could as well have been a russian sting operation to fuck over europe.

No need for that. All you need to do is to funnel money to disinformation and the right activists groups, and they'll do the work for you.