“I am saddened that it is politically inconvenient to acknowledge what everyone
knows: the Iraq war is largely about oil”
Alan Greenspan
War-for-oil, or more precisely, power projection to preserve the petrodollar,
is realpolitik.
Per capita energy usage in the United States is the highest among all nations of the world. The USA
consumes 25% of would energy resources while having only 5% of the population. Approximately half of
the energy used in the US is electrical energy generated by coal-fired power plants. The other
part is oil that is mainly imported.
Securing uninterruptable supply of oil became the key task of the USA foreign policy since president
Carter. The second important goal is maintaining dollar as the world primary reserve currency,
and, especially, the main currency you can buy oil with. That includes maintaining the stability
of client Arab regimes, such as Kuwait and Saudi Arabia.
Oil Wars
Recently the USA waged several "oil wars" (Iraq war, Libya war, Syria war, attempt of "color
revolution" in Russia) with the most brutal being the Iraq war. The two main messages from the war
in Iraq are:
If you repeat a boldfaced lie frequently enough, it will someday become accepted truth.
The bolder is the lie, the better. This is the same idea that was first revealed to the world by
doctor Goebbels.
Saving face is much more important than admitting a mistake, no matter how destructive the outcome.
Manipulating the facts became the norm for the Bush administration, which invaded Iraq on what we
know now (and the administration almost certainly knew then) were utterly false pretenses. Thanks to
these lies, Americans, including our soldiers and civilians serving in Iraq, were killed or injured.
Links to the 9/11 attacks and the claim that Saddam had weapons of mass destruction, two of the ever-evolving
reasons for getting into the war were blatantly false from the very beginning. They were fabricated
to achieve specific goals. Engaging in mass deception in order to justify official policy both
degrades the society, so the war has had a detrimental effect on the USA, as a society. It just has
shown that elites now are audacious enough to throw out even attempt to present their actions as legitimate
of serving national goals. Of course, by far, it is ordinary Iraqis who have suffered the most.
We know now beyond any doubt that Iraq was not involved in 9/11 and had no weapons of mass destruction.
But as Paul Pillar, a former senior CIA analyst with the Iraqi portfolio, wrote on March 14,
“Intelligence did not drive the decision to invade Iraq – not by a long shot, despite the
aggressive use by the Bush administration of cherry-picked fragments of intelligence reporting in
its public sales campaign for the war.”
Indeed, this was a war for oil from the very beginning, and any little lie would have worked.
It is very fortuitous for all those politicians, policy makers, and bureaucrats with Iraqi blood
on their hands — Republicans and Democrats both — that the only courtroom they’ve been shuffled into
is the court of public opinion, where most received light sentences. Bush II actually was reelected
for the second term.
Indeed, the Iraq war boosters are still a fixture on our television screens.
Dan Senor,
who served as a spokesman for the U.S occupation authorities and willfully misrepresented events
on the ground during that time, is a regular commentator on MSNBC’s “Morning Joe,” a veritable roundtable
of Washington establishment punditry.
Kenneth Pollack, a longtime Brookings fellow and CIA analyst who wrote the 2002 book The
Threatening Storm: The Case for Invading Iraq (which is barely mentioned today on the Brookings
website), is a familiar face on the commentary circuit and among think tank salons.
Ex-Generals David Petraeus and Stanley McChrystal, who each left their most recent posts in disgrace,
are raking in thousands of dollars for speeches, lectures, and consulting work.
Sure, there are pundits and reporters who admit they wrongly supported the war, but their regrets
are usually reserved for their blind faith in the war planners and their own lack of inquisitiveness.
For example, Washington Post columnist David Ignatius confessed in a March 21 column that Iraq
was one of “the biggest strategic errors in Modern American history.” But the thrust of his own
mea culpa was that he did not write enough “on the overriding question of whether the war made
sense,” which would have allowed him to see that the U.S was not strong enough nor flexible enough to
succeed.
Rarely do pundits apologize for the horrendous Iraqi losses inflicted by the war: more than a million
deaths and millions more wounded with varying lifelong disabilities, including thousands of tortured
prisoners, with an estimated
16,000 of them still unaccounted for. Twenty-eight percent of Iraqi children suffer from post-traumatic
stress disorder, and 2.8 million people
are still internally displaced or living as
refugees outside the country.
Add to that the complete destruction of the Iraqi infrastructure outside oil sector, as well as its
transportation, education, and medical institutions. Don’t forget the countless people suffering from
trauma and depression, sectarian war with daily killings, terrifying birth defects from toxic pollution,
and a brain drain that has left the country illiterate.
Not since the American Civil War has the U.S citizenry had to endure such horrors. Yet discussion
of these repercussions is noticeably absent as we still struggle to understand the scope of the Iraq
war and what all of its lies have wrought.
Let us start with a sincere apology to the Iraqi people for the crimes the U.S. government has committed.
A long-range plan for restitution is a second step. Empires decline due to moral decay from within.
Ten years after the invasion of Iraq, our nation is looking at the moral abyss. If lies have delivered
us to this place, then only the truth will begin our journey back.
Because it was marked "confidential" on each page, the oil industry stooge couldn't believe the
US State Department had given me a complete copy of their secret plans for the oil fields of Iraq.
Actually, the State Department had done no such thing. But my line of bullshit had been so well-practiced
and the set-up on my mark had so thoroughly established my fake identity, that I almost began to
believe my own lies.
I closed in. I said I wanted to make sure she and I were working from the same State Department
draft. Could she tell me the official name, date and number of pages? She did.
Bingo! I'd just beaten the Military-Petroleum Complex in a lying contest, so I had a right to
be chuffed.
After phoning numbers from California to Kazakhstan to trick my mark, my next calls were to the
State Department and Pentagon. Now that I had the specs on the scheme for Iraq's oil – that State
and Defense Department swore, in writing, did not exist – I told them I'd appreciate their handing
over a copy (no expurgations, please) or there would be a very embarrassing story on BBC Newsnight.
Within days, our chief of investigations, Ms Badpenny, delivered to my shack in the woods outside
New York a 323-page, three-volume programme for Iraq's oil crafted by George Bush's State Department
and petroleum insiders meeting secretly in Houston, Texas.
I cracked open the pile of paper – and I was blown away.
Like most lefty journalists, I assumed that George Bush and Tony Blair invaded Iraq to buy up
its oil fields, cheap and at gun-point, and cart off the oil. We thought we knew the neo-cons true
casus belli: Blood for oil.
But the truth in the Options for Iraqi Oil Industry was worse than "Blood for Oil". Much, much
worse.
The key was in the flow chart on page 15, Iraq Oil Regime Timeline & Scenario Analysis:
"...A single state-owned company ...enhances a government's relationship with OPEC."
Gas wars
EuroMaidan can be considered to be a proxy "gas war" when the USA hides behind Ukraine far right
to fight Russia and EU. See
Well, there is a plan BRICS - or so the BRICS nations would like to think, at least. And when
the BRICS do act in this spirit on the global stage, they quickly conjure up a curious mix of fear,
hysteria, and pugnaciousness in the Washington establishment.
Take Christopher Hill as an example. The former assistant secretary of state for East Asia and
US ambassador to Iraq is now an advisor with the Albright Stonebridge Group, a consulting firm deeply
connected to the White House and the State Department. When Russia was down and out, Hill used to
dream of a hegemonic American "new world order". Now that the ungrateful Russians have spurned what
"the West has been offering" - that is, "special status with NATO, a privileged relationship with
the European Union, and partnership in international diplomatic endeavors" - they are, in his view,
busy trying to revive the Soviet empire. Translation: if you're not our vassals, you're against
us. Welcome to Cold War 2.0.
The Pentagon has its own version of this directed not so much at Russia as at China, which, its
think tank on future warfare claims, is already at war with Washington in a number of ways. So if
it's not apocalypse now, it's Armageddon tomorrow. And it goes without saying that whatever's going
wrong, as the Obama administration very publicly "pivots" to Asia and the American media fills with
talk about a revival of Cold War-era "containment policy" in the Pacific, it's all China's fault.
Embedded in the mad dash toward Cold War 2.0 are some ludicrous facts-on-the-ground: the US government,
with $17.5 trillion in national debt and counting, is contemplating a financial showdown with
Russia, the largest global energy producer and a major nuclear power, just as it's also promoting
an economically unsustainable military encirclement of its largest creditor, China.
Russia runs a sizeable trade surplus. Humongous Chinese banks will have no trouble helping Russian
banks out if Western funds dry up. In terms of inter-BRICS cooperation, few projects beat a $30 billion
oil pipeline in the planning stages that will stretch from Russia to India via Northwest China.
Chinese companies are already eagerly discussing the possibility of taking part in the creation
of a transport corridor from Russia into Crimea, as well as an airport, shipyard, and liquid natural
gas terminal there. And there's another "thermonuclear" gambit in the making: the birth of a
natural gas equivalent to the Organization of the Petroleum Exporting Countries that would include
Russia, Iran, and reportedly disgruntled US ally Qatar.
The (unstated) BRICS long-term plan involves the creation of an alternative economic system featuring
a basket of gold-backed currencies that would bypass the present America-centric global financial
system. (No wonder Russia and China are amassing as much gold as they can.) The euro - a sound currency
backed by large liquid bond markets and huge gold reserves - would be welcomed in as well.
It's no secret in Hong Kong that the Bank of China has been using a parallel SWIFT network to
conduct every kind of trade with Tehran, which is under a heavy US sanctions regime. With Washington
wielding Visa and MasterCard as weapons in a growing Cold War-style economic campaign against Russia,
Moscow is about to implement an alternative payment and credit card system not controlled by Western
finance.
An even easier route would be to adopt the Chinese Union Pay system, whose operations have already
overtaken American Express in global volume.
Why Energy is Central to the Economy
BC, January 22, 2015 at 6:44 pm
Economics is politics. Politics is war by other means. War is the business of empire (hegemony).
War is good business for imperialists.
Therefore, economics is the intellectual and political rationalization for the business objectives
of imperial expansionism, expropriation, and co-optation of client-states’ elites by means of state
violence when necessary, which is more often than not when resources become increasingly scarce and
the hegemonic frontiers of expansionism are threatened.
Yet, most Americans do not yet perceive the US as an empire (successor to the British Empire),
not surprisingly, which would necessarily require the inference that empires peak, decline, and eventually
collapse, and we have been in relative decline since the 1970s-80s, which most of the working-class
bottom 90% would have to concede were they honest with themselves and their fellows. And, no, McConnell,
Romney, Rubio, Paul, et al., care not about the working-class bottom 90% but themselves and those
deep-pocketed Republicans who cut the largest campaign finance checks.
But one suspects that the 80-90% of the population who were slaves during the Greek city-state
dominance and later Roman Empire neither perceived themselves living in the context of imperial decline
and incipient collapse, as their daily life experience was preoccupied with acquiescing to their
imperial masters’ demands and the imperative to survive and thereafter subsist within their circumstances,
if they/we’re luck . . ., or not.
Same as it ever was . . .
Coilin MacLochlainn, January 22, 2015 at 8:19 pm
Malthus was not wrong, he was right. The reason for that is, the Earth is finite and has limited
resources. The human population has reached 7 billion. If it continues to grow, or even if it doesn’t,
it will exceed the ability of the Earth’s remaining land base to support us.
In fact, it already has. Several of the Earth’s planetary limits have already been exceeded and
we are cannibalising what remains of the Earth’s surviving natural resources just to keep going.
What I mean is, we are using up the very resources that we rely on as a species to survive into the
future. And at the same time, we are making it impossible for much of the rest of life on Earth to
survive, which is why so many species are going extinct now and most will be wiped out before we
are done.
For those of us living in the developed world, it is hard to picture this, because we are living
off the exploitation of resources and labour in less well off countries.
There are also glaring examples of excessive exploitation in the developed world. For example,
in California, which leads the world in the production of almonds, walnuts and pistachio nuts, there
is not enough surface water available to supply the industry and so nut farmers are irrigating their
crops using underground water. With the ongoing drought in California, the underground aquifer is
not being recharged, so it won’t be long before the nut farmers run out of water and the industry
goes bust. It will go bust and it will also leave the aquifer dry, with no possibility of refilling
with water while the drought lasts, which could be for years or forever.
Jan Steinman, January 22, 2015 at 6:26 pm
“Capital is embodied energy.”
Are you talking about physical capital, such as factories, machines, and such?
A lot of very smart people seem to think “capital” is little bits of coloured paper, or even invisible
magnetic bits on a spinning disk. But I think that’s where the second half of your essay (debt) comes
into play.
It would be nice to have some simple term-of-art to distinguish between the two forms of “capital.”
I agree that physical plant is capital. It may even be that, pre-Bretton Woods, money was an adequate
symbol for capital. But it seems to me that there is way more money around than there is physical
capital these days.
garand555, January 21, 2015 at 5:24 pm
Economics is a pseudo-science, at least the way it is practiced.
... ... ...
InAlaska, January 21, 2015 at 7:58 pm
Economists endorsed the idea of globalism after it became apparent that without it, national economies
could no longer grow. Globalization is going to kill us because it removes from local control the
basic production of necessities. Speaking of economics, here is part of a post on The Automatic Earth
from yesterday concerning the Davos crowd and the World Economic Forum:
“When it comes to basic necessities, to food, water and shelter, we shouldn’t strive to compete
with other economies. That is not good for us, or for our peers in those other economies; it’s good
only for those who skim off the top. The larger and more globalized the top, the more there is to
skim off. All the ‘reform’ is geared towards making our economies ever more dependent on the global
economy. And that is not in our best interest.
It’s not all just even about money, it’s about our security, and independence. Everybody likes
the idea of being independent, but at the same time few realize that globalization is the exact opposite
of independence. Global trade is fine, as long as it’s limited to things we don’t need to survive,
but it’s not fine if and when it takes away the ability of a community or a society to provide for
itself.
Protectionism has acquired a really bad reputation, as if it’s inherently evil to try and protect
your community from being gutted by economic ideas and systems it has no defense against, or to make
sure it can generate and provide for its own basics at all times. But that’s just propaganda too.
If our societies are not designed and constructed to provide for themselves, they’ll end up with
no choice but to go to war with each other. Along the same lines, if our societies don’t have strict
laws in place that guarantee we can’t and won’t destroy the natural resources of the land we live
on comes with, we’ll also end up going to war with each other.
We’re not going to solve the Gordian knot of the entire global economy and all the hubris and
propaganda the present leading politicians, businessmen and ‘reporters’ bring to the table. And we
probably shouldn’t want to. Our brains did not develop to do things on a global scale. The clowns
will blow themselves up sooner or later. We should focus on what we can do, meanwhile, in our immediate
surroundings.
And it’s pretty easy from there, really. The economic problems we have are mostly artificial.
They have been induced by the broken economic model the Davos crowd, the central bankers and you
know who else would have us believe is the one and only, and that they are busy fixing for our sake
and greater glory. But they care only about their own glory.”
Gail Tverberg, January 22, 2015 at 8:38 pm
On the other hand, without the growth that was obtained from globalization, the financial system
would have collapsed earlier. So in some sense, we are better off, even if it is not sustainable.
The US started hollowing out its manufacturing not too long after the oil problems of the 1970s.
Japan came first in globalization, before the other Eastern countries.
InAlaska, January 21, 2015 at 7:24 pm
Liquid Assets,
Economists run the Federal Reserve Bank and all the central banks in the world.
How has their “straight thinking” worked out? Has the world ever been in such a fiscal mess before?
How have all of those over-educated PhDs in Economics done better than an Actuary could do?
Economics is the dismal “science” in part because it is predicated on the assumption that their
can be infinite inputs into the system. Before you insult Gail and suggest she get a “real education,”
consider that this whole edifice of “Economics” and endless growth is based on and within a finite
world.
escravaisaurabr, January 22, 2015 at 7:33 am
InAlaska,
Two perceptive posts you wrote. Thank you.
I would like to add this post. I think most of you will appreciate. I sure love this post….
By falak pema
Economics is a means to achieve an end, like language.
So linguists are capable of understanding the logic of communication for DECISION MAKING; whether
it be in words and intellectual concepts or in numbers/statistics and algorithms.
The issue here is that perfect markets like perfect speech do not exist for themselves in society,
except for the “initiated”, but have a different function as a VEHICLE for body politic; which defines
the AIMS and uses the means, all the means : of language as of images and of statistics and mathematical
constructs.
So the thesis of the Mises/Hayek type Shamans that Economia is the “be-all” of society is just
wrong. No more than the works of Shakespeare or Hugo, or of Picasso etc.
They do not define politics and power in society. They may influence it but they don’t define
it’s objectives.
Linguists like economists can add substance to a political construct that defines the power play
in civilization. And in that respect markets are just a means and their perfection as important as
a perfect face on the screen.
All imagery or conceptual work in life is virtual.
It becomes real when it faces the real world of power and its continual balancing act; facts and
irreversible acts that define our future as they have our past.
Chomsky is more relevant today to society than Mises.
The first analyses real political acts and consequences the other confines himself to theoretical
pontification about the real economy looked at through the lens which keeps referring to the mantra
of perfect markets.
Not saying markets are not important just saying they are not ALL important.
For the Mises theory to become reality we would have to live in a perfect “anarchy” state without
government. The last time they wanted the state to “shrivel away” it was called the “ultimate step
of communism” and it parented Stalinism. So…you have to know what you wish for in the REAL world.
History says you are wrong. You keep harping about a system that has gone off the cliff twice
because of market forces being spiraled into Vesuvian eruption under irrational exuberance and greed
and thanks to lack of Government regulation : in 1929 and 2008.
You are into DEEP denial of historical FACTS.
The historical thread shows us neo-feudal oligarchs are just as destructive of wealth creation
as are statist hegemonists.
The only realistic solution is to balance state power and private oligarchy power and make sure
NEITHER is in dominant position by having transparent control of public and private spending and
by ensuring due diligence and SANCTIONS.
Today we have a Mussolinian economy of crony collusion between statists and oligarchs. We
have the worst of both worlds.
We need good state governance and non monopolistic private sector innovative investment, compatible
with “general good”, that does not run us off the cliff in mad speculation nor poison the planet.
The GDP should be run on an equitable basis between both power structures.
Whether this divide is 30/70 or 50/50 between private and public and how its used and how its
controlled and monitored is the role of the Republic. And it should be debated and then voted and
then executed in a legal framework which is NOT CORRUPT.
perated by high gasoline prices just ahead of the U.S. midterm elections, lawmakers in
Congress are trying to make it easier for the United States to sue OPEC. And unlike previous
failed efforts to go after the oil-exporting cartel, this time Congress will find a
sympathetic ear in the White House.
The bipartisan No Oil Producing and Exporting Cartels Act, or NOPEC bill, would tweak U.S.
antitrust law to explicitly ban just the kind of collusive behavior that OPEC was created to
engage in. The bill, a carbon copy of previous legislation, makes illegal any activity to
restrain the production of oil or gas or set oil and gas prices and knocks away two legal
defenses that in the past have shielded OPEC from U.S. antitrust measures.
The international lawyers of Wall Street did not hide from each other their shared belief
that they understood better than Washington the requirements for running the world. As John
Foster Dulles wrote in the 1930s to a British colleague,
The word "cartel" has here assumed the stigma of a bogeyman which the politicians are
constantly attacking. The fact of the matter is that most of these politicians are highly
insular and nationalistic and because the political organization of the world has under such
influence been so backward, business people who have had to cope realistically with
international problems have had to find ways for getting through and around stupid political
barriers. 44
This same mentality also explains why Allen Dulles as an OSS officer in 1945 simply evaded
orders from Washington forbidding him to negotiate with SS General Karl Wolff about a
conditional surrender of German forces in Italy – an important breach of Roosevelt's
agreement with Stalin at Yalta for unconditional surrender, a breach that is regarded by many
as helping lead to the Cold War. 45 And it explains why Allen, as CIA Director in
1957, dealt summarily with Eisenhower's reluctance to authorize more than occasional U-2
overflights of the USSR, by secretly approving a plan with Britain's MI-6 whereby U-2 flights
could be authorized instead by the UK Prime Minister Macmillan. 46
This mentality exhibited itself in 1952, when Truman's Justice Department sought to break up
the cartel agreements whereby Standard Oil of New Jersey (now Exxon) and four other oil majors
controlled global oil distribution. (The other four were Standard Oil Company of New York,
Standard Oil of California or Socony, Gulf Oil, and Texaco; together with Royal Dutch Shell and
Anglo-Iranian, they comprised the so-called Seven Sisters of the cartel.) Faced with a
government order to hand over relevant documents, Exxon's lawyer Arthur Dean at Sullivan and
Cromwell, where Foster was senior partner, refused: "If it were not for the question of
national security, we would be perfectly willing to face either a criminal or a civil suit. But
this is the kind of information the Kremlin would love to get its hands on." 47
At this time the oil cartel was working closely with the British Anglo-Iranian Oil Company
(AIOC, later BP) to prevent AIOC's nationalization by Iran's Premier Mossadeq, by instituting,
in May 1951, a successful boycott of Iranian oil exports.
In May 1951 the AIOC secured the backing of the other oil majors, who had every interest
in discouraging nationalisation.... None of the large companies would touch Iranian oil;
despite one or two picturesque episodes the boycott held. 48
As a result Iranian oil production fell from 241 million barrels in 1950 to 10.6 million
barrels in 1952.
This was accomplished by denying Iran the ability to export its crude oil. At that time,
the Seven Sisters controlled almost 99% of the crude oil tankers in the world for such
export, and even more importantly, the markets to which it was going. 49
But Truman declined, despite a direct personal appeal from Churchill, to have the CIA
participate in efforts to overthrow Mossadeq, and instead dispatched Averell Harriman to Tehran
in a failed effort to negotiate a peaceful resolution of Mossadeq's differences with London.
50
All this changed with the election of Eisenhower in November 1952, followed by the
appointment of the Dulles brothers to be Secretary of State and head of CIA. The Justice
Department's criminal complaint against the oil cartel was swiftly replaced by a civil suit,
from which the oil cartel eventually emerged unscathed. 51
Eisenhower, an open friend of the oil industry changed the charges from criminal to civil
and transferred responsibility of the case from the Department of Justice to the Department
of State – the first time in history that an antitrust case was handed to State for
prosecution. Seeing as how the Secretary of State was John Foster Dulles and the defense
counsel for the oil cartel was Dulles' former law firm (Sullivan and Cromwell), the case was
soon as good as dead. 52
Thereafter
Cooperative control of the world market by the major oil companies remained in effect,
with varying degrees of success, until the oil embargo of 1973-74. That the cooperation was
more than tacit can be seen by the fact that antitrust regulations were specifically set
aside a number of times during the 1950-1973 period, allowing the major companies to
negotiate as a group with various Mideastern countries, and after its inception [in 1960],
with the Organization of Petroleum Exporting Countries or OPEC. 53
Also in November 1952 CIA officials began planning to involve CIA in the efforts of MI6 and
the oil companies in Iran 54 -- although its notorious Operation TP/AJAX to
overthrow Mossadeq was not finally approved by Eisenhower until July 22, 1953.
55
The events of 1953 strengthened the role of the oil cartel as a structural component of the
American deep state, drawing on its powerful connections to both Wall Street and the CIA.
56 (Another such component was the Arabian-American Oil Company or ARAMCO in Saudi
Arabia, which increased oil production in 1951-53 to offset the loss of oil from Iran. Until it
was fully nationalized in 1980, ARAMCO maintained undercover CIA personnel like William Eddy
among its top advisors.) 57 The five American oil majors in particular were also
strengthened by the success of AJAX, as Anglo-Iranian (renamed BP) was henceforth forced to
share 40 percent of the oil from its Iran refinery with them.
Nearly all recent accounts of Mossadeq's overthrow treat it as a covert intelligence
operation, with the oil cartel (when mentioned at all) playing a subservient role. However the
chronology, and above all the belated approval from Eisenhower, suggest that it was CIA that
came belatedly in 1953 to assist an earlier oil cartel operation, rather than vice versa. In
terms of the deep state, the oil cartel or deep state initiated in 1951 a process that the
American public state only authorized two years later. Yet the inevitable bias in academic or
archival historiography, working only with those primary sources that are publicly available,
is to think of the Mossadeq tragedy as simply a "CIA coup."
VK
I posted the sequence of events used to create the petro dollar back in the 2018-33
thread.
Will post them again here as this thread concerns Kissinger.
More specifics can be added to this planned sequence of events, this just the basics.
...........
In the late 1960s, US found oil at Prudhoe bay and by 1970 it was a proved crude oil
reserve.
Due to environmental and other legal challenges, construction of the pipeline was held up.
In late 1972 the US Secretary of the Interior declares the trans-Alaska pipeline to be in
the US national interest
1973-74. OPEC oil embargo due to US backing of Israel pushes oil prices up in an initial
rise.
1973 (OPEC oil embargo) The Trans-Alaska pipeline Authorization Act legislation is quickly
pushed through. Signed by Nixon on November 16 1973. This blocked all further challenges
allowing construction to begin. pdf
Late 1973 Nixon along with Saudi Arabia create the petro dollar beginning in 1974.
1979-80 the price of oil skyrockets due to the Iranian revolution. The US is now the
global economic hegemon as all countries now need US dollars to purchase oil.
I have read that Kissinger withheld information from both Nixon and Israel, but have not
followed that line of research.
Here is a piece from an official Kissinger biography. You can see here he was working both
sides.
https://history.state.gov/departmenthistory/people/kissinger-henry-a
Kissinger entered the State Department just two weeks before Egypt and Syria launched a
surprise attack on Israel. The October War of 1973 played a major role in shaping Kissinger's
tenure as Secretary. First, he worked to ensure Israel received an airlift of U.S. military
supplies. This airlift helped Israel turn the war in Israel's favor, and it also led members
of the Organization of Petroleum Exporting Countries (OPEC) to initiate an oil embargo
against the United States. After the implementation of a United Nation's sponsored ceasefire,
Kissinger began a series of "shuttle diplomacy" missions, in which he traveled between
various Middle East capitals to reach disengagement agreements between the enemy combatants.
These efforts produced an agreement in January 1974 between Egypt and Israel and in May 1974
between Syria and Israel. Additionally, Kissinger's efforts contributed to OPEC's decision to
lift the embargo.
It is noticeable that Trump's US attack any Syrian forces coming too close to US occupied
zones of al Tanf and Dier Ezzor. Also Trumps takeover of the Deir Ezzor oilfields where US
forces simply set up bases or forward posts in the ISIS occupied area.
Under Trump, US has set up a number of new bases in Syria. On the other hand, no concern
about Afrin and Manbij. The Deir Ezzor area is Arab tribes and this and al Hasakah
(Kurd/Arab?) is the top end of the Persian Gulf/Mesopotamia oil field.
US now controls al Hasakah and half of Deir Ezzor province. The have been ongoing efforts
by the US under Trump to take Al Bukamal. US has a base just south of Al Bukamal in Iraq. US
bases are now thick throughout Mesopotamia, with more being built.
Also a new base being installed in Kuwait.
The US controls the Arab shore of the Persian gulf, it now has many bases in Iraq and
Syria. The only thing missing is the oil rich strip of Iran running alongside the Persian
gulf and Mesopotamia.
"... How different is it really from the past 70+ years (since that 45' meeting between FDR and the then ruler of KSA), and especially since the "oil shocks" of the 1970's ? The Trumpians are little more direct and crude in their wording, but that is really the only difference I see. ..."
"... Putin's announcement after Turkey's shooting down of a Russian jet that Turkey has been systematically facilitating ISIS oil sales illustrates how the terror-entity has become a figleaf to justify military action. ..."
"... As INSURGEintelligence has previously reported, there is significant evidence that high-level elements of Turkish government and intelligence agencies have covertly sponsored Islamist terrorist groups in Syria, including ISIS, and that this has involved permitting black market oil sales. ..."
"... Why, however, did Vladimir Putin wait until the murder of a Russian pilot before announcing Russia's possession of intelligence on Turkish state-sponsorship of ISIS? ..."
"... There can be little doubt that Putin had previously been more interested in protecting Russian relations with Turkey as an emerging gas transshipment hub to Europe, under which he and Erdogan planned to build the multibillion Russia-Turkey gas pipeline, Turkish Stream -- now suspended after the recent diplomatic furore. ..."
"... It has become increasingly clear that the US-led coalition strategy is aimed primarily at containment of the group's territorial ambitions within Syria. ..."
"... In this context, as Russia and Iran consolidate their hold on Syria through the Assad regime -- staking the claim to Syria's untapped resources in the Mediterranean -- the acceleration of Western military action offers both a carrot and a stick: the carrot aims to threaten the Assad regime into a political accommodation that capitulates to Western regional energy designs; the stick aims to replace him with a more compliant entity comprised of rebel forces backed by Western allies, the Gulf states and Turkey, whilst containing the most virulent faction, ISIS. ..."
The Saudi's. Interesting watching them agree to whatever Trump wants. The most recent one was Trump telling them to raise oil
output. The Saudi's now are very pro zionist and will back them against the Sunni Palestinians no matter what. If Trumps tells
them to pay for a US war or occupation they pay. If they are told to by lots of useless junk from the US MIC, they buy it and
manage to pull a twisted smile when Trump turns the screws about billions being peanuts.
Seems very much like KSA is now an expendable asset for the US, and their only chance of survival is a lot of 'yes sir, how
high sir'.
How different is it really from the past 70+ years (since that 45' meeting between FDR and the then ruler of KSA), and
especially since the "oil shocks" of the 1970's ? The Trumpians are little more direct and crude in their wording, but that is
really the only difference I see.
Posted by: Peter L. | Jul 1, 2018 11:21:17 PM | 23
Look no further than the first sentence of the text you quote. It has been documented a few times, including in the Intercept,
that there were some very serious money flows towards a certain foundation run by the family of the named person. Money flows
that originated in the Gulf. Money flows that were related to what happened in Libia.
Putin's announcement after Turkey's shooting down of a Russian jet that Turkey has been systematically facilitating ISIS
oil sales illustrates how the terror-entity has become a figleaf to justify military action.
As INSURGEintelligence has previously reported, there is significant evidence that high-level elements of Turkish government
and intelligence agencies have covertly sponsored Islamist terrorist groups in Syria, including ISIS, and that this has involved
permitting black market oil sales.
Why, however, did Vladimir Putin wait until the murder of a Russian pilot before announcing Russia's possession of intelligence
on Turkish state-sponsorship of ISIS?
There can be little doubt that Putin had previously been more interested in protecting Russian relations with Turkey
as an emerging gas transshipment hub to Europe, under which he and Erdogan planned to build the multibillion Russia-Turkey
gas pipeline, Turkish Stream -- now suspended after the recent diplomatic furore.
US, British and French military operations have been similarly inconsistent, inexplicably failing to shut down ISIS supply
lines through Turkey, failing to bomb critical ISIS oil infrastructure including vast convoys of trucks transporting black
market oil, and refusing to arm the most effective and secular Kurdish ground forces combating ISIS.
It has become increasingly clear that the US-led coalition strategy is aimed primarily at containment of the group's
territorial ambitions within Syria.
....
As Russia expands its military presence in the region in the name of fighting ISIS, the US, Britain and France are now scrambling
to ensure they retain a military foothold in Syria -- an effort to position themselves to make the most of a post-conflict
environment. As the US Geological Survey Minerals Yearbook put it:
"Most of the international investors who pulled out of Syria following the deterioration of the safety and security situation
throughout the country are expected to remain so until the military and political conflicts are resolved."
In this context, as Russia and Iran consolidate their hold on Syria through the Assad regime -- staking the claim
to Syria's untapped resources in the Mediterranean -- the acceleration of Western military action offers both a carrot and
a stick: the carrot aims to threaten the Assad regime into a political accommodation that capitulates to Western regional energy
designs; the stick aims to replace him with a more compliant entity comprised of rebel forces backed by Western allies, the
Gulf states and Turkey, whilst containing the most virulent faction, ISIS.
Hysteria is at fever pitch. After the NATO summit in Brussels, the definitive Decline of the West has been
declared a done deal as President Trump gets ready to meet President Putin in Helsinki.
It was Trump himself who
stipulated that he wants to talk to Putin behind closed doors, face-to-face, without any aides and, in theory,
spontaneously, after the preparatory meeting between Secretary of State Mike Pompeo and Russian Foreign Minister
Sergey Lavrov was canceled. The summit will take place at the early 19
th
century Presidential Palace in
Helsinki, a former residence of Russian emperors.
As a preamble to Helsinki, Trump's spectacular NATO blitzkrieg was a show for the ages; assorted "leaders" in
Brussels simply didn't know what hit them. Trump didn't even bother to arrive on time for morning sessions dealing
with the possible accession of Ukraine and Georgia. Diplomats confirmed to Asia Times that after Trump's stinging
"pay up or else" tirade, Ukraine and Georgia were asked to leave the room because what would be discussed was
strictly an internal NATO issue.
Previewing the summit, Eurocrats indulged in interminable carping about "illiberalism" taking over, from Viktor
Orban in Hungary to Sultan Erdogan in Turkey, as well as mourning the "destruction of European unity" (yes, it's
always Putin's fault). Trump though would have none of it. The US President conflates the EU with NATO,
interpreting the EU as a rival, just like China, but much weaker. As for the US "deal" with NATO, just like NAFTA,
that's a bad deal.
NATO is 'obsolete'
Trump is correct that without the US, NATO is "obsolete" – as in non-existent. So essentially what he did in
Brussels laid bare the case for NATO as a protection racket, with Washington fully entitled to up the stakes for
the "protection".
But "protection" against what?
Since the dismemberment of Yugoslavia, when NATO was repositioned in its new role as humanitarian imperialist
global Robocop, the alliance's record is absolutely dismal.
That features miserably losing an endless war in Afghanistan against a bunch of Pashtun warriors armed with
Kalashnikov replicas; turning functional Libya into a militia wasteland and headquarters for Europe-bound
refugees; and having the NATO-Gulf Cooperation Council lose its bet on a galaxy of jihadis and crypto-jihadis in
Syria spun as "moderate rebels".
NATO has launched a new training, non-combat mission in Iraq; 15 years after Shock and Awe, Sunnis, Shi'ites,
Yazidis and even Kurdish factions are not impressed.
Then there's the NATO Readiness Initiative; the capacity of deploying 30 battalions, 30 battleships and 30
aircraft squadrons within 30 days (or less) by 2020. If not to wreak selected havoc across the Global South, this
initiative is supposedly set up to deter "Russian aggression".
So after dabbling with the Global War on Terror, NATO is essentially back to the original "threat"; the
imminent Russian invasion of Western Europe – a ludicrous notion if there ever was one. The
final
statement
in Brussels spells it out, with special emphasis on item 6 and item 7.
The combined GDP of all NATO members is 12 times that of Russia. And NATO's defense spending is six times
larger than Russia's. Contrary to non-stop Polish and Baltic hysteria, Russia does not need to "invade" anything;
what worries the Kremlin, in the long term, is the well being of ethnic Russians living in former Soviet
republics.
Russia can't be both threat and an energy partner
Then there's Europe's energy policy – and that's a completely different story.
Trump has described the Nord Stream 2 pipeline as "inappropriate", but his claim that Germany gets 70% of its
energy (via natural gas imports) from Russia may be easily debunked. Germany gets at best 9% of its energy from
Russia. In terms of Germany's
sources
of energy
, only 20% is natural gas. And less than 40% of natural gas in Germany comes from Russia. Germany is
fast transitioning towards wind, solar, biomass and hydro energy, which made up 41% of the total in 2018. And the
target is 50% by 2030.
Yet Trump does have a sterling point when, stressing that "Germany is a rich country", he wants to know
why America should
"protect
you against Russia"
when energy deals are on the table. "Explain that! It can't be explained!" as he
reportedly said to Nato Secretary-general Jens Stoltenberg on Wednesday.
In the end, of course, it's all about business. What Trump is really aiming at is for Germany to import US
shale gas, three times more expensive than pipeline-delivered Russian gas.
The energy angle is directly linked to the never-ending 2% defense spending soap opera. Germany currently
spends 1.2% of GDP on NATO. by 2024, it's supposed to reach at best 1.5%. And that's it. The majority of German
voters, in fact, want US troops
out
.
So Trump's demand for 4% of GDP on defense spending for all NATO members will never fly. The sales pitch should
be seen for what it is: a tentative "invitation" for an increased EU and NATO shopping spree on US military
hardware.
In a nutshell, the key factor remains that Trump's Brussels blitzkrieg did make his case. Russia cannot be a
"threat" and a reliable energy partner at the same time. As much as NATO poodles may be terrified of "Russian
aggression", the facts spell out they won't put their money where their rhetorical hysteria is.
Foreign ministers attend a working dinner during the NATO Summit in Brussels on July 11, 2018. They gathered to
discuss Russia, Iraq and their mission in Afghanistan. Photo: AFP/ pool/ Yves Herman
Are you listening now?
"Russian aggression" should be one of the top items discussed in Helsinki. In the – remote – possibility that
Trump will strike a deal with Putin, NATO's absurd
raison d'etre
would be even more exposed.
That's not the US "deep-state" agenda, of course, thus the 24/7 demonization of the summit even before it
happens. Moreover, for Trump, the transactional gambling man's Make-America-Great-Again point of view, the ideal
outcome would always be to get even more European weapons deals for the US industrial-military-intelligence
complex.
Terrified by Trump, diplomats in Brussels over these past few days have conveyed to Asia Times fears about the
end of NATO, the end of the World Trade Organization, even the end of the EU. But the fact remains that Europe is
absolutely peripheral to the Big Picture.
In
Losing Military Supremacy
, his latest, groundbreaking book, crack Russian military-naval analyst
Andrei
Martyanov
deconstructs in detail how, "the United States faces two nuclear and industrial superpowers, one of
which fields a world-class armed forces. If the military-political, as opposed to merely economic, alliance
between Russia and China is ever formalized – this will spell the final doom for the United States as a global
power."
The US deep state (its influential bureaucrats) may be wallowing in perpetual denial, but Trump – after many a
closed-door meeting with Henry Kissinger – may have understood the suicidal "strategy" of Washington
simultaneously antagonizing Russia and China.
Putin's landmark
March
1 speech
, as Martyanov stresses, was an effort to "coerce America's elites, if not into peace, at least into
some form of sanity, given that they are currently completely detached from the geopolitical, military and
economic realities of the newly emerging power configurations of the world". These elites may not be listening,
but Trump seems to indicate he is.
As for the NATO poodles, all they can do is watch.
Putin/Russia is also the only entity that can prevent Trump's US from simply walking in and
taking over the rich energy hub (Mafia style) to the south of Eurasia.
Notable quotes:
"... Global Energy Dominance is now part of the US National security Strategy. Although not labeled as global, when reading through the energy dominance section of the NSS, it can clearly been seen to be global. This is not just about sell oil produced in the US. ..."
"... Trump is going for the Achilles heel of Eurasia - energy. Rather than a creative accounting scam that simply racks up huge amounts of debt, Trump is looking for a monopoly or near monopoly business to take over and rake in the profits. ..."
"... Russia supply energy to Eurasia from the North. The opening for the Trump mob is in the south. The meet with Putin may well be to sound out the possibilities of forming a cartel. ..."
"... Yes, it absolutely is. But this is not a new "Trump policy." Certainly Zbiginew Brzezenski laid this out quite clearly in his 1997 book, "The Grand Chessboard: American Primacy and Its Geostrategic Imperatives." It's really all in there, just as you're now identifying. If you can't take the time to read it, please consider at least reading some book reviews. As I've noted before, Ziggy apparently didn't foresee Putin rising to power and restoring the Russian state, which threw the proverbial monkey wrench into the globalists' plans, but really, US foreign policy has continued to follow his plans otherwise. ..."
The latest article at the Saker site by Rostislav Ishchenko - Trump's Geopolitical Cruise
- I think is the best take on Trump's and his backers mindset. Worth a read and covers what I
think was the cause of the split in the US elite.
The petro dollar, kicking off in the late 70s was a piece of creative accounting to give
unlimited credit. This should have been ended with the collapse of the Soviet Union, but
greed got the better of most. Trump and the people backing him could see that this was now in
its terminal stages and US close to collapse itself.
Rostislav Ishchenko, like many thinks that Trump is pulling the US back to a form of
isolation from the world, but I don't think this is the case.
Global Energy Dominance is now part of the US National security Strategy. Although not
labeled as global, when reading through the energy dominance section of the NSS, it can
clearly been seen to be global. This is not just about sell oil produced in the US.
Trump is going for the Achilles heel of Eurasia - energy. Rather than a creative accounting scam that simply racks up huge amounts of debt, Trump is
looking for a monopoly or near monopoly business to take over and rake in the profits.
Russia supply energy to Eurasia from the North. The opening for the Trump mob is in the
south. The meet with Putin may well be to sound out the possibilities of forming a cartel.
Putin/Russia is also the only entity that can prevent Trump's US from simply walking in
and taking over the rich energy hub (Mafia style) to the south of Eurasia.
"Global Energy Dominance is now part of the US National security Strategy."
Yes, it absolutely is. But this is not a new "Trump policy." Certainly Zbiginew Brzezenski
laid this out quite clearly in his 1997 book, "The Grand Chessboard: American Primacy and Its
Geostrategic Imperatives." It's really all in there, just as you're now identifying. If you
can't take the time to read it, please consider at least reading some book reviews. As I've
noted before, Ziggy apparently didn't foresee Putin rising to power and restoring the Russian
state, which threw the proverbial monkey wrench into the globalists' plans, but really, US
foreign policy has continued to follow his plans otherwise.
Kissinger has written much the same, though I don't recall in which books/articles. This
page from the US Navy seems a fine reading list, designed as it appears to indoctrinate
officers in AZ Empire geopolitics.
IMO, the US took the lead in the Empire's Global Energy Dominance quest when FDR met with
King Saud on Great Bitter Lake in the Suez Canal in 1945 (swinging by after the final
post-war world planning meeting with Churchill and Stalin at Yalta). This was when the US
largely replaced Great Britain in primacy over Asian/Middle Eastern energy dominance.
The US is in the Persian Gulf to stay. Trumps face face meet with Putin will be so Trump
can try and gauge what Putin will do - if he will run any blocking moves, his reaction to a
fait accompli ect. Most likely a few more face to face meetings before any move on Iran.
Peter, thanks for pointing out the new and unwanted US base in Iraq. I just read that the US
was building the world's largest Embassy Compound in "Iraqi Kurdistan." I wonder it they're
the same thing?
In a quick web search, failing to find an answer, I noticed that besides the "Green Zone"
compound we built in Baghdad at the start of the current military occupation, the record
holder was the US Embassy Compound in Pakistan.
James and I have discoursed here a bit on the history of US military occupations since WW
II. Boils down to the US has never removed its military from any country it's occupied with
the exception of Vietnam.
veritas semper vincit @103 linked blogpost notes that the US has 40,000 troops still
occupying Germany. His (I presume) post is quite entertaining considering the severe
seriousness of the topic.
Dis is a nice little country ya gotz heyah. Id be a shame if sumpin' bad was ta happen to
it.
MOSCOW (Reuters) - Russian Energy Minister Alexander Novak said on Friday that a deal under which
Russia would provide goods to Iran in exchange for oil is still possible.
Russia is studying all legal issues related to the possible deal, he said.
Looks like OPEC 14 peaked two years. Can they beat it?, perhaps by a small amount in a world
without chaos.
Today orange fatty called out Germany for being captive to Russia. I'm pretty sure he was
referring to German dependence on imported fossil energy from Russia.
As of 2015 Germany net energy imports are 64% of total [USA 12% for comparison]. If this
means 'captive', then perhaps we should acknowledge that 11 of our top 13 trading partners
are highly dependent on imported energy from either Russia or the big OPEC producers.
'Captives' so to speak. Better get used to that idea, and learn how to get along with
others. Only Canada and Mexico aren't 'captives', but we don't look to good at being friends
with them either.
"... Trump seems to enjoy antagonizing the Europeans one way or the other. As to NATO, Trump made the same complaints during his campaign while calling it "obsolete." Sometimes it sounds like he would rather have the US out of NATO. One theory I have is that he is limited in what he can do so he works around TPTBs to get closer to his goals. So he antagonizes and threatens Europe on NATO. The same goes for Syria. He talked about wanting to pull out but kept being drawn back in by the usual suspects. So he's pulled monetary support in certain cases and refused to dig the US in any deeper than it is. And it will be interesting to see what happens with his upcoming meeting with Putin considering how much he had to backtrack on his talk of better relations during his campaign. Those who've wanted him to join the "hate Russia" team may get frustrated. ..."
"... Within this new "mulit-polar" world, only Russia is cutting its military budge. And they still seem to have at least one of the most effective conventional war-fighting capability, and their next generation nuclear deterrence looks nothing short of awesome. They have pipelines to build, and like China, long-term economic contracts to sign. ..."
"... I'm no fan of Angela, but she/Germany have been trying to tamp down this AZ Empire New Cold War against Russia since at least 2013. When she, Putin, Yanukovych (elected President of Ukraine) and the leaders of the Maidan protests got together and signed an agreement in which Yanukovych acquiesced to essentially all of the "peaceful, pro-democracy protesters'" demands, it was the Asst. Secretary of the US State (Vickie Nuland) who said, "F*ck the EU" "We can midwife this thing" and even appointed the new PM "Yats is the guy." ..."
"... The US can't keep funding your crappy little joke of a disintegrating "European Union" for ever. Sooner or later you'll have to put on big-boy pants. ..."
"... USA govt's assessment of China and Russia as "revisionist" should be understood as a determination to remain the hegemonic power. Thus, we have Cold War II. From that perspective, European objections to more "defense" spending are considered naive (or worse) as Europe's fate is views as tied to that of the Empire. ..."
"... I think European elites are much more likely to side with USA than European people. If the Trump's talk with Putin doesn't go well, we are likely to see increased scaremongering to rectify public opinion. ..."
"... Chaos can make doing business harder, but that can also increase profits. As the posters said in the '60s, "War Is Not Good For Children And Other Living Things." But it's great for the psychopaths. ..."
"... Here is an article that explains the relationship between Russian pipelines, USA sanctions on Russia, MH17, Crimea, and Syria. It is an excellent background to comprehend Trump's accusations about Germany's purchase of gas from Russia. Patrick Armstrong and Pat Lang seem to think that Trump is about to cut NATO support, reduce/eliminate sanctions against Russia, and redirect relations with Israel, but I am not persuaded. https://www.unz.com/article/why-was-malaysian-airlines-flight-mh17-shot-down/ by Kees van der Pijl He also wrote a book on this topic. ..."
"... Everything the US does works to undermine its old power in the new world. We see this continually. Trump is an accelerator. But whether any of this is intentional and actually desired by a part of US vested interests, is still an open question. ..."
"... Nevertheless, as we watch, we see every action of the US working to cement the bonds of its opposition in the rest of the world. From the Escobar article linked by karlof1 above, we see the pressure on the Middle East to reject the US and turn for safety to the Eurasian institutions of commerce, finance and national security. The same thing is happening to Europe. ..."
"... he equation as it stands now is this: A muscle-bound USA + an anaemic Europe "deterring" a Russian Federation that has no intention of invading. ..."
"... Since Russia is no threat either way then there is no need - none whatsoever - for the Europeans to increase their military expenditure to "defend themselves" against a non-existent Russian threat. ..."
"... Indeed, the only reason the Europeans would feel that they might have to prepare to "defend themselves" would be because that muscle-bound US military is now outside the tent pissing in, not inside the tent pissing out. ..."
"... Since whenever, America has been the proxy front for the current instantiation of empire with the core of control being ongoing private finance with global tools like BIS, IMF, World Bank, etc. Since WWII and even before the goal of empire is to have all of the world under its control. Since the engine of empire is a supra-national matrix of private finance control, the enemy becomes any nations who do not want to be impregnated with the Western model of private Central Bank, an oligarchy , inheritance, private property, etc. ..."
"... The empire model of growth through wars and boom/bust expansion has reached its "logical" limits and the the existential question has become, blow everything all up or agree to a multipolar world. I think that the elite hope Trump's bluster will make it so they do not have to answer that existential question.....yet ..."
"... If Trump's fake argument gambit was intended to inspire people inside and outside the EU to think outside the box then it seems to have worked. ..."
"... I LUV how Trump stomped on all those preaning European elite scumbags. ..."
"... Agree with Patrick. It is surprising to still see so much animosity towards a president who has done more to combat the absurdity of NATO and globalism than I can remember any other President doing. The ball is in the EU elites court, now. Put up or shut up and I believe it makes no difference to Trump. We are about to find out who is REALLY to blame for marching lockstep with the current of hypercentralization (globalism): the Trump admin or the EU elitez. ..."
"... The US has been manipulating NATO ever since it was formed. Most NATO officials are vetted by the US. Trump is an idiot, like the bulk of US politicians. ..."
"... Trump's "reasoning" makes sense in an infantile sort of way, but there's more too it than meets the eye, is there not? Trump doesn't just want to Europe to "pay their fair share" for NATO, which we all know is code for buying more US mil.gear but also to buy their LNG from US too. It's like NATO is some sort of grotesque, evil franchise where the franchisees can only buy goods/services from that single source, even though it's crap & inordinately expensive, and even if you can get it cheaper elsewhere, i.e Russia. ..."
"... Wow! You don't feel that Trump has, by his mere existence and by winning the presidency, been given a platform of which to decry the myriad injustices of globalization and to utter things unspeakable by any Prez in the last fifty years? ..."
"... Europe has an arms industry of their own. I doubt European countries invest their money into US stuff - they buy their own. Most of the money does not go into weapons anyway, but personel and administration. Germany contributes to the maintenance and infrastructure of US bases, but those bases are business, too. This is not Saudi Arabia buying protection. The real news is that Trump has started a trade war negotiating by tantrum. ..."
You are agreeing with an idiot, no matter what...Europe has nothing to worry about with
regards to Russia. Unless they threaten Russia. 'Love this exchange at breakfast;
"Stoltenberg: [ ] I think that two World Wars and the Cold War taught us that we
are stronger together than apart.
Trump: But how can you be together when a country is getting its energy from the
person you want protection against or from the group that you want protection?
Stoltenberg: Because we understand that when we stand together, also in dealing
with Russia, we are stronger. I think what we have seen is that --
Trump: No, you're just making Russia richer. You're not dealing with Russia.
You're making Russia richer."
You'd have to be an idiot not to agree with Trump here.
Trump seems to enjoy antagonizing the Europeans one way or the other. As to NATO, Trump
made the same complaints during his campaign while calling it "obsolete." Sometimes it sounds
like he would rather have the US out of NATO. One theory I have is that he is limited in what
he can do so he works around TPTBs to get closer to his goals. So he antagonizes and
threatens Europe on NATO. The same goes for Syria. He talked about wanting to pull out but
kept being drawn back in by the usual suspects. So he's pulled monetary support in certain
cases and refused to dig the US in any deeper than it is. And it will be interesting to see
what happens with his upcoming meeting with Putin considering how much he had to backtrack on
his talk of better relations during his campaign. Those who've wanted him to join the "hate
Russia" team may get frustrated.
Will he take direct action on any of these things? I doubt it. The indirect route seems to
go in the right direction.
karlof!. Good to "see" you back. The following is specifically to you, but it does continue
from your first comment. [I couldn't get some links to embed, sorry]
My best short term hope is that all this war-blustering is just to convince we commoners
to bend over so the military/industrial contractors can make lots of gelt. The Global War OF
Terror has been terrific for their bank accounts, but with SAA and the MoD of the RF beating
the snot out of terrorists wherever they go to such an extent that the Pentagon is
considering ISIS essentially defeated.
Besides, the really "big ticket products" are things like aircraft carriers,
"upgraded" nuclear weapons, 5th Generation fighters, etc. etc. etc., that are harder to
excuse when their targets are guys in sandals with AK47s and IEDs. That could be why the 2018
National Defense Strategy plan has shifted from fighting "terrorism" back to " the long-term,
strategic competition between nations."
https://www.defense.gov/Portals/1/Documents/pubs/2018-National-Defense-Strategy-Summary.pdf
Same with our "adversary" across the big pond in China. Just the other day, the CPC warned
of "China's army infiltrated by 'peace disease' requiring a major new "defense posture" just
like the US and NATO.
Within this new "mulit-polar" world, only Russia is cutting its military budge. And
they still seem to have at least one of the most effective conventional war-fighting
capability, and their next generation nuclear deterrence looks nothing short of awesome. They
have pipelines to build, and like China, long-term economic contracts to sign.
No dear b, for once I think you've got it wrong. I see Trump asking three question for all of
which there is one answer.
1. Angela. You tell us that NATO ought to concentrate on the Russian threat. If Russia is a
threat, why are you buying gas from it?
2. Angela, You tell us that Russia is a reliable energy supplier. If Russia is a reliable
supplier, why are you telling us it's a threat?
3. Angela. I hope you're not saying Russia is a threat and its gas is cheap but the USA will
save us.
The answer to all 3 questions is: we're out of here, defend yourselves. It's Trump cutting
the Gordian Knot of obligations.
Aarrgghh! Besides some continuity problems when I recut and pasted the above since the links
weren't working, I also left out the following completely.
That could be why, even though the US 2018 Nuclear Posture Review observes we are changing
from: "For decades, the United States led the world in efforts to reduce the role and number
of nuclear weapons." To " the current, pragmatic assessment of the threats we face and the
uncertainties regarding the future security environment." Which conveniently can use up, or
more likely go over budget on former President CareBear's additional $10 Billion in nuclear
weapons development over the succeeding 10 years.
I'm no fan of Angela, but she/Germany have been trying to tamp down this AZ Empire New
Cold War against Russia since at least 2013. When she, Putin, Yanukovych (elected President
of Ukraine) and the leaders of the Maidan protests got together and signed an agreement in
which Yanukovych acquiesced to essentially all of the "peaceful, pro-democracy protesters'"
demands, it was the Asst. Secretary of the US State (Vickie Nuland) who said, "F*ck the EU"
"We can midwife this thing" and even appointed the new PM "Yats is the guy."
She was then an active participant in the Minsk Agreement to end the "anti-terrorism
action" Which our gal Vickie shredded publicly the next day because the AZ Empire thought the
Uki-Nazis would finish off those Muscovite, Colorado hicks and (can I post the Ukie terms for
Jews?) in the east like they'd done in the south.
Then, Angela was involved in the Minsk II cease-fire/road to peace (when the Uki-Nazis
were being driven out of the east, and were about to lose Mariupol).
I know there are others in addition to b here who know this stuff better than I. Isn't
this about right?
"It is extremely hypocritical for Poland to lobby against Nord Stream when it significantly
contributes to Poland's energy security."
There are other explanations that could be better documented, like stupidity and insanity.
BTW, Poland has big pollution problem, and a major part is that many older multifamily
buildings and new single family building has polluting heating with coal furnaces and stoves.
Natural gas does not generate pollutants except for CO2 which is not affecting health, plus
it uses less than half of carbon than coal.
On the other note, merely to get enough gas for internal needs, Poland could get enough
through Belorus. But if you need to add re-export to Ukraine, that is not enough. So Poles
can pride themselves of not being as stupid and insane as their southeastern neighbors.
Well stated. There are many gordian knots. The BIS should be dissolved
""Responsible fiscal practice requires a government to fill spending gaps left by
fluctuations in non-government spending patterns. In that way, the government takes
responsibility for maintaining full employment. What the Troika did in Greece was the
exemplar of irresponsible fiscal practice.""
I really really like the way you include a 'solution' to a global problem in this analysis b.
To many times we just speak to the choir and rarely are solutions presented regardless where
they lie on the possible/probable line. Did I mention I really like this SA. Thanks.
karlof1 @7. In graph 1, of actual dollar expenditure, NATO spending was going down until
2012, then it started to rise again, and has been a net increase every year since 2015.
In graph 4, per nation spending relative to GDP went up from 2014 to 2017 in almost all
member states notably, except the US and UK, but even then, US went from 3.58% to slightly
over 3.5% and UK from 2.14% to a touch over 2.1%, so both are above the 2% "minimum."
Graphs 5, 6, 7 all show actual dollar expenditures dropping from 1010 to 2014, but then
increasing every year since then.
Perhaps I misunderstood your point. But it sure looks like NATO spending has been rising
since this "New Cold War" really kicked into gear in 3024/2015.
"One big reason they deposed the Shah who was planning to go big with nuclear power with
orders for about 20 French and /or German reactors"
Another hat in the ring for CIA/MI6/Mossad helping to install the Islamic part of the
Iranian Revolution? WooHoo!
"China basically has a monopoly on these metals"
Yes. Bear in mind though that "discovered" after the US invasion/occupation is that
Afghanistan has perhaps the world's largest reserves of lithium. And the "Democratic
Republic" of Congo also has much rare earth wealth. As in fact do other parts of central
Africa. Hence, the AZ Empire's new "AfriCom" military classification and the reinstallation
of French Colonialism.
I'm not so up on this whole tariff thing. Hasn't Germany had substantial tariffs on
automobiles for years now? Do those tariffs apply to other EU states?
Daniel
I have read in the past that Afghan is very rich in a number of minerals and China was
looking at development there as part of it road belt intuitive. Going by the state
Afghanistan is in I can't see the US extracting minerals there. US squatting in Afghanistan
may be simply to deny Chinese access to the mineral deposits.
If NS2 goes online and EU goes dark to Qatar, especially if Iran corks Qatar with a South
pipeline, the Middle East economies will collapse into chaos, and nobody will be buying
either US guns or butter.
US'own economy is going down the crapper with No Taxes for the Rich running an $800B
Deficit, and private Fed Bank ratcheting up $50B at a gulp in interest-only Debt financing
...forever. Collapse of MediCare and MediCaid will bleed even more out of the retsil economy,
which will increase the Deficit, into a National Debt death spiral, and collapse of the
public pensiin systems.
If you project MIC arms spendung and Fed interest-only bleed out, Trump's illegal 25% Fed
VAT sales tax (aka 'tariffs) and EU/RU/CH counter-tariffs, all US health and human services
will be insolvent by 2025.
When that happens, and could happen much sooner, the world we knew in 20C will be
inverted, upended, chaos, albeit, only chaos for the Lower Classes, Workers and Private
Pensioners/401Ks. The Deep Purple Mil.Gov UniParty will...uhh...find a way!
@kgw
"You are agreeing with an idiot, no matter what...Europe has nothing to worry about with
regards to Russia. Unless they threaten Russia."
Well shit or get off the pot why don't you - "idiot" Trump is calling your bluff - stop
freeloading off a (by your assessment) non-existent threat, or he'll stop it for you. Can't
have it both ways. The US can't keep funding your crappy little joke of a disintegrating
"European Union" for ever. Sooner or later you'll have to put on big-boy pants.
James, @44. I largely agree with (and have called for) Patrick's recommendations for what
Ukraine should do now. I don't see anything in there that contravenes what I wrote about
Germany's role in the AZ Empire's coup and resulting war, though.
Do you remember those events, or should I dig out citations? I was following it pretty
closely from mid/late 2013 until it quieted down in 2015. Since then, I just pick up articles
here and there.
When you'd have to be an idiot to agree with Trump ($1 TRILLION MIC arms profiteering
slash National Police State slash MIC Indefinite Detention Gulags), but now you'd have to be
an idiot NOT to agree with Trump (drag EU into the funeral pyre)m then you know it must be
the Red Army v Blue Army media spewfest and the National Novitiate in November is near.
Rahhh.
E pluribus now get back to work. Your 2Q ONE TRILLION Deep Purple State tithe-tibute is
due in 3 more days, ONE TRILKION that you and your hiers will never see again.
USA govt's assessment of China and Russia as "revisionist" should be understood as a
determination to remain the hegemonic power. Thus, we have Cold War II. From that
perspective, European objections to more "defense" spending are considered naive (or worse)
as Europe's fate is views as tied to that of the Empire.
I think European elites are much more likely to side with USA than European people. If
the Trump's talk with Putin doesn't go well, we are likely to see increased scaremongering to
rectify public opinion.
Not to mention those same rare earth metals are getting out of DRC despite millions of
murderous deaths and disease.
And the oil started flowing out of Libya before Gaddafi was even lynched. Oil's been
flowing out of "Kurdish" Iraq into Israel come hell or high water. And of course, ISIL was
shipping Syrian oil through Turkey and Jordan (if not Israel) throughout.
Chaos can make doing business harder, but that can also increase profits. As the
posters said in the '60s, "War Is Not Good For Children And Other Living Things." But it's
great for the psychopaths.
Trump's native approach I suspect may be something like that of fellow-New Yorker and great
American chess player Bobby Fischer who famously said: "Try something!"
That sounds about right. I would only add that Minsk Accord is another example of a
non-agreement. Ukraine never signed yet Russia is accused of not implementing this
non-agreement whenever people feel the need for some more Russia-bashing.
Here is an article that explains the relationship between Russian pipelines, USA
sanctions on Russia, MH17, Crimea, and Syria. It is an excellent background to comprehend
Trump's accusations about Germany's purchase of gas from Russia. Patrick Armstrong and Pat
Lang seem to think that Trump is about to cut NATO support, reduce/eliminate sanctions
against Russia, and redirect relations with Israel, but I am not persuaded. https://www.unz.com/article/why-was-malaysian-airlines-flight-mh17-shot-down/
by Kees van der Pijl He also wrote a book on this topic.
Trump follows the footsprints of the post-USA Civil War Republican Party policy. From
Chapter 1 of The Politicos 1865-1896 by Matthew Josephson (published in 1938)
"The new industrialist and financial class and the farmers of the North emerged the
greatest gainers by far among the mixed coalition of classes which fought to win the social
revolution underlying the War Between the States. But no less triumphant and dominent was the
war party itself, the youthful organization of professional politicians and officeholders
known as the Republican Party. A minority party in 1860, and victor in a three-cornered
electoral contest, it knew during the war the intoxication of unchallenged power and fortune
beyond calculation, leaving it in command of all the offices of the Federal Government!"
From Beard, Contemporary American History, p.91
It had the management of the gigantic war finances, through which it attached to itself
the interests ... of the great capitalists and bankers throughout the North. It raised
revenues by a high tariff which placed thousands of manufacturers under debt to it and
linked their fortunes also with its fate ... Railway financiers and promoters of all kinds
had to turn to it for privileges and protection...
jackrabbit@59
surprised to hear you say Ukraine did not sign MinskII. On the contrary, I read that it was
signed by LD Kuchma, Second President of Ukraine. Please correct me if I am wrong.
Signatories
The document was signed by:[23]
Swiss diplomat and OSCE representative Heidi Tagliavini
Former president of Ukraine and Ukrainian representative Leonid Kuchma
Russian Ambassador to Ukraine and Russian representative Mikhail Zurabov
Separatist's leaders Alexander Zakharchenko and Igor Plotnitsky https://en.wikipedia.org/wiki/Minsk_II#Signatories
All-night negotiations on Wednesday ended with the signing of the Declaration of Minsk in
support of the "Package of Measures for the Implementation of the Minsk Agreements" by Angela
Merkel of Germany, Francois Hollande of France, Petro Poroshenko of Ukraine and Vladimir
Putin of Russia and release of the full agreement. The talks, according to some reports,
almost collapsed near the end as Ukraine and rebel leaders balked at signing.
https://www.forbes.com/sites/paulroderickgregory/2015/02/13/putin-comes-out-on-top-in-new-minsk-agreement/#21ffe18f4ede
From Chapter 1 of The Politicos 1865-1896 by Matthew Josephson (published in 1938):
"The prosecution of the war against rebellion had been associated with a protective tariff
levied against a hated England. which profited and sought to profit further from our
disaster. With the close of the war, a cry arose from the Northeastern region that high
tariffs were needed to pay the war debt. and an outburst of high Protectionism followed in
1866."
Everything the US does works to undermine its old power in the new world. We see this
continually. Trump is an accelerator. But whether any of this is intentional and actually
desired by a part of US vested interests, is still an open question.
Nevertheless, as we watch, we see every action of the US working to cement the bonds
of its opposition in the rest of the world. From the Escobar article linked by karlof1 above,
we see the pressure on the Middle East to reject the US and turn for safety to the Eurasian
institutions of commerce, finance and national security. The same thing is happening to
Europe.
Some days I think that Trump was a brilliantly inspired choice of some deep state players
to further their agenda of fragmenting the old arrangements to allow new alignments to come
into place - to modernize the elite control of the world. But most days I just don't know.
What can one say about a force this magisterial and still this enigmatic?
I was talking with a friend today about Trump. She said she sees his approach as quite
typical of US business style. You come out with the big stick, knowing it will get chopped in
half by the time you get to agreement. But at least you end up with half a stick. Gotta start
big. You don't ask, you don't get.
This style worked perfectly with North Korea, which was a standout among the nations of
the world, in my opinion, for understanding superbly well how Trump played the game, and
played it right back. The result was a meeting of equals, where something could actually get
done. But NK worked hard to develop the bargaining chip to put on the table too. Words
without substance don't work.
I'm not seeing many other countries responding with this same kind of exaggerated bravado
- it is a very US way of doing business. Most countries are simply working to go around the
US. Europe seems to be doing the same thing, simply rejecting and turning away. But the
European countries could certainly create bargaining chips if they wanted to play the Trump
game of negotiation. I truly suspect his style is something they're still getting to grips
with. Perhaps they should call Kim for pointers.
I think ultimately we are seeing two things at work, and in tandem: the natural style of
Trump, and the very real and unstoppable current of history. Whether either force is aware of
the other, I can't say. Like the success or failure of the French Revolution, it's too soon
to tell.
@65 Good summary. I think the Europeans simply don't know what to make of him. The look on
Stoltenberg's face said it all. They just don't know how to respond to someone so direct.
Maybe Putin is the only one who can talk his language....but not in public.
China's taking a page from Mahan regarding sea power. NATO graphs: I mentioned Obama
ordered an increase in spending and the chart shows the compliance. The ups and downs
correlate well with wars and major recessions.
@53 daniel... what you said earlier - i think much the same way... i would be curious to know
more of how patrick armstrong sees all that, but i think it is much the same as us too..
those links @53 reflect how messed up ukraine is at present.. having a failed state on your
doorstep doesn't sound like fun and that works both ways for europe and russia.. i guess that
was the usa ( and israels?) plan... screw up countries so they don't function properly, so
you have to spend a lot of imf money to fix them.. works for wall st, lol..
@38 "The answer to all 3 questions is: we're out of here, defend yourselves"
Patrick, I'm confused: they are meant to defend themselves against whom, exactly? T he
equation as it stands now is this: A muscle-bound USA + an anaemic Europe "deterring" a
Russian Federation that has no intention of invading.
Remove the muscle-bound Americans from the equation and this is what remains: An anaemic
Europe "deterring" a Russian Federation that has no intention of invading.
Since Russia is no threat either way then there is no need - none whatsoever - for the
Europeans to increase their military expenditure to "defend themselves" against a
non-existent Russian threat.
Indeed, the only reason the Europeans would feel that they might have to prepare to
"defend themselves" would be because that muscle-bound US military is now outside the tent
pissing in, not inside the tent pissing out.
@68 Maybe they thought Ukraine would join the EU at some point but Crimea was the prize. The
plan was to turn Crimea into a NATO base. Putin spoiled everything.
Wikipedia also says (as part Leonid Kuchma's bio):
Since July 2014, Kuchma has been Ukraine's representative at the semi-official peace
talks regarding the ongoing War in Donbass.
Why are they "semi-official"? Because Ukraine would not talk to the rebels
directly. They believe that the rebels are sponsored by Russia so the dispute is between
Russia and Ukraine. They would not talk to the rebels as that might convey legitimacy to the
rebels. That's why the Trialteral Contact Group was set up. The signers of Minsk II (Russia,
Germany, France, Kuchma/Ukraine) are merely "guarantors" of an agreement between Ukraine and
the Donbas rebels - neither of which has actually signed.
Kuchma "represents" Ukraine but can't bind Ukraine. Although Poroschenko attended some of
the talks, he never signed the agreement.
Minsk and Minsk II have reduced conflict somewhat but Ukraine has dragged its feet every
step of the way. For example: they were slow to pull back heavy artillery as called for under
the accord, then they wouldn't pass laws that were necessary for other provisions of the
accord.
The Minsk accords outlined a detailed procedure through which Donetsk and Luhansk would
receive "special status," hold internationally-recognized elections, and then negotiate
their reintegration into Ukraine directly with Kiev, including basic constitutional reforms
to federalize the country. No substantive steps have ever been undertaken by either side to
implement these terms, and the new "Donbass Integration Law" now makes clear that Kiev
expects the country to be re-united on its terms alone, though probably not anytime
soon.
Ukrainian lawmakers, who overwhelmingly passed the bill on Jan. 19, argue that it
simply normalizes a situation that has long existed but was clouded by misleading jargon
and official fealty to the non-functioning Minsk accords .
Poroschenko signed the bill into law in February 2018.
@dh "Maybe Putin is the only one who can talk his language"
Going by what Putin said of Trump after their 2 1/2 hour meeting in Vietnam, it seems more
likely Trump talks in Putin's language when meeting actual leaders. Same would go for his
meeting with KJU, and I would guess Xi.
Since whenever, America has been the proxy front for the current instantiation of
empire with the core of control being ongoing private finance with global tools like BIS,
IMF, World Bank, etc. Since WWII and even before the goal of empire is to have all of the
world under its control. Since the engine of empire is a supra-national matrix of private
finance control, the enemy becomes any nations who do not want to be impregnated with the
Western model of private Central Bank, an oligarchy , inheritance, private property,
etc.
The empire model of growth through wars and boom/bust expansion has reached its
"logical" limits and the the existential question has become, blow everything all up or agree
to a multipolar world. I think that the elite hope Trump's bluster will make it so they do
not have to answer that existential question.....yet
The EU has always been a bastard child with little chance of growing up because there was
no finance core agreements to manage the national variations within. I am surprised it has
lasted as long as it has given the historical tension between the nations. The US has similar
social tensions but our structure has homoginized the economy enough that we haven't
imploded...yet
The key to this process which I believe is being managed by the elite is at what point are
the big decisions made and by whom. Given the accelerated nature of the managed
deconstruction, I suspect the elite believe they will retain their mystique of power long
enough to not lose grip on private finance running the Western world. The EU countries will
have to come to terms with their oligarchs and determine what path forward works for all of
eurasia. I don't see the current leadership of any EU countries as having the public's best
interest in mind or action.
Are we seeing Western plutocracy fail of its own "weight"? Perhaps so.....nice
I LUV how Trump stomped on all those preaning European elite scumbags. He's my hero
for pooping all over their little pride parade. Tell em like it is Donald they call you
stupid and all those other useless names. Your stinking GENIUS. MORE and an ENCORE!!!!
Agree with Patrick. It is surprising to still see so much animosity towards a
president who has done more to combat the absurdity of NATO and globalism than I can remember
any other President doing. The ball is in the EU elites court, now. Put up or shut up and I
believe it makes no difference to Trump. We are about to find out who is REALLY to blame for
marching lockstep with the current of hypercentralization (globalism): the Trump admin or the
EU elitez.
Sorry for the break in the Trump-bashing. Let's all get back to that good ol'
America-hatin' catharsis.
Since the start of the 70ties I have heard exactly the same tune from the US and the
blathering idiot in charge now has not changed the tune; ever since have I had to listen to
this "The Russians are coming" tune, with the rhetoric getting ever more shrill and false,
1989 brought a brief and marvelous, albeit very short pause to this tune, and for a few years
the US Kleptocracy was happy plundering the former USSR. When Russia resisted the plunder i.
e. Putin was elected, the tune started over again from where it was paused, disregarding the
fact that Russia does not in any way compare to the former USSR.
N, noooe , it is still "The Russians are coming" playing, but with a new beat, pepped up,
but same substance. But we are not listening anymore, the disgraceful actions and evil
behavior of The United States of Mordor, have come into the open (The internet, appreciate
it, we will not for long have it in its present form), even the most daft of us quietly
starts wondering.
Well I am not daft, and the questioning ended 4 decades ago, The US must be resisted. Our
politicians here on the continent must wake up and reject US imperialism and militarism, and
devise our own defenses if deemed necessary, many European nations are not at the living
standards we enjoy in Scandinavia, surely the money were better spent on that.
If the Poles and Baltic's want American troops on their soil, withdraw EU spending, we do
not need their insane sabre rattling. (Especially the Poles are vile, they forget that when
Hitler invaded, they had been a fascist dictatorship for years).
What exactly has Trump done to combat the absurdity of globalization and NATO besides
talk? While he stopped TPP and TIPP he is negotiating similar agreements bilaterally. Also
his Personal Empire benefits from globalization.
US only contributes 1% of their defense budget to NATO's direct costs so pulling out of
NATO would make hardly a dent in the budget except to increase costs to relocate all the
personnel and hardware. Those bases are invaluableHis calling for NATO countries to increase
defense spending benefits US and Israeli companies who make up the military and security
industrial complex and wont do squat to lower the defense budget
Born and raised in Southern California, been here 70 years... The US has been
manipulating NATO ever since it was formed. Most NATO officials are vetted by the US. Trump
is an idiot, like the bulk of US politicians.
@kgw
"You are agreeing with an idiot, no matter what...Europe has nothing to worry about with
regards to Russia. Unless they threaten Russia."
Well shit or get off the pot why don't you - "idiot" Trump is calling your bluff - stop
freeloading off a (by your assessment) non-existent threat, or he'll stop it for you. Can't
have it both ways. The US can't keep funding your crappy little joke of a disintegrating
"European Union" for ever. Sooner or later you'll have to put on big-boy pants. Methinks this
guy has a good take on this.
You're assuming Europe's leaders aren't bought and paid for by Wall Bank Street Banksters.
The system is rigged. I wouldn't doubt that they go into lapdog mode and bow to blowhard
Trump.
Mrs Merkel emphasised that the German armed forces would remain commanded by parliament and
not the government, and "would not take part in every mission".
This here is a clear description of the issues
involved . Of course, in the rivalry between the US and Russia, Europe's interest is best
served playing the two off each other united. It is no surprise both - the US and Russia -
have a strategic interest to split Europe. You don't believe Russia doing this, too? This
here is from Greece . No, their government is not anti-Russian.
Macedonia is expecting an invitation at the NATO summit in Brussels this week to join
following its landmark deal with Greece whereby it will change its name to the Republic of
North Macedonia. Moscow strongly opposes NATO expansion.
...
The Greek diplomatic source told Reuters Athens would expel two diplomats and bar two
other Russians from entering the country due to concerns that they were involved in rallies
in Greece against the deal with Macedonia and that they had attempted to offer money to
Greek state officials.
Becoming a "neutral" military force would end this type of nonsense. Trump acting like
mafia is another strong incentive.
"The U.S. military is the biggest socialist organization of the world. It is
egalitarian and its citizens, i.e. the soldiers, are extremely well cared for. It runs its
own healthcare system through the Veterans Health Administration."
A wonderful conclusion b.
Does anyone know of any in-depth economic analysis of the U.S. military as a state
welfare system for its members, as well as the impact of aggregate military spending on the
general purchasing power of citizens within the society at large?
And US military spending is also an enormous job-creation and wealth-redistribution
program in the form of defense contractors spread all over the nation, where they are
especially vital for areas with weak employment.
The US winds up with a lot of projects it does not need because Congresspeople are not
about to kill a program that employs thousands in their districts.
Why should Germany spend 4% on its military? Didnt see that coming from this blog. Are
germany facing an enemy? If not, its a waste of more money. All this useless money could be
spend to actually strenghten the welfare state. Something that actually matters and are much
needed. So which enemy is Germany facing? Either Trump is right that Russia is a threat to
Germany or hes not. What is it?
The nonbinding motion, which came as the Senate voted to reconcile its version of the
annual defense policy bill with that of the House, expresses the Senate's support for NATO
and calls on negotiators to reaffirm the U.S. commitment to it. The 97-2 vote in the Senate
comes as Trump heads to Brussels.
Trump's "reasoning" makes sense in an infantile sort of way, but there's more too it
than meets the eye, is there not? Trump doesn't just want to Europe to "pay their fair share"
for NATO, which we all know is code for buying more US mil.gear but also to buy their LNG
from US too. It's like NATO is some sort of grotesque, evil franchise where the franchisees
can only buy goods/services from that single source, even though it's crap & inordinately
expensive, and even if you can get it cheaper elsewhere, i.e Russia.
I would love to see those fence-sitting NATO countries tell the US "sure, we'll increase
our mil. spending, but after what we saw in Syria, we'll be buying our gear from Russia"
(more bang for the buck too!) - that would be game, set & match right there!
I think you are wrong, Bernard. It will sell well in Europe too. To what extend were the
themes of the Brexit campaign based on Germany as the slave master of Europe, to exaggerate
slightly? It will also sell well in the US.
Wow! You don't feel that Trump has, by his mere existence and by winning the
presidency, been given a platform of which to decry the myriad injustices of globalization
and to utter things unspeakable by any Prez in the last fifty years?
I don't think you've been paying attention. The proof is in the pudding but what will be
the benefit of raising the spectre of doubt over bad deals like NATO, the current iteration
of world trade, and for animosity towards Russia? Evidently, it ain't worth shit to
predictable TDS-sufferers that hang around here.
So much for those who projected that Trump's demands for an increase in the defense spending
of other members and his scolding of Germany would lead to a weaker Nato! Nato members just
caved to Trump and are increasing their spending and Trump is touting that Nato is stronger
and everyone's doing the kumbaya.
When I say that Trump is establishment on steroids; it's an understatement. Trump is doing
the kissy, kissy with Putin because the plan is to pull Russia away from collaborating with
China. Zionist oligarchs are in league with Trump and Russia will eventually be under their
complete control.
@98 You just don't get it. Trump is fascist establishment. Trump is separating kids from
their mothers. Who does that??? He's a sick sadist.
Europe has an arms industry of their own. I doubt European countries invest their
money into US stuff - they buy their own. Most of the money does not go into weapons anyway,
but personel and administration. Germany contributes to the maintenance and infrastructure of
US bases, but those bases are business, too. This is not Saudi Arabia buying protection. The
real news is that Trump has started
a trade war negotiating by tantrum.
But Trump has a great point: if you claim that Russia is ready to invade you, why you are
buying gas from potential occupier?
Notable quotes:
"... Russia is a near neighbor to Germany. Commerce between relatively close countries is the normal course of events, so what is Trump suggesting, a 1970's style energy embargo on Russia? Depriving Russia the opportunity all trade with her neighbors 'because we said so' is no better than a blockade. ..."
Donald Trump, the 'America First' salesman, came to Brussels today to demand more tribute
to the empire. He wants Europe to buy more U.S. made weapons and to use U.S. liquefied
natural gas (LNG). But his arguments are all wrong. The people in Europe are not impressed by
them and they will reject his appeals.
His first talk in Brussels was
a profoundly wrong bashing of Germany to push it into buying very expensive LNG from U.S.
fracking producers. Trump, Putin's puppet according to the 'resistance', used the Russian
bogeyman to set the scene:
Well, I have to say, I think it's very sad when Germany makes a massive oil and gas deal
with Russia, where you're supposed to be guarding against Russia, and Germany goes out and
pays billions and billions of dollars a year to Russia. ... So we're protect you against Russia, but they're paying billions of dollars to Russia, and
I think that's very inappropriate. And the former Chancellor of Germany is the head of the
pipeline company that's supplying the gas. Ultimately, Germany will have almost 70 percent
of their country controlled by Russia with natural gas.
So you tell me, is that appropriate? I mean, I've been complaining about this from the
time I got in. It should have never been allowed to have happened. But Germany is totally
controlled by Russia , because they will be getting from 60 to 70 percent of their energy
from Russia and a new pipeline. ... Now, if you look at it, Germany is a captive of Russia because they supply. They got rid of
their coal plants. They got rid of their nuclear. They're getting so much of the oil and
gas from Russia. ... I think trade is wonderful. I think energy is a whole different story. I think energy is a
much different story than normal trade. And you have a country like Poland that won't
accept the gas . You take a look at some of the countries -- they won't accept it, because
they don't want to be captive to Russia. But Germany, as far as I'm concerned, is captive
to Russia, because it's getting so much of its energy from Russia. So we're supposed to
protect Germany, but they're getting their energy from Russia. Explain that. And it can't
be explained -- you know that.
Trump was talking about the Nordstream II pipeline which will supply Germany and other
European countries with natural gas from Russia.
It is indeed hard to believe that western european governments would agree to what
Christopher Black calls a "US shakedown". Except that they have been doing so since 1949.
It is important to remember that the US Embassy exerts at least as much influence on the
government as Parliament does. And that Parliaments are full of agents of the the US empire,
in some cases they are actually on the payroll, many more are either US educated, marinated
in the imperialist ideology or in the service of corporations which know that the Empire is
the final guarantor of their survival and capable of crushing them with ease.
That having been said, things are changing, The imperialists cling to power only by exerting
the most extraordinary, and unsustainable, pressure. An example of which is the ludicrously
over-wrought campaign against the left in the UK being waged by the Israeli Embassy, with the
assistance of the entire MSM.
B's arguments are correct but it will take a mobilised and politically conscious public
opinion to impose them on governments full of people who see themselves as Washington's
servants and expect to be rewarded one day for being loyal to the US and for betraying their
countrymen and, of course, women.
The question is if Europe will truly continue to bark and bite at the deep state or if this
is all just for show and they'll eventually capitulate. I'm worried that this is nothing more
than political theatre. I'm not expecting much from the Europeans. But we'll see.
Europe buying LNG from the US just makes no sense at all. Aside from the cost, LNG is
difficult to transport and work with; the whole idea is just nuts, especially considering the
quantities involved. In addition, Russian gas is plentiful and cheap, so to expect Europe not
to use it is also nuts.
Could it be that Trump fully understands this and the hidden agenda is to get out of NATO and
bring home the troops?
Russia is a near neighbor to Germany. Commerce between relatively close countries is the
normal course of events, so what is Trump suggesting, a 1970's style energy embargo on
Russia? Depriving Russia the opportunity all trade with her neighbors 'because we said so' is
no better than a blockade.
One of these days, my country is going to get a taste of, 'no soup for you' and we will be
screaming like stuck pigs.
Yes, I am obsessed w/Sean Hannity
It's his earnest, self-righteous, mind numbingly idiotic voice, I'm hypnotized. Ollie
North was on his show and they were going on about 'Iran's' saber rattling by threatening to
close the Straits of Hormuz. Sean rattled off how the EU would wake up and it would be the
end of Iran's belligerence.
He neglected to mention that this 'threat' is only coming after our act of war by actively
trying to cut off all of Iran's oil exports which is no better than a naval blockade.
Much can be gleaned from
this NATO Defence Expenditure pdf with special attention given to graphs 5, 6
& 7. Since the dissolution of the USSR, military spending as share of GDP by EU &
Canada decreased about 50% as shown in Graph 5. It should also be noted that the demand made
by the Outlaw US Empire for EU NATO members to increase their wastage of monies on military
equipment began with Obama in 2015, with compliance noted by the graphs in 2016. When Obama
gave his orders, very little squawking was heard from EU/Canada governments, although it was
quite different from the public. Of course, EU/Canada are caught in a trap of their own
design--Russia's quite obviously not the "aggressive" nation that must be defended against
using all necessary means as promoted by Russophobic Media Propaganda as they all trade and
benefit from commercial interactions; thus, bean counters see NATO as a wastage of vital,
finite monies that ought to be spent on productive endeavors advancing the human condition.
In national legislatures: "Russia's a growing threat to humanity!!--BUT--No, I'm voting
against any increase in military spending as there's no need for it."
European members of NATO don't need such an organization. If they were to join the Russian
and Chinese enterprises to unite Eurasia into a common economic zone, then the need for NATO
would become indefensible. And their finally becoming independent of the Outlaw US Empire's
diktats would provide the impetus required to finally solve the status of Palestine and
reaffirmation of the paramountcy of International Law as a greatly expanded Multipolar Order
would be established. The United Nations might actually begin to function as designed.
Is Trump trying to push NATO apart by injecting it with a dose of American Chaos? Force
EU/Canada to declare their independence from the Outlaw US Empire for numerous reasons? All
of which would force the contraction of the Overseas element of the Empire and install an
actual defense policy, not one aiming to control the world? Is this Trump's way to force a
Neocon retreat?
Meanwhile, China charms Arabia
"Under the radar,..., the eighth ministerial meeting of the China-Arab States Cooperation
Forum (CASCF), established in 2004, sailed on in Beijing, hosted by President Xi Jinping."
Please note the article's citing of new demands made to Iraq by the Outlaw US Empire, which
has their roots in Trump's appraisal of the situation.
I'd say this is why you do not mix a military alliance with politics. Nor allow federal
presidents to command and represent an army. Trump's retarded bullshit aside the USA
shouldn't be holding committee meetings with allies without an war. An alliance shouldn't be
considered active during peacetime. An ally is a figment of political imagination until
military necessity requires it in actuality. Historically and currently a military alliance
is treated as a contract for warmongering against an outnumbered enemy while at peace or at
war. Which is why honorable people (currently very few) eschew alliances or non-aggression
agreements until they become a defensive requirement. If President Trump want's to crash NATO
with no survivor's, more power to him.
The bright side of Trump bullying is revealing NATO astronomical hypocrisy as they join
psychotic delusions about Russian menace they refuse to put money where their mouth is and
shamelessly disclose their vassal status begging for American military support for free.
All that knowing well that there is no threat from Russia that cannot be eliminated simply
by good neighborly relation with Russia not by spending $billions on otherwise useless
fraudulent US MIC junk.
Is that nor reverse psychology that is in play here, put up or shut up, let me make deal
with Russia so you do not have to spend on military rediculous sums to match your delusional
rhetorics about Russian threat.
Trump is s gambling man, wants to make money for US MIC on anti Russian lies or make money
for US industry on Russia peace and cooperation truths.
"Stoltenberg: [ ] I think that two World Wars and the Cold War taught us that we are
stronger together than apart.
Trump: But how can you be together when a country is getting its energy from the person
you want protection against or from the group that you want protection?
Stoltenberg: Because we understand that when we stand together, also in dealing with
Russia, we are stronger. I think what we have seen is that --
Trump: No, you're just making Russia richer. You're not dealing with Russia. You're making
Russia richer."
You'd have to be an idiot not to agree with Trump here.
A notable difference between the way Trump treats the likes of Putin, Xi, and Kim Jong Un
- all leaders in their own right - to the way he treats the EU poodles. Zero respect for the
poodles.
Posted by: Peter AU 1 | Jul 11, 2018 6:40:20 PM |
22
"... The big advantage for Germany is that (Nordstream I and Nordstream II] pipelines
do not run through any other country ..."
That's because idiot EU / NATO countries like Denmark, who would gladly accept having the
pipelines pass through their land and maritime territories (and the transit fees that go with
them) if Russian gas were not flowing through them, prefer to support the Nazi whacko
Banderites ruling Ukraine who whine that all Russian gas should transit Ukrainian territory
in deteriorating pipelines. So Denmark and others refuse to host any part of the pipelines at
all.
When Gazprom starts sending all gas through Nordstream I and II and pipelines through the
Black Sea, completely bypassing Ukraine, then that country will be close to bankruptcy.
Denmark and everyone else in the EU and NATO had better be ready to rescue the
Banderites.
Der Speigel 's fact-checking article of Trump's assertions provides some
interesting facts, all in German, which I used Yandex to translate. To counterargue Trump's
most pointed assertion that Germany's a captive of Russia, the author provides this rebuke:
"Russland ist auf den Abnehmer Deutschland angewiesen. Die Deutschen benötigten die
Russen vor allem als Lieferanten für Erdgas." (Russia is dependent on the customer
Germany. The Germans needed the Russians mainly as suppliers of natural gas.) Overall:
"Für Russland ist Deutschland als Handelspartner wichtiger als andersherum. Von allen
deutschen Importen kamen 2017 nur drei Prozent aus Russland - und lediglich zwei Prozent der
Exporte gehen in Putins Reich. Für die Russen war die Bundesrepublik mit einem Anteil
von 8,6 Prozent ihres gesamten Außenhandels der zweitwichtigste Partner hinter China.
Und mehr als zwei Drittel der russischen Exporte nach Deutschland waren Erdgas, Öl und
Steinkohle." (For Russia, Germany is more important as a trading partner than elsewhere. Of
all German imports, only three percent came from Russia in 2017 - and only two percent of
exports go to Putin's Reich. For the Russians, Germany was the second most important Partner
behind China, accounting for 8.6 percent of its total foreign trade. And more than two-thirds
of Russian exports to Germany were natural gas, Oil and coal.)
Clearly, the total trade turnover between Russia and Germany represents just a small
fraction of their totals, and both nations would likely find a replacement if a total embargo
was to ensue.
The US began pressuring countries to forego nuclear power to support the Petro Dollar in
1978. One big reason they deposed the Shah who was planning to go big with nuclear power with
orders for about 20 French and /or German reactors
The TMI accident was likely a false flag run by the newly established FEMA.
If the restrictions on recycling nuclear fuel rods were eliminated there would not be a
disposal problem.
Germanys decision to phase out nuclear makes US happy. Germany will only accept Nord
Stream 2 if it does not bypass Ukraine. This also makes US happy although they would prefer
no Nord Stream 2. As said up thread this is as much about posturing before the Putin meeting
and gaining leverage.
A bit O/T but it appears rare metals needed by US military and tech industries are on the
list of products subject to tarrifs. China basically has a monopoly on these metals so the
only short term purpose is to drive up prices for weapons and tech gadgets which get passed
onto the taxpayer/consumer. In effect the tarrifs are just another revenue source to finance
tax cuts to corporations and the rich.
Longer term of course the tarrifs make mining some of these metals in the US more
feasible, at some cost to the environment , seeing as EPA has been gutted. But for that to
happen the tarrifs need to be more or less a permanent thing. Its not like they dont have
tarrifs on food and clothes from China. Just expanding the revenue base. The middle class
takes the hit in the end, whats left of it anyways
Trump as a used car salesman does not make much sense either. In fact I don't think he can
spell to sense. It telling that he is impervious to the mood in both NATO and the EU.
His middle name should be clueless. He is truly clueless, he will not get an increase in
defense expenditure, it would be political self goal (Hello Engeland, no not football, that's
more like clueless) for any major political party to demand that, the electorate across
Europe are firmly against it. Ohh and who cares about Perfidious Albion, they are not part of
Europe anymore, they are some Islands with bad weather in the North Sea.
Seabird sanctuary ?
Europe hopefully comes to its senses and casts of the American yoke, and fashion its own
defences, based on ITS needs.
thanks b.. informative and interesting comments from everyone too.. thanks..
trump is a hard guy to read in some respects... he is like a blunt object on the one hand,
but he might have some alternative purpose in mind, which would include the meet with trump
in 5 days..
if he wants to get rid of nato, i think he is going about it the right way.. i can't see
why he would though as that wouldn't benefit the mil complex...i can't see the purpose of
nato either way and perhaps it would be best if the poodles let go of having the usa as it's
leader in the 21st century.. consider a different approach... i am not sure what canada and
other western type poodles can do with all this..
@7 karlof1.. thanks for the pepe link... i just don't see the approach - bullying - taken
by the usa to iraq, as working out.. i am listing the demands for others to see
firsthand..
"
1. 30% of all the oil in Iraq should be American-controlled – and it's up to the US do
what it wants with it.
2. Washington must have full access and control of Iraqi banks.
3. All business and trade with Iran must cease right now.
4. The Hashd al-Shaabi, known as People Mobilization Units (PMUs), instrumental in the
victorious fight against Daesh (Islamic State),
must be immediately disbanded."
the usa takes this approach based on weakness, not strength... in fact - if one was to
read trumps comments on the surface here - it is the same thing that b has highlighted in
this post.. again - the usa is not working from a place of strength.. it is like a wild
animal in the last phase of it's life - not good..
Lost in the story is fact it is not new supply of natural gas to Europe. It is new pipe
lines including two others with the sole intent of bypassing Ukraine. Presently near all
Russian natural gas passes through Ukraine on its way to Western Europe and particularly ..
Germany. The Ukraine regime has been reaping the benefit of transmission fees and stealing
billions of cubic meters of gas, on which they also charged transmission fees. This was the
basis behind a recent dispute panel finding in favor of Ukraine and the gas theft. The
Americans and willing European Poodles would very much like to keep the gas flowing through
Naziville where they would maintain a strangle hold. Gazprom, the principle Russian supplier,
more or less said f**K you and formed consortiums to build new pipe lines
@32 So if Germany gets gas through Nordstream they are 'controlled by Russia' but if they
get it via Ukraine they aren't. Seems Nordstream would be good insurance against Ukrainian
meddling. Cheaper too, a very sound business strategy that Trump should appreciate.
"... President Trump's demand last week that OPEC "reduce prices now" or US military protection of OPEC countries may not continue almost sounded desperate. But if anything, Trump's bluntness is refreshing: if, as he suggests, the purpose of the US military – with a yearly total budget of a trillion dollars – is to protect OPEC members in exchange for "cheap oil," how cheap is that oil? ..."
"... Exactly how traditional 'US Mideast policies' benefit the average American however remains a mystery. Many of these questionable policies are never critically examined in the open – at least not the big ones involving that 'special relationship' with you-know-who. Never. ..."
"... Iran's crime? That nation's alleged 'sponsorship of terrorism' in support of the Palestinian struggle against Zionist occupation, as well as other anti-Zionist resistance movements in Lebanon, Syria and beyond. ..."
"... Yet it is Israel that is foremost occupying power in that region and it is Israel that is the expanding nuclear power. Meanwhile, the Zionist-lead BDS campaign against Iran is nothing less than a full-blown economic war. At the same time, Israel benefits from unconditional and continuous US subsidies. ..."
"... In no small way, Israel sees its mission to dominate the region and expand its borders as a religious duty. Destiny. This puts Israel in a class by itself. And unlike its neighbors (including Iran) Israel has nuclear WMD. ..."
President Trump is finding that his threats and heated rhetoric do not always have the
effect he wishes. As his Administration warns countries to stop buying Iranian oil by November
or risk punishment by the United States, a nervous international oil market is pushing prices
ever higher, threatening the economic prosperity he claims credit for. President Trump's
response has been to demand that OPEC boost its oil production by two million barrels per day
to calm markets and bring prices down.
Perhaps no one told him that Iran was a founding member of OPEC?
When President Trump Tweeted last week that Saudi Arabia agreed to begin pumping additional
oil to make up for the removal of Iran from the international markets, the Saudis very quickly
corrected him, saying that while they could increase capacity if needed, no promise to do so
had been made.
The truth is, if the rest of the world followed Trump's demands and returned to sanctions
and boycotting Iranian oil, some 2.7 million barrels per day currently supplied by Iran would
be very difficult to make up elsewhere. Venezuela, which has enormous reserves but is also
suffering under, among other problems, crippling US sanctions, is shrinking out of the world
oil market.
Iraq has not recovered its oil production capacity since its "liberation" by the US in 2003
and the al-Qaeda and ISIS insurgencies that followed it.
Last week, Bloomberg reported that "a complete shutdown of Iranian sales could push oil
prices above $120 a barrel if Saudi Arabia can't keep up." Would that crash the US economy?
Perhaps. Is Trump willing to risk it?
President Trump's demand last week that OPEC "reduce prices now" or US military
protection of OPEC countries may not continue almost sounded desperate. But if anything,
Trump's bluntness is refreshing: if, as he suggests, the purpose of the US military –
with a yearly total budget of a trillion dollars – is to protect OPEC members in exchange
for "cheap oil," how cheap is that oil?
At the end, China, Russia, and others are not only unlikely to follow Trump's demands that
Iran again be isolated: they in fact stand to benefit from Trump's bellicosity toward Iran. One
Chinese refiner has just announced that it would cancel orders of US crude and instead turn to
Iran for supplies. How many others might follow and what might it mean?
Ironically, President Trump's "get tough" approach to Iran may end up benefitting
Washington's named adversaries Russia and China – perhaps even Iran. The wisest approach
is unfortunately the least likely at this point: back off from regime change, back off from
war-footing, back off from sanctions. Trump may eventually find that the cost of ignoring this
advice may be higher than he imagined.
Trump may eventually find that the cost of ignoring [the advice to back off from Iran]
may be higher than he imagined.
Perhaps he's counting on not being President by then. Another case of IBGYBG (I'll be
gone, you'll be gone), an attitude that seems to be infecting bankers, Wall Street, and the
rest of the U.S. élite lately. A cataclysm is coming, and they can see it.
Why is Zio-America treating Iran with such hostility?
Iran and Israel are locked in a vicious cold war. Their animosities date back to mythical
antiquity. One alleged episode is even celebrated in the Jewish celebration of 'Purim'.
Take a look at the breathtaking insight that Gilad Atzmon has to offer about Purim:
In any case, Iran and Israel's antipathies for one another shouldn't concern superpower
America. Except that it does.
Like American television, Washington happens to be Israeli-held territory. Haven't you
heard?
This is why Zio-Washington invariably sides with Israel in all of its disputes, even when
1) Israel is the aggressor, 2) even when Israel is slaughtering powerless civilians who are
protesting their subjugation, and 3) even when US interests are not at stake or even in play.
And this uniform deference from Washington is thoroughly bipartisan. It is 'business as
usual'. It's basically unanimous. Both Parties. No dissent.
Many just call it 'US Mideast policy'. Ironclad. 'Unshakable'. But don't laugh or smirk.
Doing so might be seen as 'anti-Semitic'.
Exactly how traditional 'US Mideast policies' benefit the average American however
remains a mystery. Many of these questionable policies are never critically examined in the
open – at least not the big ones involving that 'special relationship' with
you-know-who. Never.
These rigid policies help explain how Crypto-Israelis in America – using Washington
as their proxy – have successfully brought the US into Israel's cold war against
Iran.
Zionist operatives have not only orchestrated the decades-long freeze of billions of
dollars in Iranian assets that belong to the Iranian people, but they have launched a global
(and crypto-Zionist) 'Boycott, Divestment and Sanctions' campaign against the relatively
peaceful nation of Iran.
Iran's crime? That nation's alleged 'sponsorship of terrorism' in support of the
Palestinian struggle against Zionist occupation, as well as other anti-Zionist resistance
movements in Lebanon, Syria and beyond.
Yet it is Israel that is foremost occupying power in that region and it is Israel that
is the expanding nuclear power. Meanwhile, the Zionist-lead BDS campaign against Iran is
nothing less than a full-blown economic war. At the same time, Israel benefits from
unconditional and continuous US subsidies.
Politicians who dare question this phenomena – or who wander off the Zionist
plantation in Washington – tend to disappear. Rapidly. Journalists, too.
In no small way, Israel sees its mission to dominate the region and expand its borders
as a religious duty. Destiny. This puts Israel in a class by itself. And unlike its neighbors
(including Iran) Israel has nuclear WMD.
Due to Israeli influence here, Americans are not only actively supporting various Zionist
war efforts, but they are also paying billions more for their gasoline since Zionists have
managed to prohibit the purchase Iranian oil throughout the West. These economic 'choices'
are what Americans unwittingly make – even though the 'average Joe' remains totally
unaware of them.
Indeed, even though Iran wants to be a trading partner with America and bring its oil onto
the world market, Zio-Washington says 'NO!' US consumers be damned. The Iranian people be
damned.
This is not the first time that US economic interests have taken a back seat to Israel's.
Please recall the 1973 Arab-Israeli war, Zio-Washington's intervention on behalf of Israel
during that conflict, the ensuing Arab oil embargo, and the disastrous recession that
followed.
But Zio-America never turned it back on Israel, even though American citizens never had
the opportunity to determine their allies or policies one way or another. US support of
Israel is mandatory. It's been this way since LBJ.
Today, Israel is maneuvering Zio-Washington to do to Iran what it did to Iraq, Libya and
Syria; namely, spread destabilization and impose 'creative destruction' upon all nations that
pose any long-term threat to the Zionist State.
"... Flight MH17, Ukraine and the New Cold War. Prism of Disaster ..."
"... Today, Western imperialism projects its global power, as far as capital is concerned, primarily from the perspective of speculative, financial asset investment. Long gone are the days of class and international compromise forced upon it after World War Two. Instead, the predatory instincts of dominant financial capital require forcibly opening up all states for commodification and exploitation. Given the global spread of product and commodity chains, the continued flow of profits to the West cannot be taken for granted as long as effective state sovereignty elsewhere persists. For the liberal, Anglophone heartland of capital, 'defence' is therefore not merely, or even primarily, a matter of upholding the territorial integrity of the states constituting it, but keeping open the arterial system of the global economy and maintaining the centrality of the West. Regime change is a logical corollary, and from this perspective we must view the coup in Ukraine in February 2014 and all ensuing events, including the downing of Malaysian Airlines Flight MH17. ..."
"... Defence Planning Guidance for Fiscal 1994-'99 ..."
"... Self-Determination in the New World Order ..."
"... The Grand Chessboard ..."
"... Russia under Yeltsin had effectively surrendered its sovereignty to transnational capital and the West and as a result was left a social and economic disaster zone. ..."
"... The Anglo-American invasion of Iraq on a false pretext made abundantly clear that the West was abandoning the rules of the post-war international order. 'Democracy promotion' intended to prevent national sovereignty from being mobilised against Western global governance, was now made a priority. The 'Rose Revolution' in Georgia in 2003 and the 'Orange Revolution' a year later in Ukraine, marked the lengths to which the United States was willing to go. ..."
"... To ensure that countries incorporated into the US-NATO sphere of influence, really became neoliberal client states, Pascual and Krasner devised a strategy for preventive intervention with a rulebook listing the measures by which 'market democracy' was to be established. Ukraine was a key target and battleground, because by now, Russia was beginning to contest Western forward pressure. ..."
"... The economic mismanagement and infighting of the different oligarchic clans in Ukraine led to payment arrears and repeated shutdowns of the gas supply from Russia, and Gazprom, the state-owned Russian gas company, early on began to look for ways to bypass the Ukrainian grid. ..."
"... Patriot of Ukraine ..."
"... if the Ukrainians lose control of the narrative ..."
"... If Russia takes Ukraine, Belarus will join the Eurasian Union, and, presto, the Soviet Union (in another name) will be back. ..."
"... Far easier to [hold] the line now, in Ukraine than elsewhere, later ..."
"... weekend of 13 to 14 April, CIA Director John Brennan was in the Ukrainian capital. ..."
"... Anti-Terrorist Operation ..."
"... Parubiy sent out a Twitter message on the 15th that veterans of the Maidan uprising were poised to join the fight. ..."
"... The downing of MH17 on 17 July changed all that. As I said above, who did it and how remains obscure, although there are several pursued by people familiar with local circumstances, or revealed by insiders who know who which military assets were operating that day -- but all that remains inconclusive. The official reports by the Dutch Safety Board and the JIT may be conveniently dismissed although the DSB rightly pointed at the questionable decision by Kiev to allow civilian planes to fly over a war zone. However, irrespective of the actual perpetrator, and whether it was an intentional act or an accident, there is no doubt about the West's intent to exploit the event to the maximum. ..."
"... 'without MH17 it would have been pretty difficult to find sufficient support for the increased sanctions on the Russian economy' ..."
"... Even at the time of the Kiev coup, commentators wondered to what extent shale gas from the US might be used to offset Russian deliveries. LNG facilities planned in Florida and Maryland were projected to serve the European market at Gazprom's expense, a prospect meanwhile far more realistic. ..."
"... The downing of Flight MH17 also definitively sealed the fate of South Stream. Russian banks financing the project, led by Gazprombank, were hit by new sanctions, so that the necessary capital could no longer be raised internationally. ..."
"... Since the F-16 that shot down the Russian jet was part of a pro-NATO unit based at Inçirlik airbase that took part in the coup attempt, the incident over Syria would appear to fit in a framework that may also have decided the fate of Flight MH17: a provocation to throw relations with Russia into disarray, but we don't know for sure. ..."
"... whether managed or violent ..."
"... cover the scenarios from changes of leadership within the current structures, to the emergence of a group ready to pursue structural reform in some sort of accountable dialogue with the Russian population, to regime collapse ..."
"... Washington Post ..."
"... Russia Project Strategy ..."
"... In the current global conjuncture, even the tentative contender coalition combining the Eurasian Union, the BRICS and the Shanghai Cooperation Organisation, constitutes an acute danger to a capitalist West in crisis. Whether the United States and NATO would therefore also be willing to take even greater risks than they are doing now is a prospect too frightening to contemplate. However, it must be confronted, or the fate of the 298 people on Flight MH17 may become that of humanity at large. ..."
Four years ago, on 17 July 2014, in the midst of a civil war raging in eastern Ukraine,
Malaysian Airlines Flight MH17 was destroyed with all 298 passengers and crew. On 25 May last,
the Joint Investigation Team (JIT) entrusted with the criminal investigation of the downing and
composed of the Netherlands, Australia, Belgium, Malaysia and paradoxically, given its possible
involvement, Ukraine, presented its second progress report. Like the first report in September
2016, it took the form of a press conference, with video animations supporting the
investigation's findings. This time there was even less to report; the main conclusion was that
elements from the Russian 53rd Buk missile brigade were the culprits, a claim already made by
the London-based investigative group Bellingcat two years before. In February 2016 that
assertion had still been dismissed as unfit for evidence by the Dutch chief prosecutor on the
JIT, Fred Westerbeke, in a letter to victims' relatives. How can it possibly have become the
core component of the case for the prosecution two years and two months later?
The JIT press conference was immediately followed by a formal declaration on the part of the
Dutch and Australian governments that held Russia responsible. However, JIT member Malaysia
dissociated itself from the accusation, whilst Belgium has remained silent. The obviously
over-hasty conclusion, on the heels of the alleged Skripal nerve gas incident in Salisbury and
the likewise contested Syrian government gas attack on jihadist positions in Douma, all point
in the same direction: Putin's Russia must be kept under fire and there is no time to wait for
a court verdict.
ORDER IT NOW
In my book Flight MH17, Ukraine and the New Cold War. Prism of Disaster (Manchester
University Press), I have refrained from entering the slippery terrain of making claims about
who pulled the trigger, intentionally or by accident, in the late afternoon of 17 July, or even
which type of weapon was used. For the downing of the Malaysian plane has become part of a
propaganda war that was already heating up prior to the catastrophe. Instead the book is about
what we do know about the events surrounding it, in the preceding months, weeks, and days,
indeed even on the day itself. Subsequent events have only underlined that it is this context
that lends meaning to the tragedy.
Refocusing US Supremacy After the Soviet Collapse
Today, Western imperialism projects its global power, as far as capital is concerned,
primarily from the perspective of speculative, financial asset investment. Long gone are the
days of class and international compromise forced upon it after World War Two. Instead, the
predatory instincts of dominant financial capital require forcibly opening up all states for
commodification and exploitation. Given the global spread of product and commodity chains, the
continued flow of profits to the West cannot be taken for granted as long as effective state
sovereignty elsewhere persists. For the liberal, Anglophone heartland of capital, 'defence' is
therefore not merely, or even primarily, a matter of upholding the territorial integrity of the
states constituting it, but keeping open the arterial system of the global economy and
maintaining the centrality of the West. Regime change is a logical corollary, and from this
perspective we must view the coup in Ukraine in February 2014 and all ensuing events, including
the downing of Malaysian Airlines Flight MH17.
Right from the Soviet collapse in 1991, the US global perspective was articulated in several
new strategic doctrines. The first and perhaps foundational one is the Wolfowitz Doctrine,
named after Paul Wolfowitz, undersecretary of defence in the Bush Sr. administration, who
commissioned a Defence Planning Guidance for Fiscal 1994-'99 (DPG) of 1992. It
proclaims the United States the world's sole superpower, which must remain ahead of all
possible contenders in arms technology and never again accept military parity, as with the USSR
during the Cold War. The newly self-confident European Union, too, was obliquely warned that
the US alone would handle global policing.
Additional doctrines, specifying on which grounds armed US intervention might be undertaken
and justified, added elements such as humanitarian intervention (a Carnegie Endowment report of
1992, Self-Determination in the New World Order ); it was applied in Yugoslavia and
again in Libya. Next, the'War on Terror', originally floated at Israeli Likud/US Neocon
conferences between 1979 and 1984, was revived after the collapse of the USSR as the 'Clash of
Civilizations' by Cold War strategist Samuel Huntington; Afghanistan and Iraq stand as
monuments of the application of this doctrine. Finally, Zbigniew Brzezinski's The Grand
Chessboard of 1997 specifically dealt with reorganising the former USSR, including
Ukraine.
Through the different episodes, NATO was transformed into a global policing structure
serving the interests of Atlantic capital. 'Out of area operations', unthinkable in the Yalta
epoch, were first tried out against the Bosnian Serbs in the mid-1990s. The enlargement of the
alliance into the former Soviet bloc, which began around that time too, was obviously motivated
to prevent European departures from US tutelage, hence its bold forward surge. Already in 1994,
Ukraine became the first former Soviet republic to join the Partnership for Peace, the newly
created waiting room for NATO membership. To quell Russian concerns about the advancing West,
the NATO-Russia Founding Act of 1997 laid down that no nuclear weapons and permanent troop
deployments would take place in new member states. Yet Georgia, Ukraine, Azerbaijan, and
Moldova not long afterwards joined a low-key organisation of former Soviet republics (after the
initials, GUAM), another oblique link up with NATO.
Mobilising Georgia and Ukraine against Resurgent Russia
Russia under Yeltsin had effectively surrendered its sovereignty to transnational
capital and the West and as a result was left a social and economic disaster zone. Under
his successor, Vladimir Putin, the country began to mutate back to a society led by a directive
state, assisted by rising oil prices. After the United States unilaterally withdrew from the
Anti-Ballistic Missile Treaty in 2002 and announced a missile defence system deployed in the
CzechRepublic, Poland, and Rumania, Russia shifted to a more robust international position.
The Anglo-American invasion of Iraq on a false pretext made abundantly clear that the West
was abandoning the rules of the post-war international order. 'Democracy promotion' intended to
prevent national sovereignty from being mobilised against Western global governance, was now
made a priority. The 'Rose Revolution' in Georgia in 2003 and the 'Orange Revolution' a year
later in Ukraine, marked the lengths to which the United States was willing to go.
Yet even a colour revolution means little if there is no accompanying make-over of the
fundamental state/society relation. Hence, the incoming policy planning director at the US
State Department, Stanford professor Stephen Krasner, and Carlos Pascual, former US ambassador
in Kiev, developed a comprehensive regime change doctrine in 2004. This would prove a key
element in the subsequent Ukraine intervention. To ensure that countries incorporated into
the US-NATO sphere of influence, really became neoliberal client states, Pascual and Krasner
devised a strategy for preventive intervention with a rulebook listing the measures by which
'market democracy' was to be established. Ukraine was a key target and battleground, because by
now, Russia was beginning to contest Western forward pressure.
At the Munich Security Conference in January 2007, Putin reminded his audience of the
promises made to Gorbachev in 1991 not to expand the Atlantic alliance and warned that further
attempts at enlargement (the Baltic states having been included in 2004) would imply great
risks. Yet NATO and the EU were inexorably pressing forward. At the Bucharest NATO summit in
April 2008 the Americans made the offer of NATO membership to Georgia and Ukraine, only to have
the offer vetoed by Germany and France. Possibly to force the issue, the pro-Western president
brought to power by the Rose Revolution in Georgia, Mikheil Saakashvili, armed and encouraged
by the US and Israel, later that year embarked on a military adventure to recapture the
breakaway province of South Ossetia. It ended in a complete debacle, as a Russian army stood
ready in North Ossetia to deal the invaders a major, if very costly, blow. This, then, was what
Richard Sakwa calls, 'the war to stop NATO enlargement'. From now on, every post-Soviet
republic tempted to join the Atlantic alliance would have to reckon with Russian protection for
groups resisting such integration, irrespective of whether it concerned actual Russians or any
other of the almost two hundred nationalities of the former USSR.
The EU-Russian Energy Equation and Ukraine
The gas from Russia that feeds Europe today was discovered back in the 1960s; the Friendship
oil pipeline was built in 1964 and the Soyuz, Urengoi and Yamal pipelines followed after West
Germany started purchasing Soviet gas. The link-up culminated in 1980 with the contract for a
gas pipeline from Urengoi in north Siberia to Bavaria, signed by a heavy-industry consortium
headed by Deutsche Bank.
After the collapse of the USSR, Russian gas had to pass through the pipeline grid of
independent Ukraine, which in the meantime had become the prey of rival clans of oligarchs. For
most of them, gas was the key source of rapid enrichment -- directly, as in the case of
subsequent prime minister Yuliya Timoshenko, 'the Gas Princess', or indirectly, by supplying
steel pipes for gas transport, as in the case of president Leonid Kuchma's son-in-law, Victor
Pinchuk, the 'Pipeline King'. The economic mismanagement and infighting of the different
oligarchic clans in Ukraine led to payment arrears and repeated shutdowns of the gas supply
from Russia, and Gazprom, the state-owned Russian gas company, early on began to look for ways
to bypass the Ukrainian grid.
After Putin had come to power, he disciplined the Russian oligarchs as part of the
restoration of state sovereignty. Mikhail Khodorkovsky, the energy oligarch and richest of all
Russian billionaires at the time, at the time was buying support in the Duma to build a
trans-Siberian pipeline to China; whilst negotiating with ExxonMobil and Chevron about US
participation in his Yukos concern, which he planned to merge with Sibneft into the world's
largest oil company. In 2005 he was convicted to a long prison sentence. Yukos was brought back
into the Russian patrimony via a proxy construction involving state-owned Rosneft and Gazprom,
as part of broader subordination of the economy to the state.
Gazprom meanwhile began building alliances to avoid future disruption of supplies via
Ukraine and secure its European market. In 2005 it agreed with the outgoing government of
Gerhard Schröder to build a pipeline across the Baltic directly to Germany, 'Nord Stream',
with a consortium of German companies. Schröder was made the chairman of the board of the
joint venture, Achimgaz, and two years later, a South Stream pipeline across the Black Sea to
Bulgaria was contracted with ENI of Italy. It was to be extended into south-eastern Europe as
far as Austria. In this way Gazprom and the Russian state were outmanoeuvring various EU
projects for pipelines aimed at by-passing Russia. Indeed it was the EU's plan to use a Nabucco
pipeline across Turkey to connect to the Caspian energy reserves that prompted the $40 billion
South Stream project. Romano Prodi, prime minister of Italy, who first discussed South Stream
with Putin in late 2006, was offered the chairmanship, which he declined, perhaps in the
knowledge the project would become highly contested.
The Eurasian connection by now posed a direct threat to the cohesion of the enlarged
Atlantic bloc. Besides Nord Stream and South Stream, Gazprom's collaboration with NIOC of Iran
and a joint venture with ENI in Libya set all alarm bells ringing in Washington. Already in May
2006, a few months after the gas shutdown to Ukraine, the US Senate unanimously adopted a
resolution calling on NATO to protect the energy security of its members and have it develop a
diversification strategy away from Russia. Senator Richard Lugar in a much-noted speech prior
to the NATO summit in Riga, Latvia, in November 2006, argued in favour of designating the
manipulation of the energy supply as a 'weapon' that can activate Article 5 of the NATO treaty
(common defence).
In a report to the European Parliament in 2008, the director of the EurasianPolicyCenter of
the Hudson Institute in the US recommended that the EU should assist in liberalising and
modernising the Ukrainian grid instead of supporting South Stream. Tension in the Black Sea
area, her report noted candidly, might serve the purpose of blocking that pipeline altogether.
However, after the 2010 election of president Victor Yanukovych, the front man of the powerful
eastern and southern oligarchs, the lease of Russia's Crimean naval base at Sebastopol, home of
its Black Sea fleet, had been extended to 2042, so the prospects for stirring up unrest there
were mitigated by Moscow's enduring naval preponderance.
Regime Change in Kiev
One aspect of the resurgence of a sovereign Russia was the plan for a Eurasian economic
union to rebuild relations with former Soviet republics (Ukraine obtained observer status early
on). The EU's Eastern Partnership was a direct response. It was offered to former Soviet
republics in 2008, in a gesture that signalled that Europe now effectively acted as a
subcontractor to the larger anti-Russian design drafted in Washington. Concretely, the EU
offered Ukraine and other former Soviet republics an Association Agreement that also included
provisions for the country's alignment on NATO security policy, besides a neoliberal make-over
in the spirit of the Krasner-Pascual doctrine. The envisaged reforms would be devastating for
the country's existing power structure, not least for the Donbass oligarchs whose front man was
Yanukovych. Their heavy industry assets would be swept away by EU competition, the country
turned into an agricultural supplier, and Russian gas cut off.
Hence, when both the EU and Russia sought to win over Yanukovych to join their respective
blocs and Brussels ruled out the triangular arrangement by which the Ukrainian president had
hoped to postpone the choice, he could not but step back from signing the EU Association
Agreement in November 2013 and accept a Russian counteroffer. By then, 'Europe' had become a
code word for an end to oligarchic rapaciousness, in which Yanukovych and his sons had become
involved as well. The president's decision triggered mass demonstrations and occupations, which
this time included an armed insurrection by Ukrainian ultra-nationalists in the historically
anti-Russian west of the country. It created the space for actual fascists to hijack the
protests and prepare a coup. By their use of deadly force at the Maidan central square
(ascribed by the coup plotters and in the West to the riot police), the Ukrainian ultras
demonstrated they were ready to kill their own compatriots to achieve their aims.
To prevent the situation from getting out of hand completely, the foreign ministers of
Germany, France and Poland flew to Kiev on 20 February 2014. However, whilst they negotiated a
deal with Yanukovych and the opposition, the US and other NATO ambassadors met with Andriy
Parubiy, the co-founder of the fascist party of Ukraine and former head of its militia,
Patriot of Ukraine . Parubiy, today the speaker of the Kiev parliament, was in command
of the armed gangs at the Maidan; two days later these took power in the capital, installing a
government of Ukrainian nationalist stripe, selected by US diplomats. Parubiy was appointed
secretary of the National Security and Defence Council (NSDC), a key post overseeing all
military and intelligence operations, which he continued to hold until three weeks after the
downing of MH17. With the Russian-Ukrainian half of the country effectively disenfranchised,
the coup was responded to by the secession of Crimea and an armed insurrection in the Donbass.
Stirrings of revolt in Odessa and Mariupol would be suppressed with deadly violence, in which
Parubiy and other far right figures were directly involved.
Confronting the BRICS in Ukraine
From late March onwards the war party in the United States and NATO began to elaborate a
strategy that would make Ukraine the testing ground for a trial of strength with Russia and
China. The secession of Crimea and its re-incorporation into the Russian Federation was
exploited to evoke the spectre of an impending Russian invasion on several fronts. General
Philip Breedlove, commander of US Eucom (European Command, one of nine regional US military
commands spanning the globe) and NATO Supreme Allied Commander Europe (Saceur), coordinated the
Western position with General Wesley Clark, a former NATO Saceur at the time of the Yugoslavia
wars. Clark was already advising Kiev forces in eastern Ukraine before the Donbass had actually
risen in revolt. On 12April he asked Breedlove whether the NATO commander could not arrange a
statement blaming Moscow for the violence because ' if the Ukrainians lose control of the
narrative , the Russians will see it as an open door'. Clark then elaborated on the
general geopolitical situation, giving further insights into why the war party in the US
believed that Ukraine was to be 'held' and chosen as a battle ground to confront Russia and
China. No time was wasted on market democracy here. Claiming that 'Putin has read US inaction
in Georgia and Syria as US "weakness",' Clark went on to explain that
China is watching closely. China will have four aircraft carriers and airspace dominance
in the Western Pacific within 5 years, if current trends continue. And if we let Ukraine
slide away, it definitely raises the risks of conflict in the Pacific. For, China will ask,
would the US then assert itself for Japan, Korea, Taiwan, the Philippines, the South China
Sea? If Russia takes Ukraine, Belarus will join the Eurasian Union, and, presto, the
Soviet Union (in another name) will be back. Neither the Baltics nor the Balkans will
easily resist the political disruptions empowered by a resurgent Russia. And what good is a
NATO "security guarantee" against internal subversion? And then the US will face a much
stronger Russia, a crumbling NATO, and [a] major challenge in the Western Pacific. Far
easier to [hold] the line now, in Ukraine than elsewhere, later .
On the weekend of 13 to 14 April, CIA Director John Brennan was in the Ukrainian
capital. The Anti-Terrorist Operation (ATO, so called because the use of military
force within the country is only warranted under that label) began right after Brennan's visit;
Parubiy sent out a Twitter message on the 15th that veterans of the Maidan uprising were
poised to join the fight. Since NATO had earlier implored Yanukovych not to use force
against (armed) demonstrators, Moscow now asked the alliance to restrain the coup leaders in
turn. But according to foreign minister Lavrov, the answer they got was that 'NATO would ask
them to use force proportionately'.
In fact even the oligarch, Petro Poroshenko, elected president on 25 May 2014 to provide a
veneer of legitimacy to the coup regime, proved unable to restrain the hardliners. On 30 June,
following a four-hour NSDC meeting with Parubiy, interior minister Avakov, and others whose
armed followers were demonstrating outside, Poroshenko declared that the ceasefire would be
lifted and a new offensive launched. Three days later NATO naval manoeuvres in the Black Sea
commenced with US participation and with electronic warfare a key component. On the ground,
Kiev's forces made rapid progress, apparently drawing a ring around the large rebel city of
Donetsk. NATO had its own concerns: an upcoming summit in Wales in September was expected to
capitalise on the trope of a 'Russian invasion', vital after the Afghanistan debacle, and
dovetailing with the emerging contest with the BRICS bloc.
The BRICS, coined first as a banker's gimmick, were never more than a loose collection of
'(re-) emerging economies', but from Washington's perspective, sovereign entities not
submitting to neoliberal global governance are unacceptable. So when on 16 July, the BRICS
heads of state, hosted by the Brazilian president, Dilma Rousseff (removed by a rightwing
conspiracy in May 2016), signed the statute establishing a New Development Bank, or BRICS bank,
as a direct challenge to the US and Western-dominated World Bank and IMF, the US imposed new
sanctions on Russia over Ukraine, specifically targeting the energy link with the EU. The
creation of an equivalent of the World Bank with a capital of $100 billion with a reserve
currency pool of the same size (an equivalent of the IMF), laid the groundwork of a contender
pole in the global political economy challenging the West's austerity regime frontally -- or so
it seemed at the time.
Still in Brazil before flying back to Moscow, Russian president Putin on the fringes of the
football world cup finals also agreed with German Chancellor Angela Merkel to pursue a
comprehensive Land for gas deal. Its tentative provisions included normalising the
status of Crimea in exchange for a massive economic rehabilitation plan and a gas price rebate
for Ukraine. However, a special European Council meeting convened on the 16th could not reach
agreement on whether the EU should follow the American lead this time, since countries with
export interests to Russia and dependent on its gas, were balking. Instead, the Council
stressed the EU's commitment 'to pursue trilateral talks on the conditions of gas supply from
the Russian Federation to Ukraine' in order to 'safeguard the security of supply and transit of
natural gas through Ukraine.'
The Downing of Flight MH17 and South Stream
The downing of MH17 on 17 July changed all that. As I said above, who did it and how
remains obscure, although there are several pursued by people familiar with local
circumstances, or revealed by insiders who know who which military assets were operating that
day -- but all that remains inconclusive. The official reports by the Dutch Safety Board and
the JIT may be conveniently dismissed although the DSB rightly pointed at the questionable
decision by Kiev to allow civilian planes to fly over a war zone. However, irrespective of the
actual perpetrator, and whether it was an intentional act or an accident, there is no doubt
about the West's intent to exploit the event to the maximum.
Former secretary of state and then-presidential hopeful Hillary Clinton in a TV interview on
the 18th called for making 'Russia pay the price' once its culpability had been established.
Her to-do list for the EU included, one, 'toughen sanctions'; two, find alternatives to
Gazprom, and third, 'do more in concert with us to support the Ukrainians'. The 'Land for gas'
negotiations were shelved and on the 22nd Europe dropped the remaining hesitations when it
underwrote the US sanctions targeting Russia's role as an energy supplier. As Mark Leonard,
founder and director of the European Council on Foreign Relations, noted in a newspaper
interview a year later, 'without MH17 it would have been pretty difficult to find
sufficient support for the increased sanctions on the Russian economy' .
In 2009 the EU had introduced a new energy policy, dubbed a 'Third Energy Package'. It does
not permit gas to be transported to the EU by the company producing it, effectively forcing
Gazprom to sell even the gas piped through the Ukrainian grid to other companies before it
could enter the EU. Nord Stream had still been exempted from EU competition rules, but the
projected South Stream was not, never mind that most contracts with Gazprom had been signed
before the Third Energy Package came into force. Even at the time of the Kiev coup,
commentators wondered to what extent shale gas from the US might be used to offset Russian
deliveries. LNG facilities planned in Florida and Maryland were projected to serve the European
market at Gazprom's expense, a prospect meanwhile far more realistic.
The Crimean secession and incorporation into the Russian Federation obviously played its own
role here. Crimea is a historically Russian region; having been assigned to Ukraine by a whim
of Soviet party leader Khrushchev in 1954, it never reconciled itself to being part of an
independent Ukraine. After the nationalist coup in late February, the status of the Russian
naval base in Sebastopol was in the balance. In 1991, the Black Sea had been a Soviet/bloc
inland sea, with one NATO country (Turkey) bordering it. Now there were two more NATO/EU
countries and two pro-Western, aspiring NATO members on its littoral. So when one week after
the coup, three former Ukrainian Presidents, Kravchuk, Kuchma, and Yushchenko, called on the
coup government in Kiev to cancel the agreement under which the lease of Sebastopol, home to
the Russian Black Sea fleet, had been extended to 2042, the question of who would be able to
project naval power over the Black Sea became acute. The question now was whether Russia would
be able to provide cover for a large-scale project such as South Stream, or not.
South Stream itself came into the firing line directly. The European Parliament, which never
raised the issue of why the February agreement with Yanukovych the EU brokered had been
sidelined by the coup, on 17 April 2014 adopted a non-binding resolution opposing the South
Stream gas pipeline and recommended a search for alternative sources of gas. On 28 April, the
United States imposed a ban on business transactions within its territory on seven Russian
officials, including Igor Sechin, the CEO of Rosneft, the Russian state oil company, as well as
Gennady Timchenko, whose Volga Group controls Stroytransgaz, the company entrusted with
building the Bulgarian section of South Stream. Nevertheless the Bulgarian parliament approved
South Stream two weeks after the reincorporation of Crimea, circumventing the EU's anti-trust
legislation by renaming the pipeline a 'sea-land connection'.The European Commission then
instructed Bulgaria to stop work on South Stream and proceeded to cut off tens of millions of
much-needed regional development funds, whilst the US ambassador warned Bulgarian companies
against working with Timchenko. A final visit of US Senators John McCain and Ron Johnson, in
combination with other punitive measures then led to the cancellation in early June. As Eric
Draitser commented at the time, 'South Stream has become one of the primary battlegrounds in
the economic war that the West is waging against Russia'.
The downing of Flight MH17 also definitively sealed the fate of South Stream. Russian
banks financing the project, led by Gazprombank, were hit by new sanctions, so that the
necessary capital could no longer be raised internationally. Putin earlier had hinted at
moving the transit of gas for the EU to non-European countries; in August, it was reported
there was a Plan B in the works to export via Turkey. On 1 December 2014, during a state visit
to Ankara, the Russian president announced that in light of Western sanctions and the refusal
of construction permits in the EU, South Stream would be replaced by a 'Turkish Stream'
pipeline, besides the existing Blue Stream link. However, in November 2015, a Turkish F-16 shot
down a Russian fighter jet over northern Syria, throwing relations between Moscow and Ankara
into a deep crisis and entailing the cancellation of Turkish Stream. This was only overcome
after the July 2016 coup attempt against Erdoğan, in which Russia sided with the Turkish
president, possibly even warning him in advance. Since the F-16 that shot down the Russian
jet was part of a pro-NATO unit based at Inçirlik airbase that took part in the coup
attempt, the incident over Syria would appear to fit in a framework that may also have decided
the fate of Flight MH17: a provocation to throw relations with Russia into disarray, but we
don't know for sure.
Regime Change in Moscow?
The MH17 disaster occurred in the context of a deep crisis, in which capitalist discipline
as imposed from its historic epicentre in the West, has become primarily predatory, relying to
an ever-greater extent on violence. Speculative financial operations in combination with the
'War on Terror' have spread economic risk and repression at home, war and regime change abroad.
Human survival itself has been turned into a global gamble played out over the head of the
affected populations for private gain. The West, led by the effectively bankrupt United States,
increasingly relies on force to sabotage the formation of any alternative, something its own
social formation can no longer bring forth. Even the most promising, potentially revolutionary
IT and media developments coming out of Silicon Valley have been mortgaged by a planetary
project of communications surveillance to safeguard US imperial positions.
Back in the 1980s, when it launched the second Cold War, the Reagan administration intended
to destabilise the Soviet bloc and bring about regime change in Moscow. This is also the aim of
the current, new Cold War. A 2015 Chatham House report, 'The Russian Challenge', discusses this
in some detail. Although it concedes that the West cannot have an interest in Russia sliding
into complete anarchy, neither should the Putin presidency be protected 'against change,
whether managed or violent '. Therefore, 'whether Putin was ousted by an internal
coup, by illness or by popular unrest , it would nevertheless be sensible for the West to give
further thought to how it might deal with the consequences of regime change in Russia.'
Effective communication with the Russian people and the defence of human values beforehand
would be essential for Western credibility Planning for the future ought, lastly, to
cover the scenarios from changes of leadership within the current structures, to the
emergence of a group ready to pursue structural reform in some sort of accountable dialogue
with the Russian population, to regime collapse .
The president of the National Endowment for Democracy, Carl Gershman, in a piece for the
Washington Post in October 2016 suggested launching a new, sustained anti-Putin
campaign, for which the contract killing of the journalist, Anna Politkovskaya, ten years
earlier, might be used as a vignette.
For such a campaign, George Soros' Open Society Foundation can be trusted to have elaborated
the 'civil society'/colour revolution scenarios, whilst identifying the groups that might be
mobilised for their execution. The OSF plan of action for 2014-17, titled Russia Project
Strategy , identifies Russian intellectuals active in Western academic and opinion
networks, the Russian gay movement, and others as potential levers for civil society protest
against the conservative bloc in power in Moscow. From the OSF documents hacked by the
CyberBerkut collective, Alexei Navalny's Anti-Corruption Foundation emerges as the key
beneficiary, and discussion portals and liberal media such as Echo of Moscow radio
station, RBK news agency, and the newspaper Vedomosti, as the preferred
channels to disseminate content.
There is no need to repeat that all this is part a powerful offensive to derail the loose
contender bloc around China and Russia, which had constituted itself in the face of Western
aggressiveness and crisis. The seizure of power in Ukraine as well as the secession of Crimea
and the civil war in the east, which has meanwhile cost the lives of more than 13,000 people
and displaced a million, as well as economic warfare against Russia by the US and the EU, have
brought the danger of a large European war several steps closer. Whether the actual downing of
Flight MH17 was an intentional, premeditated act or an accident, whether it involved a jet
attack, an anti-aircraft missile, or both, ultimately cannot be established with certainty. Yet
both the NATO war party and the coup regime in Kiev, which on many occasions has demonstrated
that its ultra-nationalist and fascist antecedents are very much alive, would have been
perfectly capable of such an act and had the means for it. Most importantly, they had the
motive. Those in power in Kiev had several times already attempted to draw Moscow into the
civil war, directly and through a NATO intervention. If this indeed was their aim, it would
also have served the Atlantic bloc's determined and long-standing commitment to force
continental Europe into an antagonistic relation with Russia.
In the current global conjuncture, even the tentative contender coalition combining the
Eurasian Union, the BRICS and the Shanghai Cooperation Organisation, constitutes an acute
danger to a capitalist West in crisis. Whether the United States and NATO would therefore also
be willing to take even greater risks than they are doing now is a prospect too frightening to
contemplate. However, it must be confronted, or the fate of the 298 people on Flight MH17 may
become that of humanity at large.
Kees van der Pijl is a Fellow, Centre for Global Political Economy and Professor
Emeritus of the School of Global Studies at the University of Sussex.
With the US and China contemplating their next moves in what is now
officially a trade war, a parallel narrative is developing in the world of energy where Asian
oil refiners are racing to secure crude supplies in anticipation of an escalating trade war
between the US and China, even as Trump demands all US allies cut Iran oil exports to zero by
November 4 following sanctions aimed at shutting the country out of oil markets.
Concerned that the situation will deteriorate before it gets better, Asian refiners are
moving swiftly to secure supplies with South Korea leading the way. Under pressure from
Washington, Seoul has already halted all orders of Iranian oil, according to sources, even as
it braces from spillover effects from the U.S.-China tit-for-tat on trade.
"As South Korea's economy heavily relies on trade, it won't be good for South Korea if the
global economic slowdown happens because of a trade dispute between U.S and China," said Lee
Dal-seok, senior researcher at the Korea Energy Economic Institute (KEEI).
Meanwhile, Chinese state media has unleashed a
full-on propaganda blitzkrieg , slamming Trump's government as a "gang of hoodlums", with
officials vowing retaliation, while the chairman of Sinochem just become China's official
leader of the anti-Trump resistance, quoting Michelle Obama's famous slogan "
when they go low, we go high. " Standing in the line of fire are U.S. crude supplies to
China, which have surged from virtually zero before 2017 to 400,000 barrels per day (bpd) in
July.
Representing a modest 5% of China's overall crude imports, these supplies are worth $1
billion a month at current prices - a figure that seems certain to fall should a duty be
implemented . While U.S. crude oil is not on the list of 545 products the Chinese government
has said it would immediately retaliate with in response to American duties, China has
threatened a 25% duty on imports of U.S. crude which is listed as a U.S. product that will
receive an import tariff at an unspecified later date.
And amid an escalating tit-for-tat war between Trump and Xi in which neither leader is even
remotely close to crying uncle, industry participants expect the tariff to be levied, a move
which would make future purchases of US oil uneconomical for Chinese importers.
"The Chinese have to do the tit-for-tat, they have to retaliate ," said John Driscoll,
director of consultancy JTD Energy, adding that cutting U.S. crude imports was a means "of
retaliating (against) the U.S. in a very substantial way".
In an alarming sign for Washington, and a welcome development for Iran, some locals have
decided not to see which way the dice may fall.
According to
Japan Times , in a harbinger of what's to come, an executive from China's Dongming
Petrochemical Group, an independent refiner from Shandong province, said his refinery had
already cancelled U.S. crude orders .
"We expect the Chinese government to impose tariffs on (U.S.) crude," the unnamed executive
said. " We will switch to either Middle East or West African supplies ," he said.
Driscoll said China may even replace American oil with crude from Iran. " They (Chinese
importers) are not going to be intimidated, or swayed by U.S. sanctions."
Oil consultancy FGE agrees, noting that China is unlikely to heed President Trump's warning
to stop buying oil from Iran. While as much as 2.3 million barrels a day of crude from the
Persian Gulf state at risk per Trump's sanctions, the White House has yet to get responses from
China, while
India or
Turkey have already hinted they would defy Trump and keep importing Iranian oil. Together
three three nations make up about 60 percent of the Persian Gulf state's exports.
Under pressure from Washington, Seoul has already halted all orders of Iranian oil,
according to sources, even as it braces from spillover effects from the U.S.-China
tit-for-tat on trade.
Expecting SA to help supply the World's needs is perhaps going off the deep end. It's their
bread and butter for years to come. As years pass, they become more aware that those years
are limited. This is not the 1970's, it's 2018. They will supply what is profitable for them,
and wasting it early, doesn't sound real smart, does it? If we offered them massive support
to develop their nuclear capabilities, it would probably entice them. Or, jump out of the
pot, and into the frying pan. Iran May have more capacity for new oil.
If I have understood this correctly. When most of their fields are mature, the option they
have is to invest (almost overbuild) in facilities foremost to treat and inject the steadily
higher volume of water to keep oil production steady and at the same time overinvest in
infill drilling to keep the volume rising. All this to sustain or even increase oil output
from mature fields, so that the oil price can stay low. And then there is the extra gain in
extra barrels to consider as a result of the investments that adds to ultimate recovery at
each field. The gain from extra barrels could make up for a mediocre return on investment in
some cases and a questionable one in other cases. Given a relatively low oil price
assumption.
Why would they do that? Keeping the facilities as they are for mature fields, accepting
only small investments where they are highly profitable, limiting infill drilling to the best
locations, let the oil production fall and hope for prices to rise would be a superior
solution for them, would it not? Why rush investments in mature oil fields?
When most of their fields are mature, the option they have is to invest (almost overbuild)
in facilities foremost to treat and inject the steadily higher volume of water to keep oil
production steady and at the same time overinvest in infill drilling to keep the volume
rising. All this to sustain or even increase oil output from mature fields,
Well no, it does not usually increase production, it just drastically reduces the decline
rate. For instance, a very mature field may have a natural decline rate of 6 to 8% per year.
With infill drilling of horizontal wells along the top of the reservoir, they may reduce that
decline rate to 2% per year.
so that the oil price can stay low.
No, that's not why they are doing it. They are doing it to maintain their annual
production. Some do increase production but with oil from new fields. These new fields,
however, will have a much lower URR and will start to decline after only a few years. All the
giant and supergiant field have already been discovered.
The "so that the oil price can stay low" was a well hidden irony from my part. But you
have a point, they want to keep their long term customers supplied, not losing face in OPEC
and their long term allies happy. They stretch to keep everyone happy.
Russia is certainly being creamed. The massive infill is visible from satellites and they
haven't found/opened anything new of size, yet have outlasted what everyone (including them)
calculated would be the start of their decline.
Russia needs the oil revenue badly. But is their ultimate decline going to look like
China? Very likely.
2018-07-05 (Platts) While Saudi Aramco CEO Amin Nasser told Platts recently that "maximum
sustainable production" was 12 million b/d, industry experts believe Saudi Arabia will
struggle to pump more than 1 million b/d of additional output.
Yeah, I think that is pretty much what Ron and George have been saying. It is why all these
drops in production, and projected production that will not get out of the ground has to
cause demand to exceed supply within the next year by a substantial amount. Throw in Iran's
sabre rattling over the Homez, and oil prices should be through the roof. That it is not, is
mainly complacency built up over the past four years from the inventory overage. As Scarlet
O'Hara said, "After all tomorrow is another day".
MSNBC announced that the Aramco IPO may never happen. MSNBC didn't say why, however I suppose
those reserves that the Saudis have touted for so long could be very difficult to have
verified based on SEC rules. I think that much of the last two years of prep for their IPO
has been shopping for a exchange that would allow them to get their stock issued without
drastically revising their prior reserve disclosures.
You can also look at this development as an indication that the above discussed "rock" may
have already dropped.
I think that the potential threat of what happens if there is a hot war are more extensive
than just having the Strait of Hormuz being closed. If you look at that map you can see that
Saudi Arabia is just across the Strait. And as luck would have it, Saudi Arabia's oil fields
are mostly in the east which means that they are within close missile range of Iran. Nice oil
fields you have there Saudi Arabia. Shame if something happened to it. The United Arab
Emirates are also within missile range as well. If both countries think that Patriot
batteries will protect them then they must have been disillusioned to find that those
Patriots couldn't even defend against wonky Houthi missiles.
Then there is the fact that Iran shares a border with Pakistan and Afghanistan. Remember how
the CIA shipped all those anti-tank guided missiles (ATGM) and ManPads to the Syrian
Jihadists via countries like Saudi Arabia? Be a real shame if captured stock got passed on to
the Taliban via all those borders and started targeted US/Coalition forces in Afghanistan.
Just these two possibilities show how Iran has a whole range of options to use if it came to
a military confrontation. And it should be remembered. If a US/Coalition could not
successfully occupy Iraq with a population of 37 million, then how can Iran with a population
of 80 million be occupied?
Another factor is that even if a US/Coalition managed to somehow suppress all those missiles
the Iranians are using to guard those Straits, you would never be sure that you got them all.
Who really want to risk their oil tankers going down those Straits and wanting to risk that
bottleneck beig turned into a flaming sea? The trouble there is no way that there would be a
quick campaign possible with everybody home by Christmas. This has the potential of still
being fought during the 2020 US elections and I do not think that the US establishment wants
to risk that one. What they do want is to strangle Iran economically and turn the place into
one of grinding poverty but if pushed too far may go the Sampson option.
Local kids could also be trained to fire rockets across the water. The straits are not
straight and cut into Iran, so there's a good vantage point for Iran.
> probably already is.
>> China is still officially stating that it will not end its Iranian oil imports and
operations.
China's investment of billions into the deep port of Gwadar should not be discounted.
While China has ceded the ocean surface to the US navy, the wei qi way is to surround and not
engage directly. By now the Gulf of Oman should be a sensory organ for information critical
to Iran, and passive systems are much harder to detect & destroy.
We're now three years out from Qiao Liang saying China "thinks that Washington will not
fight Beijing for the next ten years". China doesn't want the fight (and I mean high
explosives, not 'fighting for') yet, but they've been preparing. And let us not forget the
rooster tails on the American fleet fleeing the Persian Gulf in October 2015 when Russia
launched cruise missiles at Syria. That was three months after the 'One Belt, One Road'
speech.
While the Saud's are working out their family disputes they cannot afford to have the
petrodollar disabled. But the US is materially capable of weathering energy disruptions
better than the EU, which would become even more dependent on Russia. Long term, the
petrodollar is gone and climate migrations are coming, so the when of Fortess America could
depend on relative and not absolute 'cui bono, ciu malo'.
tldr: the fight is inevitable, there's more than two in the ring, and there's no
referee.
I doubt if it is mined at this time, but mines would be a logical way to quickly shut the
Strait down. A couple of small fast ships dropping mines at night could shut it down very
quickly. They could drop mines along the far shore which would force ships towards the Iran
side where they would be vulnerable to shore-based anti-ship missiles.
BTW, the standing NATO minesweeping group is three ships (two Lithuanian and one British).
Historically minesweeping is one of the roles carried out by other countries that the US is
currently working hard to alienate. https://en.wikipedia.org/wiki/Standing_NATO_Mine_Countermeasures_Group_1
Mine sweeping ships generally are not heavily armored to avoid magnetic and acoustic
signatures that can trigger mines. So they can struggle in contested waters and would be very
vulnerable to anti-ship missiles.
"Rouhani, considered by European politicians to be a reformist, appears to be showing a
hardline streak that is nearer the strategy of the country's supreme leader, Ayatollah
Khamenei. "
Everybody becomes a hardliner when faced with an existential threat, which Trump's threats
are now creating for Iran.
There's no need to sink any oil tankers to stop all oil shipping. Those tankers don't sail
without full insurance for the cargo, and no maritime insurer will back shipping through the
Strait of Hormuz while the Iranians are on the warpath. Hence, no oil tanker.
That is why a few mines would be very effective. All oil shipping would cease immediately.
Because mines can be redeployed very easily, including by air or fishing boats, insurers
would probably not be assuaged by naval assurances that mines have been swept.
In the 1980's when the Iranians mined the Straits the tankers still moved. What was the
insurance deal then? Did it the US pick it up for that part of the trip?
"If a US/Coalition could not successfully occupy Iraq with a population of 37 million,
then how can Iran with a population of 80 million be occupied?"
Iran is also mostly Persian. Yes, there are Arabs, Armenians, Baluchis, etc., but the vast
majority are Persian and are proud to be Persian. Unlike Iraq, where you have a country with
3 groups you can play off each other.
I visited Iran over 5 years ago and was able to speak to some regular Iranians (English is
not uncommon amongst men and women). They will fight to the last man, woman, and child if
anyone came into their country. And that's what the secular ones who hate their government
say.
Every town has lamppost flags showing the pictures of all the young men who died in the
Iran-Iraq War. It was humbling to see the generational devastation wrought on that country.
Even the youth view that war as a world war, since people from over 25 countries were found
to be fighting on the Iraq side ( https://en.wikipedia.org/wiki/Iran%E2%80%93Iraq_War
– Remember the Soviet Union was ALSO on Iraq's side!). They faced destruction and
survived. They view themselves as an ancient, sophisticated people as well as the greatest
survivors in the world (all with good reason as they are an amazing people with a rubbish
government).
I do not see this ending well if the US thinks they can put the Iranians into a corner and
get compliance. It is an amazingly ahistorical understanding of the geopolitics of Iran.
These are the people we should be allying with not Saudi Arabia. But this is the same group
who think blundering into Iraq or Syria was a good idea, so I really can't be surprised.
Just to add that the people living above the main Saudi oil fields, Eastern Province, are
mainly Shiites. Shiites are also to be found in the south along the ill defined border with
Yemen. Both communities are disaffected and have been for decades, although the BBC, which
advertises its "unparalled global expertise" (sic) between news bulletins and other
programmes, reckons the Arab Spring caused the restiveness in Saudi Arabia.
This said, the Saudis and their Pakistani poodles can foment (Sunni) Arab and Baluch
disorder in Khuzestan and Sistan / Iranian Baluchistan.
I always wonder to myself when, on the BBC News Channel, they pan across the alleged
newsroom in New Broadcasting House and you see all those desks -- rows upon rows of them --
where people are sat, or, occasionally, get up and have a wander around, what the heck are
they doing there? It can't be producing news reports because you see the same half a dozen
so-called news "stories" stripped endlessly across the schedule throughout the day.
Every so often we get "business" news, which is someone from a spread betting company
piffling on about some rot or other then "a look at the markets", not, unfortunately, a view
of Covenant Garden or something, that would be more interesting, but rather some mysterious
figures from world indices and forex rates splayed across the screen like some inscrutable
hieroglyphs.
Then a bit of sport, with a dash of added jingoism.
Finally, some rally round the flag update on "the forces" with some top brass on the poop
deck of an aircraft carrier looking for an F35 ("F35 coming real soon"). Maybe Sophie
Rayworth in a tank.
Or alternatively it's Jenny Hill from Berlin with something about sausages and Merkel with
stock footage of people drinking beer from unfeasibly large glasses wraps it all up apart
from a sky diving granny then the weather.
It could be worse. We all could work in one of these places. It would not matter how great
a story you found, it would all have to get through the editors who report directly to their
owners like with the Murdoch press. The stuff you talk about is just the stuff that gets the
editorial nod i.e. pure pap.
Some of the stuff that I have seen on Australian TV, however, is nothing less than out and
out propaganda. I watch some of this stuff and I compare it with what I read on this site or
what a commentator chips in with and I wonder what these newsreaders actually are thinking as
they read some of these stories. Probably their steady pay packets.
I wish to god I knew. I have seen this creeping in the past decade or more. I suspect that
a lot of bad practices are imported from overseas. There are international conferences for
conservative political parties so you would have American Republicans, British Conservatives,
Australian Coalition, etc. all mixing together and swapping idea and techniques. They even
work together when there is an election in their country.
Just the other day I heard one Coalition member describe another as a "patriot" which you
NEVER hear in Oz. Kinda like a Republican describing another Republican as a good Communist.
You just never hear it. We even have an ex-Prime Minister that sounds like he could be a good
buddy to Mark Rubio running around trying to blow up his own party (currently in power)
saying that we should build as many coal power stations as possible because climate change is
not real.
Historically our governments have been ruled by pragmatism and past US governments have
labelled us as "socialist" due to adopting such things as single-payer health. The past few
years I am noting more and more ideologues going into politics who want to drag the country
into their way of thinking whether it is to pick fights with China (our major trade partner)
or send the Australian military to the ends of the earth as if they were Mercenaries-r-us.
The times they are a changing.
It all reminds me of C S Lewis' description of H -- as a giant bureaucracy. "The Screwtape
Letters" were written at the end of WW-2 and still come across as 'fresh.'
Supposedly the KSA funded development of the Pakistani bomb. There probably is some
agreement to hand some over (if it hasn't already been done) for "existential threats" This
could turn very bad very fast.
Iran has lots of options. Their Navy wouldn't last very long in a hot war but they have
lots of asymetric options. They have reverse engineered Russian torpedoes and these could be
launched from land or from mini-subs in shallow waters (where they are far harder to detect),
making life very difficult for opponents, let alone tankers. They can strike the UAE and much
of Saudi Arabia using a wide variety of ballistic missiles. To prevent this, the US would
have to strike Iranian territory, and this would cause a massive escalation. In almost any
scenario, the Straits would be shut down for many months, and this would be catastrophic for
the world economy. Asia would come off worse as they are most dependent on LNG and oil from
that region.
As you say, the great 'unsaid' is the Taliban. If Iran decided it was in their interest to
supply them with a few dozen trained operators with a few thousand anti-tank missiles and
manpads, then its goodbye Kabul.
The Iranians hate the Taliban and Al Quaeda and ISIS a lot more than we do since we are on
Saudi Arabia's side. They also seem to follow their principles. Don't forget our allies and
proxies in Syria are the headcutters and madmen ..all Sunnis ..although our government does
not want to admit it. They would be a lot smarter to trigger a Shiite uprising in Saudi
Arabia and shut the country down. The Shiites in Saudi are downtrodden and abused.
To escalate a carrier sinking to nuclear war is, I believe a lose/lose proposition. Let
say the Iranians sunk a carrier and the US Nuked Tehran.
The Iranians would not be in a forgiving mood at that point, and it would do little to
remove the somewhat irritated Iranians along the northern side of the Persian Gulf. The
irritated Iranians would initiate incidents over the impact of irradiated Iranians.
The US could nuke the Iranian Coast along the Persian Gulf, but, the gulf is not wide, and
the result would be poor prospects for the US allies on the South side of the Gulf. In
addition one does not know if nuking Shea would provoke a Sunni backlash against "the
infidels, the Christian US."
One could argue that Christians and Nukes cannot be mentioned in the same sentence.
The Prologue of Robert Baer's "Sleeping With the Devil" outlines a potential scenario of a
Shiite attack on the eastern Saudi oil fields. The sub-title is The Doomsday Scenario.
The book is about the US-Saudi relationship by a retired CIA officer. A very good read and
part of trying to understand this entire mess.
Exactly right. Logic dictates that if Iran is attacked, Iranian missiles will soon
thereafter attempt to destroy all of the oil producing capacity selling to Europe, Japan and
the US within range of its missiles. This means ships, oil fields, pipeline, ect. Oil prices
would skyrocket, plunging the US, Japan and Europe into a deep economic downturn.
Why people ignore the outcome you provided is beyond me. If I were Iran, I'd do the same
if Israel attacked too.
Your guess is that nobody will attack the Iranians after they attack the shipping to close
the straits?
In the 1987 Iran attacked about 91 ships in the Gulf. The oil still flowed. On April 18,
1988 the US attacked and severely damaged a number of Iranian ships and bases. After that
things started winding down. Then on July 3, 1988 the US shot down that Iranian airliner.
Then things really quieted down.
What are the differences now? Iran: ballistic missiles and subs?
There's Lt. General Riper, who played the Iranian side in the 2002 Millennium Challenge war
games, "killing" 20,000 Navy personnel and "sinking" 16 American warships
on the first day, so he knows better than to even start such a bottlenecked battle.
There's always General Farnsworth, the great grandson of Colonel Armstrong Custer.
Farnsworth has worked for two decades in the Purchasing & Planning wing of the Pentagon
-- three levels below daylight -- but his confidence in an immediate American victory Over
There is indubitable.
In similar vein, MI5's Eliza Manningham Buller is a descendant of Redvers Buller, British
commander in the second Boer War, but much more of a realist and moderate.
Redvers Buller? Seriously? I have read a lot about his role in the Zulu War of 1879.
Intriguing character being hard-fighting and hard-drinking and yet refused to wear his 1860
China medal on the grounds that it was an unnecessary war. And a descendant of his is head of
MI5?
Here's a little character sketch of Redvers Buller, from " On the Psychology of
Military Incompetence ", by Norman Dixon:
The leading character was the commander-in-chief, General Sir Redvers Buller. According
to a contemporary description there could be no finer choice for our South African
adventure: 'There is no stronger commander in the British Army than this remote, almost
grimly resolute, completely independent, utterly fearless, steadfast and vigorous man.
Big-boned, square-jawed, strong-minded, strong-headed Smartness sagacity administrative
capacity He was born to be a soldier of the very best English type, needless to say the
best type of all.
Unfortunately this assessment was at variance with the facts in all but two particulars.
Firstly, he was indeed big. Secondly, though sadly lacking in moral courage, he was
undoubtedly brave when it came to physical danger. In this respect, as in many others, he
was not unlike Raglan of the Crimean War, and indeed some other commanders of subsequent
years.
Of Sir 'Reverse' Buller, as he came to be known by his troops, Rayne Kruger writes: 'At the
risk of marring [the] contemporary description it should be mentioned that his big bones
were particularly well covered, especially in the region of the stomach, and that his
square jaw was not especially apparent above a double chin. He had entered the army with no
disadvantage, his mother being a Howard and niece of the Duke of Norfolk, and he was very
wealthy, which was fortunate in view of his preference for a diet of ample good food and
champagne.
Such examples of the Peter Principle, wherein people are raised to their own level of
inefficiency, was never better illustrated than in the case of Sir Redvers Buller, who has
been described as 'a superb major, a mediocre colonel and an abysmal general'. In this
case, high-level military incompetence must be laid at the door of heroic leadership, for
this was the quality which eventually put him where he could do the most damage to his own
side.
The US response will be that this unprovoked aggression is an act of war, etc. This
ignores our own unprovoked act of aggression, the embargo.
In case any has forgotten, those dastardly Imperialist Japanese launched an "unprovoked"
attack on Pearl Harbor because the US put Japan under an embargo.
Embargoes themselves are not acts of war, but blockades are. But this is all technical
blather. The US is attempting to strangle Iran. Iran will attempt to strangle the Gulf Arabs
and the US. If Iran starts firing missiles or blockading the straits, the US will attack
Iran. Iran will in turn launch attacks on the Gulf states. This could drive oil over $200,
perhaps higher.
If Iran were clever, they would institute some sort of quarantine or inspection in their
territorial waters. Indeed, they should claim jurisdiction over the entire strait in the
interest of international security (they could certainly find some US document somewhere and
just change the names). Then they could stop every ship going in and out and spend a week or
so inspecting each one for contraband, disease, etc. This would not be an act of war but
would certainly provoke the US into striking first anyway.
Iran has already extended its territorial waters to 12 miles, as did Oman. Given that the
strait is 29 miles at the narrowest, and that to deal with the amount of shipping, pretty
much all of it passes through either Omani or Iranian territorial waters. Technically,
Iran/Oman has right to stop any non "innocent" (read unarmed) shipping trough it territorial
waters. Not sure what is Omani relationship with the US/Saudis at the moment, wasn't paying
much attention to the Gulf.
Once the US decides to strike first, we're going to be on our own. The Saudis will be
completely useless as they always were, understandably not wanting to be cannon fodder for US
interests. And with most of Europe and Asia relying on gulf oil, our 'coalition of the
willing' is going to be a bit shy of members.
But $200 a barrel and the US a solid producer? Seems to be some win-win money to be made for
both Raytheon and Exxon-Mobil.
No Saudi just like no rich American will give his life for his country .in the military.
Life is just too good for them .why fight in the desert when you can cool it at a cafe in
Munich ..why are all the Syrian men of fighting age in Munich and Hamburg? They don't want to
fight for their country.
Considering the restraint Iran has shown regarding Israeli attacks in Syria, it's safe to
assume they want to avoid war at all cost. Don't expect any acts of aggression from them.
Talk of closing the strait is trying to see if there is any spark of independence left in
Europe's political elite. Unfortunately the Europeans only care about money – what they
get personally from the US to run their countries and what their corporations get from doing
business with America. There just isn't enough business between Iran and Europe to offset
that. Now the more unreasonable Washington becomes the more uncomfortable its allies become,
however they will still hold their noses and answer the call to duty. I'm afraid Iran's
courting Europe will produce little to help them. Luckily China and Russia, even Turkey and
India, are far more important.
The nice thing for Iran's hardliners – assuming the MSM narrative that they are
nasty terrorists always looking to cause trouble – is that they don't need to take
aggressive action to start a war. They've got America/Israel and that's the cause of every
war in the 21st century. That pairing will decide if and when there is to be a war. Russia
and China might have the ability to provoke caution but Iran doesn't.
Do not expect any actions from the Iranians to provoke a war. It's a war they cannot win
and they know it. it's also a war they can't lose but the price they could pay by surviving
might be really horrific. I'm not sure they'd close the strait even in a shooting war because
that would risk further escalation. The moment America starts bombing Iran the law of
diminishing return kicks in. The US will be looking for any excuse to go nuclear. Therefore I
doubt Iranian resistance will be more than defensive. Hopefully Russia is providing them with
air defences to be able to shoot down some US planes. Just lay low and ride out the storm.
That's been the philosophy of US/Israeli opponents in the Middle East this decade. It's why
the Russians take so much crap and keep turning the other cheek. They understand that either
they lose such a war or, if they are winning they risk the US going nuclear. Iran can't win a
war with America. Iran, however, can inflict unacceptable casualties but then they run the
same risk of Washington going nuclear in retaliation. In Asian capitals you have rational
players who understand that a nuclear war must be avoided if possible. Thus they avoid any
aggressive actions which they fear could lead to such a war. The problem humanity has is that
we're not sure if there are any rational players in Washington or Tel Aviv.
"The problem humanity has is that we're not sure if there are any rational players in
Washington or Tel Aviv."
+1
Given our belief in being an "exceptional nation" hasn't this been humanity's problem since
the end of WW2?
Will the sanctions pull Iran enough to such an escalation? Would other countries (apart
from Turkey) thing that this is troubling enough to risk US sanctions and disobey? There has
been an escalation in language between the UE and US regarding Iran sanctions but it is still
too soon to know what will be the EU position. We migth know after tomorrow's meeting in
Vienna. I don't know what could happen but be sure the US is running out of "natural allies"
by stepping up too much it's support for Saudi Arab. Trump is inaugurating a new era and it
doesn't look pretty.
The Army might be in trouble but the Marine Corps WILL BE IN A HURT LOCKER FROM HELL if
its ever called on to face Russian forces if they follow thru with published planning.
It is as clear as day that President Trump is obsessed with regime change in Iran. What is
not made clear is how much his gambit is damaging to Americans and American interests.
Without cause or justification, Mr. Trump pulled out of the Joint Comprehensive Plan Of
Action (JCPOA), striking a hard blow to America's European allies – and its own
credibility. Moreover, he threatened European countries with secondary sanctions should they
continue to trade with Iran.
To top it all, in his latest move, he has called for all Iranian oil exports to be cut off
by November. Or in practical terms, he is imposing an economic blockade on Iran. This is a
similar scenario that was played out by the British in 1951 against Iran and Dr. Mossadegh
– who was later overthrown in the 1953 British-US coup. But today, the IR of Iran is not
the Iran of 1953, and the brunt of American demands and actions will not be borne by Iran
alone.
Demanding that no country purchase oil from Iran is in fact an economic blockade. It is an
illegitimate use of power to force a sovereign nation to surrender. It must be made clear
however, that it is not just Iran that is the target here. The Trump administration's demands
arean offensiveexercise of extraterritorial authority with no regard for sovereign equality
between states. All states involved in trade with Iran will either have to cower to his demands
or be punished.
But there is more than state sovereignty and indignation that is involved. These actions
will have a dire effect on the economy of allies, and they will hit Americans in the wallet
– hard. If Mr. Trump is giving a November deadline, he hopes to postpone the impact this
will have on the November elections. He wants total rule over America before totally
bankrupting it.
To fully appreciate how Mr. Trump intends to make 'America great again' where his policy
regarding Iranian oil is concerned, one must take a look at some numbers and empirical
evidence.
The oil strikes leading up to the toppling of Iran's Shah were felt around the world. During
the 1978-79 revolution, Iranian oil production dropped 3.8 million barrels per day for 3
months. Although outside production increased by 1.8 million barrels to make up for the loss,
the net loss to the world was 150 million barrels of oil. However, the compounding results of
the production loss were significant around the globe.
Many Americans may recall the lines at the fuel pumps, but that was just what met the eyes.
The increase in oil prices impacted farming, production, transportation of goods and services,
and so on. At that time, China, currently the second biggest oil consumer behind America, was a
net exporter of oil. The loss to U.S. economy was estimated at many billions of dollars in 1979
and 1980 (Deese and Nye 308-309) [i]
.
More recent studies show that Iranian oil has a major impact on the U.S. economy even though
America does not import a single barrel of oil from Iran. In 2008, economists Dean DeRosa and
Gary Hufbauer presented a paper in which they claimed that if the United States lifted
sanctions on Iran, the world price of oil could fall by 10 percent which would translate into
an annual savings of $38-76 billion for the United States [ii] .
But sanctions alone were not responsible for oil price hikes in 2008 and beyond. In July
2008, oil had reached a peak of $142.05/bbl (see chart HERE ). This price hike
came on the heels of some important events. In May, President Bush sent a ' warning message' to Iran on
the same day that additional aircraft carriers with guided-missile destroyers were sent to the
Persian Gulf.
In June of the same year, the New York
Times reported that: "Israel carried out a major military exercise earlier this month that
American officials say appeared to be a rehearsal for a potential bombing attack on Iran's
nuclear facilities."
In July, then presidential candidate Barak Obama asked for
tougher sanctions to be imposed on Iran.
It was not until September 2008 when President
Bush declined to help Israel attack Iran that oil prices started to relax. They hit a low
of just over $53 /bbl in December 2008.
Oil prices continued to rise again under Obama's sanctions and reached well past the $100
mark. The prices climbed down once again during the JCPOA negotiations reaching an all time low
of $30.24/bbl in January 2016 – after the signing of the JCPOA.
Today, oil prices stands at $74.30/bbl. A fact not lost on any American who has filled up
his/her gas tank lately– and paid for groceries. The deadline for Iran oil cut off is yet
months away, but the impact has started.
Given that other countries may step in to compensate for some of the Iranian oil
loss, other factors which effect prices must be considered – the most important of which
is the security of the Strait of Hormuz. As mentioned previously, the British oil blockade
scenario of 1951 will have far different consequences in 2018 should America impose an economic
blockade or oil embargo.
In the 1950's, Iran did not have the military might to retaliate to the oil embargo and the
naval blockade was aimed at crushing the economy in order to bring about regime change. This
economic blockade, should it be allowed to happen, would crush the economy of much of the
world.
As it stands, 35% of seaborne oil goes through the Strait of Hormuz 85% of which goes to
Asian markets. As the US Energy Information Administration (EIA) has stated: "The blockage of
the Strait of Hormuz, even temporarily, could lead to substantial increases in total energy
costs."Today, Iran not only has the military might to block the Strait of Hormuz in
retaliation, but it also has the legal right.
The 1982 United Nations Convention on the Law of the Sea (UNCLOS) stipulates that vessels
can exercise the right of innocent passage, and coastal states should not impede their passage.
Under UNCLOS framework of international law, a coastal state can block ships from entering its
territorial waters if the passage of the ships harms "peace, good order or security" of said
state, as the passage of such ships would no longer be deemed "innocent" [iii] .
Saudi Arabia and the UAE export oil through Iran's territorial waters. Should they help America
choke Iran's economy, their passage is not deemed 'innocent'.
Even if Iran simply chooses to merely delay the passage of tankers by exercising its right
to inspect every hostile oil tanker that passes through the Strait of Hormuz, such inspections
and subsequent delays would contribute to higher oil prices.
No doubt, the Iranian navy is no match for the formidable US navy. However, the shallow,
narrow waters of Hormuz do not allow for the maneuvering of US battleships. The very presence
of warships can lead to incidents. At its narrowest point, the Strait of Hormuz is 21 miles
wide – hardly wide enough for a naval battle to take place and allow the passage of oil
tankers at the same time. In recent years (2012), the USS Porter, a US navy destroyer,
collided with an oil tanker in the Strait of Hormuz. The collision left a big whole in the
navy destroyer.
American officials and oil companies have attempted to assuage the concern of over oil
shortages by stating that America is one of the top oil producers. Some fact checking is in
order.
According to EIA's latest available data, America's total exports in 2018
(thousands of barrels/month) was 7,730 bblin April. The same governmental body stated that
total imports for the same month was 310,295. According to the EIA: "In 2017, the United States
producedabout 15.4 million barrels of petroleum per day (MMb/d), and it consumed about 19.9
MMb/d. Imports from other countries help to supply demand for petroleum." (Click HERE for
explanation of imports and exports).
These facts do not stop the spread of such news. As recently as June 4, 2018, Offshore Technology announced America is marching toward being the biggest oil
producer. Important factors to bear in mind are that 1. America is the largest oil consumer and
continues to have a deficit, and 2. Shale oil production is up thanks to higher oil prices.
While environmentalists objected to shale oil production, oil companies halted the
extraction of oil when prices dropped. Anything above $50/bbl makes shale oil production
feasible – which also makes it more expensive of the consumer. Although Mr. Trump and his
administration have no regard for the environment, many states and countries have banned shale
oil production (see LINK for list as of December
2017).
So the American people (and much of the rest of the world) is left with a stark choice.
Either cave in to Mr. Trump's demands, accept loss of business, pay much higher oil prices at
the pump and for consumer goods, prepare for a potential war, and sacrifice the environment
– especially water, and mortgage the future of the earth more than we already have, or,
don't heed Trump's demands – even if means a short term loss.
Either way, messing with Iran's oil exports is not an alternative that the world can afford.
It may well be that Mr. Trumpis beholden to Mr. Netanyahu. He may well feel comfortable enough
to subject the American people – and their allies to financial hardship; but the question
is will Americans and the rest of the world sacrifice themselves at the Trump-Netanyahu
altar?
* Soraya Sepahpour-Ulrich is an independent researcher and writer with a focus on
U.S. foreign policy and the role of lobby groups in influencing US foreign policy.
The USA elite might now want abandoning of GATT and even WTO as it does not like the results. That single fraud on the west has
had catastrophically perverse consequences for the coterie of killer's future and all because the designers of GATT had never thought
outside the square of economics and failed utterly to grasp the gift of scientific and manufacturing politics.
Notable quotes:
"... The US still depends heavily on oil importation -- it is not "independent" in any manner whatsoever. Here's the most current data while this chart shows importation history since 1980. ..."
"... the only time a biological or economic entity can become energy independent is upon its death when it no longer requires energy for its existence. ..."
"... A big part of the US move into the middle east post WWII was that they needed a strategic reserve for time of war and also they could see US consumption growing far larger than US production. ..."
"... The USA of WAR may have oil independence, but it is temporary. The race is on for release from oil dependency and China intends to win in my view. It is setting ambitious targets to move to electric vehicles and mass transit. That will give it a technology dominance, and perhaps a resource dominance in the EV sphere. We are in the decade of major corporate struggles and defensive maneuverings around China investments in key EV sectors. ..."
"... In ten to twenty years' time the energy story could well be significantly different. The USA and its coterie of killers are still fighting yesterday's war, yesterday's hatred of all things Russian, yesterday's energy monopoly. ..."
"... I don't believe that the USA of WAR has changed or even intends to change the way they play their 'game'. The General Agreement on Tariffs and Trade set the trajectory for technology transfer, fabrication skills transfer, growth of academic and scientific achievement in 'other' countries (China, Russia etc). Their thoughts in the GATT deal were trade = economics = oligarchy = good. ..."
"... That single fraud on the west has had catastrophically perverse consequences for the coterie of killer's future and all because the designers of GATT had never thought outside the square of economics and failed utterly to grasp the gift of scientific and manufacturing politics. ..."
"... Canada and the gulf monarchies are the only countries with large reserves that are not hostile as yet to the US. As the US no longer is totally reliant on imports to meet its consumption, Saudi's, Bahrain and co are now expendable assets. ..."
The US still depends heavily on oil importation -- it is not "independent" in any manner whatsoever.
Here's the most current data
while this chart shows importation
history since 1980.
As I've said before, the only time a biological or economic entity can become energy independent is upon its death when
it no longer requires energy for its existence.
What I am looking at are strategic reserves, not how much oil is currently produced. With shale it now has those reserves and
shale oil I think is now at the point where production could quickly ramp up to full self sufficiency if required. Even if the
US were producing as much oil as they consumed, they would still be importing crude and exporting refined products.
A big part of the US move into the middle east post WWII was that they needed a strategic reserve for time of war and also
they could see US consumption growing far larger than US production.
@Peter AU 1 #28 Thank you for that stimulating post. I just have to respond. And thanks to b and all the commenters here, it is
my daily goto post.
The USA of WAR may have oil independence, but it is temporary. The race is on for release from oil dependency and China intends
to win in my view. It is setting ambitious targets to move to electric vehicles and mass transit. That will give it a technology
dominance, and perhaps a resource dominance in the EV sphere. We are in the decade of major corporate struggles and defensive
maneuverings around China investments in key EV sectors.
In ten to twenty years' time the energy story could well be significantly different. The USA and its coterie of killers
are still fighting yesterday's war, yesterday's hatred of all things Russian, yesterday's energy monopoly.
I don't believe that the USA of WAR has changed or even intends to change the way they play their 'game'. The General Agreement
on Tariffs and Trade set the trajectory for technology transfer, fabrication skills transfer, growth of academic and scientific
achievement in 'other' countries (China, Russia etc). Their thoughts in the GATT deal were trade = economics = oligarchy = good.
That single fraud on the west has had catastrophically perverse consequences for the coterie of killer's future and all
because the designers of GATT had never thought outside the square of economics and failed utterly to grasp the gift of scientific
and manufacturing politics.
By gross ignorance and foolish under-investment, the USA of WAR and its coterie of killers have eaten their future at their
people's expense.
Light sweet vs heavy sour. Light means it contains a lot of diesel/petrol. Sweet means low sulphur. Many oils are heavy sour.
Canada sand. the stuff they get from that is thick bitumen with high sulpher. The sulpher needs to be removed and the bitumen
broken down into light fuels like diesel and petrol.
Canada and the gulf monarchies are the only countries with large reserves that are not hostile as yet to the US. As the
US no longer is totally reliant on imports to meet its consumption, Saudi's, Bahrain and co are now expendable assets.
The great game for the US now is control or denial. Access to oil as a strategically critical resource is no longer a factor
for the US.
"We're an empire now, and when we act, we create our own reality. And while you're studying that reality – judiciously, as
you will – we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're
history's actors . . . and you, all of you, will be left to just study what we do." Karl Rove.
The squealing and consternation coming from the UK indicates that the empire has changed course and the UK is left sitting
on its own shit pile.
I encourage you to give the Escobar article a second reading. I just did to make sure I knew what it was saying. I think karlof1
is making the right points from it.
The collaboration between Saudia Arabia and Russia is a very small part of the article, and no one disputes that this collaboration
is occurring. Russia may even be part of OPEC soon, if it chooses. The relationship works against the US but it's not specifically
made for this reason. Read Adam Garrie's take on this to see that the moves into OPEC by Russia in recent years are clearly from
its own interest as a hugely major supplier, and that Saudi Arabia needs Russia:
The New Russia-Saudi Partnership Has Riyadh's US Ally Over a Barrel
I just skimmed it a third time and I don't see Escobar saying anywhere that the Saudi-Russia relationship is to kill US shale.
He does say that both Russia and Iran are interested in countering it. I think the point here is that all serious oil producers
with profitable reserves take alarm at the US shale oil because it's hard to say that it's a real commodity with an inbuilt profitability.
It's a short-term entry into the market that can serve to disrupt the market temporarily, but it has no staying power. I suspect
most nations would prefer it simply not intrude.
No one actually has to act against US shale - it's something of a pretender in the real oil world anyway, and this has long
been commented upon. Escobar's point that the US shale is largely a myth is not a new concept. At best the reserve will deplete
within 15 years, and that's at best - along the way it will destroy the US potable water table. And its intrinsic value is far
from clear, since the entire industry is dubiously financed using relatively free Federal Reserve money. As Escobar points out,
many call $100 per barrel the profit threshold for shale - that's a ludicrously high bar for profitability in the oil world.
Much of Escobar's article was about the relationship between Russia and Iran, and it served also as a very good primer in world
oil and petro-currency numbers. I found it pretty sound.
"... You don't need to give use Northstream 2. We will build it ourselves. ..."
"... Nordstream II only blocking party is Denmark, and they can and will bypass it at some price, if need be. ..."
"... Almost all of the countries that Nord Stream 2 passes through have signed on to its construction. The only holdout is Denmark. In response Gazprom has said it will reroute the pipeline through international waters. There is nothing the US can do about that and Denmark can say goodbye to its share of transit fees. ..."
"... A lot of that sort of crap was being pumped out by trolls and regulars alike a few weeks back on Putin, Nutty and SW Syria. Putin had done a deal and was giving SW Syria to nutty cetra cetra. Like Putin and Xi, Iran and others are too stupid to realize they have to work together against US attacks. ..."
"... Russia has to defend Iran. There is no chance that Putin will sell it to Trump. Once again we see the dreaded "US can do anything" disease arising. In fact US options are limited and evaporating. ..."
"... The most likely outcome of the 'summit'is a renewal or strengthening of old agreements on arms control and much high sounding chatter: in geopolitics the die is cast. ..."
Almost all of the countries that Nord Stream 2 passes through have signed on to its
construction. The only holdout is Denmark. In response Gazprom has said it will reroute the
pipeline through international waters. There is nothing the US can do about that and Denmark
can say goodbye to its share of transit fees.
Also Crimea is non-negotiable for Russia. It is Russian territory irrespective of what
happens.
A lot of that sort of crap was being pumped out by trolls and regulars alike a few weeks back
on Putin, Nutty and SW Syria. Putin had done a deal and was giving SW Syria to nutty cetra
cetra. Like Putin and Xi, Iran and others are too stupid to realize they have to work
together against US attacks.
Russia has to defend Iran. There is no chance that Putin will sell it to Trump.
Once again we see the dreaded "US can do anything" disease arising. In fact US options are
limited and evaporating.
Incidentally it is very easy and probably wise to promise the US, in June, not to buy oil in
November. It costs nothing and fits into bazaar bargaining strategies.
The most likely outcome of the 'summit'is a renewal or strengthening of old agreements on
arms control and much high sounding chatter: in geopolitics the die is cast.
"... The Iranians will lose marketspace, sure, but the inevitable increase of the price of oil will somewhat soften the blow. And anything over $100 per barrel, along with a stronger dollar, is proven to be detrimental to energy importing countries. It will be painful to keep the economy rolling. ..."
Oil will continue to flow from Iran, there simply isn't a significant supply stemming from
the Saudi-Russia alliance or US shale to fill the gap.
The Iranians will lose marketspace,
sure, but the inevitable increase of the price of oil will somewhat soften the blow. And
anything over $100 per barrel, along with a stronger dollar, is proven to be detrimental to
energy importing countries. It will be painful to keep the economy rolling.
And when there's less appetite for oil; the price of oil crashes resulting in another big
financial crash (due to bad dept) followed by another round of austerity measures which
spells political turmoil in a number of countries. And the landscape gradually changes.
So Trump asked the Saudis to pump 2 million more barrels per day to offset Iranian exports?
Daffy!. Saudis do not have a spare barrel, let alone 2 million. Ask Simmons. Oh wait, he
has been offed:
LONDON(Reuters) - The leader of Saudi Arabia has assured U.S. President Donald Trump that
the Kingdom can raise oil production if needed and the country has 2 million barrels per
day of spare capacity that could be deployed to help cool down oil prices to compensate for
falling output in Venezuela and Iran.
In a tweet on Saturday, Trump said Saudi Arabia had agreed to increase output by up to
this amount, although a subsequent statement from the White House rowed back on this
assertion.
Either way, the kingdom, OPEC's biggest member, can barely raise output by 1 million bpd
to 11 million bpd and even that would be difficult, according to industry analysts who
forecast a further oil price rally due to a lack of new supply.
Below are comments from some leading OPEC analysts:
[ED: one of several cited below]
"The Saudis do not have 2 million bpd of spare capacity as it would imply production of 12
million bpd. They can likely produce a maximum of 11 million and even that will be running
their system at stress levels," said Ross.
He added that with a potential output fall of up to 1.5 million bpd in Iran and
further outages in Venezuela and Libya, the world could be short of 2 million bpd of oil
output without an increase in Saudi output by the end of the year."
Pepe declares US shale to be a myth, but then says KSA and Russia have teamed up to fight. Us
production figures also left out. Disappointing piece from Pepe, especially this glaring
contradiction where KSA and Russia has to team up to fight what he calls a myth.
Pepe's referring to the assumed longevity of shale which is proven to be a gross lie. I can
provide documentation about that but it will have to wait until I have more time to work.
karlof1
Ok so according to Pepe Russia and KSA are joining forces to fight this gross lie.
either shale is a real and major threat, or Russia and KSA are not joining forces. That is
the glaring contradiction in Pepes piece. the other option is that both Russia and KSA both
of which have some knowledge of oil are mistaken about US shale.
Already have Syria? Not really. Heard of the SDF occupying the North-Eastern third of
Syria. If Trump & Putin can't come to an agreement on Iran what's the bet Trump decides
to pump money, weapons and US troops into North-Eastern Syria to fully support the Kurds?
NordStream II? Sure, it will be built, but Trump can sanction Germany and German industry
- ie automakers - heavily if he so wishes. He might do. He can blame NordStream II. He's
certainly been talking about it.
There are certainly ways and means Trump can create huge trouble for Germany/Russia in
regards to NordStream II even if it is built.
Crimea? Yeah, Russia has it but it is also used as the bludgeon to impose sanctions on
Russia. Perhaps recognising Crimea as part of Russia and dropping all sanctions on Russia
will be offered to Putin in return for Russia staying out of any conflict regarding Iran in
2019.
I'd hardly say Trump has nothing to bargain.
Besides, why would Putin select Medvedev as Prime Minister again despite Medvedev being
obviously a Euro-Atlanticist?
I'd also add - who do you think Russia fears in the future decades.
Is it a decaying Europe/EU who nevertheless can buy lots of Russian goods including oil
& gas obviously?
Or do Russia fear a rising China that always has one eye on the Russian Far East as a
possible place for expansion to take care of their oil & gas & mineral needs?
I suspect - and you can look to the history of Russia/China relations for this - that
Russia retains a more existential fear of China than anyone else.
Russia always clearly seeks to balance Europe/EU/US/Atlantic against China and others.
Where does Iran fit in all this? If Iran is taken out who benefits? Doesn't Iran being
taken out strengthen Russia's hand vis-a-vis China in terms of oil & gas? I'd say it
does. Certainly. Without Iranian oil & gas China becomes more dependent on who?
RUSSIA!
So I bet Russian thought would tend to say to China. Look, we are not going to put
ourselves on the line to defend Iran. But hey, if you want to do that we'll support you doing
so, afterall, Iran is of a more of a vital strategic interest to you than us.
We defended Syria, we can't defend anyone and you can't expect us to defend everyone. If
you want a country to retain its independence you have to step up to the plate every now and
then rather than just relying on the Russian military.
And look - we defended Syria - what did you do in Syria's defence?
Just to finish this comment.
In case you haven't noticed the US has put a date of November 4 on stopping the
export/import of Iranian oil. Which is? It is 2 days before the November 6 Mid-Terms...
It's a clear set-up for 2019.
My prediction.
There will be military action against Iran in the first half of 2019.
I suspect March-April-May being the most likely.
At that time you also have Brexit, European Elections (dominated by populists), Ukrainian
Presidential Elections, South African Elections, Indian Elections... It's a big few
months.
My advice? Buy oil & gas in the second half of this year - it's value is likely to
skyrocket in 2019.
What will Iran's response be? I'd say if you are in any of Saudi Gulf Coast, UAE (Dubai
& Abu Dhabi), Kuwait or Bahrain - get out before New Year's!!!
Re: Posted by: Peter AU 1 | Jul 1, 2018 11:14:41 PM | 27
I'm not judging one way or another on what Putin will necessarily do, but clearly Trump's
gambit is to wean Iran off Russian support.
Will it work? Who knows. But Iran clearly has less strategic importance to Russia than
Syria.
Let me ask you a question. Do you think Russia prefers Iranian-Qatari oil & gas
pipelines through Iraq-Syria-Turkey to Europe or would Russia prefer Saudi-UAE-Qatari oil
& gas pipelines to Europe??
Any effort to understand US foreign policy from actual US interests is a futile exercise in
frustration. US foreign policy is driven by two things:
1. The interests of international financiers (heavily Jewish)
2. The Israeli government.
At consideration for actual US interests is secondary if such things considered at all.
That should be obvious enough to everyone by now.
The one thing that Russia and/or China could do that would do more to avoid another major
power war, is to loudly, clearly and publicly inform the Israelis (the people as well as the
government) that any attack upon Russia, China, or their forces by the US or NATO will be
treated as a direct attack upon Russia/China by the state of Israel and the Jewish people and
these will be utterly destroyed in the first salvo of the Russian/Chinese response.
The second thing that could/should be done, is for Russia to implement a covert campaign
of targeted assassinations of Jewish figures who are actively engaged in efforts to undermine
Russian interests. This would include people like Sheldon Adelson, Haim Saban, key players in
international finance, etc. No Jew anywhere in the world should feel that they are beyond the
reach of Russian retaliation. This is precisely how the Israelis conduct their foreign policy
and Russians should not shirk from engaging fire with fire.
@Julian
I think you underestimate the long term benefit of a stable and prosperous Iran in the
greater Eurasian gambit (Infrastructure Node, stability for the region) vs the short term
gains Russia may achieve from a destroyed and fractured Iran that is in disarray. Russia
doesn't just export energy after all. Exploding oil prices will end up hurting consumer
nations, which in turn affects the global economy and by extension oil producers, there is
always a delayed feedback loop.
Just because someone competes with you in the energy realm doesn't automatically mean you
want that actor weak or destroyed. If that was the case, then why does Russia maintain good
relationships with Azerbaijan, a direct competitor to Russian Gas? Similarly Central Asian
countries are competitors in the gas market for China, yet Russia would never allow these to
be subverted by radical Islamists without acting.
"... The great power game is why there is continuity of government policy in the 'US west' no matter who is elected. Within the great power game democracy in the west is meaningless. ..."
"... If the US is changing how it plays the game, then the Brit players may be getting desperate. They are now small players but unlike the US do not have an oil reserve. ..."
"... This may be the reason the Brits have ramped up the propaganda to the ridiculous and also why they have attempted to take down Trump. ..."
Loot is only a side benefit for post WWII wars and no doubt before. Oil is energy and energy
means power to those that control it. UK, French, US have fucked the MENA region over simple
for control of the oil.
Working to prevent communism, socialism, democracy and pan Arab
movements which are all a threat to FUKUS control of MENA, and then pulling the same dirty
tricks on each other. Russia has its own all and through the Soviet era seems to have only
dabbled in the region.
China needs to import energy and so the great power game of controlling
or denying access to energy continues.
karlof1 @ 3 said"Criminality mostly driven by Greed."
james @ 5 said: "trump isn't much different or he would be addressing this too..."
Two bottom line truths, that are apparent...
As always, profits "trump" humanity. How to change that mindset? I for one, don't know,
but, the so called "religious" among us, should ask themselves that same question. IMO,
religion is, as practiced, mostly crowd control..
The great power game is why there is continuity of government policy in the 'US west' no
matter who is elected. Within the great power game democracy in the west is meaningless.
with USA's new found oil independence, the direction they take may change from the last 70
years or so.
Another recent change is the rise of current Russia and their vision of a multi polar
world, also the rise of China.
If the US is changing how it plays the game, then the Brit
players may be getting desperate. They are now small players but unlike the US do not have an
oil reserve.
This may be the reason the Brits have ramped up the propaganda to the ridiculous and also
why they have attempted to take down Trump.
2018-06-26 (Rudaw) When US sanctions were placed on Iran in 2012, the four Asian countries
were given a waiver, requiring them to reduce their business with Iran by 20 percent each six
months rather than halt trade immediately.
The Asian oil buyers are less likely to receive a similar waiver from the Trump
administration Iran may need to resort to a bartering system to continue selling its oil.
Under the 2012 US sanctions, India imported $10.5 billion worth of goods, mainly crude oil,
and exported commodities worth $2.4 billion.
The barter system will be inefficient, as Iran's oil sales are greater than the value of
what it imports from these countries. It also cannot use the currencies of these countries
for international business transactions. http://www.rudaw.net/english/business/250620181
2018-06-26 (Bloomberg) U.S. presses allies to cut Iran oil imports to *zero* by November
* U.S. isn't granting waivers on Iranian oil imports ban
(State Department Official)
"The global economy looks like the Titanic right now. The iceberg is the incoming oil price
spike and the complacent investment community won't even know what hits them. "
-Baby Domer
So, an important question for this board is, could we have reached peak oil production this
year? The Permian will increase substantially into 2020. However, that will be partially
offset by the Venezuelan drop. Add in other declines, and the drop could easily offset any US
production. At some point, OPEC will see that extra production will never meet demand, and
not just waste what they have.
It depends totally on political scenarios, not technical and not financial.
There's still a lot of growth potential to offset the declines:
– Permian
– Other US shales to a degree
– Kanada with it's vast heavy oil ressources
– Venezuela
– Russia
– Iraq
– Iran
– SA (nobody knows), at least they can call to their spare capacity
– Kuwait
– UAE
-Brasil
That's 10 locations, some are politically knocked out ( Ven, Iran partly) from growth.
The more important thing for world economy is: How long can they support the consumption
growth, additional to the decline of all other countries.
I think peak oil is somewhat more melodramatic: When Ghawar finally dries up, we have
reached peak oil. It will dry fast, due to all these horizontal tapping keeping the oil
flowing until the last feed of oil column. And replacing these 5 mb/d will require an
additional fully developed Permian – something not in sight at the moment.
Libya's Tripoli-based NOC Says Exports from Benghazi-based NOC in the east are "illegal"
2018-05-26 BENGHAZI, Libya/TUNIS (Reuters) – Eastern Libyan commander Khalifa
Haftar's forces have handed control of oil ports to a National Oil Corporation (NOC) based in
the east, a spokesman said on Monday, a move the internationally recognized NOC in Tripoli
dismissed as illegal.
If implemented, the transfer of control would create uncertainty for buyers of Libyan oil who
normally go through NOC Tripoli.
In comments later confirmed to Reuters, Ahmed Mismari, spokesman of Haftar's Libya National
Army (LNA), said on television that no tanker would be allowed to dock at eastern ports
without permission from an NOC entity based in the main eastern city, Benghazi.
https://www.reuters.com/article/us-libya-oil/east-libyan-forces-say-oil-ports-handed-to-eastern-based-noc-idUSKBN1JL2DQ
Tripoli-based NOC https://pbs.twimg.com/media/DgkrEMeXUAADLGS.jpg
Some kind of summary with some details from Libya (from comments section in HFIR article
above – Game Over – Oil Prices Are Going Higher).
Nigeria and Libya are also becoming disruption hotspots. Three of Nigeria's main crude
streams (Forcados, Bonny Light and Qua Iboe) are either halted or severely disrupted, but
violence in Libya grabbed the recent headlines. Militias led by Ibrahim al Jathran, former
head of the local Petroleum Facilities Guard, attacked and briefly seized the 0.35 mb/d Es
Sider and 0.22 mb/d Ras Lanuf terminals from Khalifa Haftar's Libyan National Army (LNA).
Although the LNA are back in control, Libyan oil output has collapsed from 0.95 mb/d to
around 0.55-0.60 mb/d because of the fighting and NOC has declared force majeure at the two
ports (along with apparently unrelated technical issues undermining production at AGOCO-run
fields in the east).
After around 10 days of fighting, the extent of the damage at the two terminals remains
unclear. There is currently no information about the status of Es Sider, which exported
around 0.30 mb/d in the previous three months. The destruction of two storage tanks at Ras
Lanuf, which was exporting around 0.10 mb/d before the clashes, has reduced storage capacity
from 0.95 mb to 0.55 mb. Seven tanks at the terminal had already been damaged in previous
clashes and the destruction of another two leaves only four tanks capable of operating. Once
the fighting is over (and there is a considerable risk of further clashes over the next few
weeks), it will take several days to evaluate the status of Es Sider and Ras Lanuf. This
would be followed by emergency repairs, which could take a week or two, with export capacity
recovering only gradually. Consequently, we expect output to remain at 0.55-0.60 mb/d until
early/mid-July, even as NOC studies options to bypass Ras Lanuf and possibly divert exports
to the Zueitina terminals.
In conclusion: Libya is good for no more than 0.8 Mb/d, but likely less than that in
2018.
The debate seems to be around what effect the risk of secondary sanctions from US
government for international companies will have. Some argue that the US allies and their
companies will not pick a fight over this with the US right now. In either case, it certainly
is not good for the Iranian economy which contracted after the last round of sanctions and
boomed when they were lifted afterwards. Also the Iranians want western equipment and
competence to develop their oil and gas fields (some of their oilfields are somewhat
complicated to develop), and it is not certain Lukoil and russian service companies can be a
good enough replacement.
There are some hurdles with switching customers for large oil volumes. Tanker freight and
insurance services now done by western companies afraid of sanctions will have to be replaced
or the obstacles overcome somehow. But I agree with you that China, while also having a
futures market trading in yuan, will look to Iran when shortage arrives. However the
perception of shortage has still not arrived in oil markets today. Some reduction of export
from Iran is likely both initially and for some time further. Hard to say how much, some
argue that it takes 6-12 months to see the full effects of US sanctions. And once sanctions
now are in place, even if it was untimely given the supply situation in the oil market, it
will not be practical and too confusing as a political move to see them lifted soon (less
than 1 year).
Antony C. Sutton, ´Wall Street and the Bolshevik Revolution', 1974 New Rochelle,
N.Y.
describes how Wall Street supported bolsjewism in order to prevent that German, suppose also
Dutch and other, trade, with Russia was resumed.
WII and the aftermath created the Atlantic alliance.
Just yesterday Pieter Hoekstra, USA ambassador in the Netherlands, stated that Russia should
be punished for MH17 by more sanctions, no new gas pipeline from Russia to Germany.
What he did not say that this implies our buying of USA gas, 20% more expensive. The MH17
show, in my opinion is run like the Sept 11 show. Or even the holocaust show, constant
reminders.
The USA fear about Russia and the EU member states seems to be twofold:
more trade with Russia, and the railway connections with China, threaten to turn the USA
into an economic backwater
Precisely. US could eventually (20-30 years from now) turn into a country similar to many
Latin American countries: rich in resources, demographically messy and ungovernable, weak
infrastructure, but above all remote and quasi-provincial.
The 'Atlanticist' project is meant to forestall the provincial Latin American future.
Washington does have some tools: dollar domination, military force, Hollywood, technology.
But none of those are necessarily sustainable without also actively messing up
Euro-Russia-China economic convergence. It might require a war to delay the inevitable slow
descend into a backwater across the Atlantic.
From the Bloomberg article: "The U.S. plans to speak with the governments of Turkey, India
and China, all of which import Iranian oil, about finding other supplies."
Iranian condensate will most likely replace US condensate to China as much as possible.
China is the key to if/when this harsh "embargo" of Iran will ease. They have the strength to
stand up against the US and then others will follow suit (e.g. India). A barter system (goods
vs. goods trade) or payment in yuan could probably be a good enough way to avoid american
banking sanctions. But if China wants to stand up against US at this point is uncertain. If
this strangling of Iran is highly successful, it is hard to see the rewards. A high oil price
that will be the tipping point for the global economy in the wrong direction or indirectly
(hopefully not directly – who needs another war now?) overthrow the Iranian government
and thus the creation of new political problems in the country; a repeat of the Iraq
experience almost. I almost forgot that there is the nuclear issue there as well, maybe that
is also a driver
"We have a lot of diplomatic muscle memory for urging, cajoling, negotiating with our
partners to reduce their investments to zero," the official added.
(This official infers that EU countries will soon capitulate to US demands, but does he
believe that, say, India will agree to this? The CNN reporters don't ask.)
"I think not, it's a lot cheaper to add a few more production wells than to add a couple of
million barrels of high pressure water injection capacity (topsides facilities and the wells
needed to inject it"
Water injection isn't the problem, its water cut. The don't need to inject more if they
keep the water cut stable. In order to keep the water cut, they have to perodically drill new
wells to keep the wells in contact with the Oil column. Over time the Water column push up on
the Oil column (ie Oil floats on Water). All the CapEx/Opex goes into drilling to keep in the
Oil Column Zone as well as add new wells to tap oil trapped in pockets. As the Oil column
continues to shrink and and as the water column become increasing contact with the cap rock
its going to required more and more drilling to maintain production.
My guess well know when SA starts running into problems when we start to see the rig count
increase and the production dropping over a period of a couple of years.
"The drilling of new oil wells is to maintain current production, not to increase it"
SA cannot increase Oil production much. They are working on extracting the remaining cream
(oil column) floating on a see of water. Increasing production would just increase the water
cut and also increase trapped oil that would later be more costly to extract. The only way SA
can increase production is to tap new fields or increase drilling for oil trapped in pockets.
But at some point these options will vanish over time as it will be increasing more difficult
to squeeze more oil out, like trying to squeeze trapped toothpaste out of a depleted
toothpaste tube.
I didn't say water injection was the problem I said it was the limit to increasing
production. It is. Water cut is the problem that leads to decline unless they keep drilling
new wells.
Two ways that increasing water cut is a problem are: 1) you have to inject more water for
the same amount of oil, which they don't have, 2) you have to treat more produced water,
which they don't have capacity for. Exactly what I said above. The third is that it reduces
overall well flow and, more so, oil flow; but that is easily got round if it easy to drill
new wells, as is the case for Saudi, even the offshore fields, which are shallow. That also
solves the first two problems because the individual field and overall country water cuts are
held steady.
The limits on surface facilities are much more expensive and long term (5 years at least)
to get round, but it could be done, therefore it is wrong to say that the only way to
increase production is to tap new fields.
(ps – I worked on water flood oil fields, including some minor studies for Saudi,
for at least 15 years through my career, the water is a bigger influence on the design and
operation than the oil.)
That all together sounds like it's completely senseless to keep some spare capacity for
fields like this.
This capacity will cost billions, hold back for not much. A big oil storage is better
there for satisfying demand peaks or temporary supply losses.
Reserve capacity is cheap to have when you are in primary recovery of a conventional
(giant) field.
The only illusion of reserve capacity would be in fields with tertiary recovery would be
to postpone maintainance for a few months to get that 5% more production.
Some spare is always needed, just to maintain production during maintenance or unplanned
outages. Sparing doesn't postpone maintenance, it means maintenance can be done without
taking the plant offline, or at least not for too long, so you get maximum returns on your
investment (when plants are taken down for major turn arounds it is to do work on items for
which there are no online spares).
Depending on the maturity of the field there is also always different amount of sparage in
the different project components – e.g. the wells, compression, power generation, oil
processing, export capacity, water injection, water processing – the limit is the
component with the least amount of sparage.
In Saudi also, at least for the heavy fields, they have been known to rest them completely
for a time, this allows the water contact to settle out and avoid excessive coning, which
provides a much better sweep of the oil and higher recoveries (I don't think any where else
has that luxury).
So when someone says "we have spare capacity" it can mean almost anything from
2×100% pumps on a particular duty to an entirely unused, ready for action oil
field.
From a modern capitalist approach with everything just-in-time and the next quarterly
statement being all important then excess sparing wouldn't please the shareholders, but Saudi
designed facilities with 50 year life times, so it might be different.
From looking at their recent production profiles, which seem to go up when they report a
new start-up and then decline, and stock draws, which have been consistent since January
2016, I find it hard to believe they have a large amount of "real" spare capacity –
i.e. that's easy to bring on line and that doesn't alter any of the performance of the fields
over the long term or compromise planned maintenance schedules – but I can't say for
sure. And, as I've said, the limit to expanding production (that means beyond just using up
the spare) is almost certainly with the surface facilities for water, so it's likely that is
also the part with the least spare capacity.
It sounds like you believe they might be able to maintain a plateau of 10 Mb/d for many
years, if they just drill more wells as needed. Though I may not be understanding
correctly.
There's the big question. Once the horizontal wells are at the top of the reservoir then you
can't drill any more and once the water contact hits them, even with intelligent completions,
then the decline will be fast (but even that is relative, huge fields take longer to decline
than small ones). There was a report in the Oil Drum some time ago that indicated that a lot
of Ghawar wells were near the limit but nothing much seems to have happened since to indicate
this turned into a problem, but then Saudi has a lot of other fields. On some of their
offshore fields they are replacing all the wellheads to add ESPs, that usually means they
have run out of new well options. Their rig count is declining, but maybe jus because they
are drilling much more productive MRC wells.
It's the difference between the size of the tank and the size of the tap (or for water
injection more like the size of the vent that lets air in to stop the tank collapsing under
suction). Might only know what's going on well after the fact.
I've told you that once you start down the Trade War path forever it will dominate your
destiny.
Well here we are. Trump slaps big tariffs on aluminum and steel in a bid to leverage Gary
Cohn's ICE Wall
plan to control the metals and oils futures markets . I'm not sure how much of this stuff I
believe but it is clear that the futures price for most strategically important commodities are
divorced from the real world.
But today's edition of "As the Trade War Churns" is about China and their willingness to
shift their energy purchases away from U.S. producers. Irina
Slav at Oilprice.com has the good bits.
The latest escalation in the tariff exchange, however, is a little bit different than all
the others so far. It's different because it came after Beijing said it intends to slap
tariffs on U.S. oil, gas, and coal imports.
China's was a retaliatory move to impose tariffs on US$50 billion worth of U.S. goods,
which followed Trump's earlier announcement that another US$50 billion in goods would be
subjected to a 25-percent tariff starting July 6.
It's unclear as to what form this will take but there's also this report from
the New York Times which talks about the China/U.S. energy trade.
Things could get worse if the United States and China ratchet up their actions
[counter-tariffs] . Mr. Trump has already promised more tariffs in response to China's
retaliation. China, in turn, is likely to back away from an agreement to buy $70 billion
worth of American agricultural and energy products -- a deal that was conditional on the
United States lifting its threat of tariffs.
"China's proportionate and targeted tariffs on U.S. imports are meant to send a strong
signal that it will not capitulate to U.S. demands," said Eswar Prasad, a professor of
international trade at Cornell University. "It will be challenging for both sides to find a
way to de-escalate these tensions."
But as Ms. Slav points out, China has enjoyed taking advantage of the glut of U.S. oil as
shale drillers flood the market with cheap oil. The West Texas Intermediate/Brent Spread has
widened out to more than $10 at times.
By slapping counter tariffs on U.S. oil, that would more than overcome the current WTI/Brent
spread and send Chinese refiners looking for new markets.
Hey, do you know whose oil is sold at a discount to Brent on a regular basis?
Iran's. That's whose.
And you know what else? Iran is selling tons, literally, of its oil via the new Shanghai
petroyuan futures market.
Now, these aren't exact substitutes, because the Shanghai contract is for medium-sour crude
and West Texas shale oil is generally light-sweet but the point remains that the incentives
would now exist for Chinese buyers to shift their buying away from the U.S. and towards
producers offering substitutes at better prices.
This undermines and undercuts Trump's 'energy dominance' plans while also strengthening
Iran's ability to withstand new U.S. sanctions by creating more customers for its oil.
Trade wars always escalate. They are no different than any other government policy
restricting trade. The market response is to always respond to new incentives. Capital always
flows to where it is treated best.
It doesn't matter if its domestic farm subsidies 'protecting' farmers from the business
cycle or domestic metals producers getting protection via tariffs.
By raising the price above the market it shifts capital and investment away from those
protected industries or producers and towards either innovation or foreign suppliers.
Trump obviously never read anything from Mises, Rothbard or Hayek at Wharton. Because if he
did he would have come across the idea that every government intervention requires an
ever-greater one to 'fix' the problems created by the first intervention.
The net result is that if there is a market for Iran's oil, which there most certainly is,
then humans will find a way to buy it. If Trump tries to raise the price too high then it will
have other knock-on effects of a less-efficient oil and gas market which will create worse
problems in the future for everyone, especially the very Americans he thinks he's
defending.
read deep into the article -- the best oil goes to China. Europe gets only what is left.
Haven't needed it, but the North Sea is dying. Iran is the next supplier but if sanctions
eliminate them, Russian oil of whatever quality will be the only choice.
Or Europe could ignore sanctions, if they have the courage.
I
wanted to make a comment about the OPEC(and Russia) meeting coming up and a possible production
increase. The speculation going around is that OPEC and Russia might increase production up to
1.80 mbpd. The minimum production increase would be around 500kbpd. What is the most likely
production increase based on past production?
The only four countries that have any ability to increase production are
1) Russia: Current production 10.9mbpd. High production 11.3mbpd Difference -400kbpd 2) Saudi Arabia: Current production 10.0mbpd. High production 10.6mbpd Difference -600kbpd 3) UAE: Current production 2.9mbpd. High production 3.10mbpd Difference -200kbpd 4) Kuwait: Current production 2.70mbpd. High production 2.8mbpd Difference -100kbpd
The high watermark in production for these countries happened from Mid 2016 to Mid 2017.
Currently these four countries are producing about 1.3mbpd below their all-time high production
limits. Ask yourself what is the likelihood that these four countries will increase production
to all-time highs and potentially surpass their highs which would be required to increase
production to 1.80mbpd? When OPEC did announce production cuts at the end of 2016 many believe
they had increased production to unsustainable levels to give each country a higher quota from
the production cuts. The guys a Core Labs believed they had to cut because it would have
threaten the long term integrality of their fields.
My guess is that the most OPEC and Russia can bring back for a sustainable period is about
half of the 1.30mbpd they reduced from their production highs .maybe about 600kbpd
"... According to US Energy Department figures, China imports approximately 363,000 barrels of US crude oil daily. The country also imports about 200,000 barrels a day of other petroleum products including propane. ..."
Just as China topped the list of nations buying US oil, Beijing – retaliating to
unilateral Trump economic threats – sent jitters through energy markets on Friday by
threatening new tariffs on natural gas, crude oil and many other energy products.
On Friday, Beijing threatened to impose tariffs on US energy products in response to $50
billion in tariffs imposed by US President Donald Trump. Such tariffs would inhibit Chinese
refiners from buying US crude imports, potentially crashing US energy markets and hitting the
fossil fuel industry where it hurts the most: in shareholder approval.
"This is a big deal. China is essentially the largest customer for US crude now, and so for
crude it's an issue, let alone when you involve [refined] products, too. This is obviously a
big development," Matt Smith, director of commodity research at ClipperData, told Reuters.
According to US Energy Department figures, China imports approximately 363,000 barrels of US
crude oil daily. The country also imports about 200,000 barrels a day of other petroleum
products including propane.
The US energy industry has seen its profits boosted by fracking in domestic shale fields,
which produce some 10.9 million barrels of oil per day.
The US is also exporting a record 2 million barrels per day, and encouraging countries like
China to import more US energy products instead of those from Iran, after Trump recently
withdrew from the historic Joint Comprehensive Plan of Action (JCPOA) 2015 nuclear arms deal
with Tehran.
China is currently the largest buyer of Iranian oil as well, purchasing some 650,000 barrels
daily during the first quarter of 2018.
According to Bernadette Johnson with the Denver, Colorado, energy consultancy Drilling info,
tariffs will increase prices for other petroleum products including propane and liquefied
natural gas.
"The constant back-and-forth about the tariffs creates a lot of market uncertainty that
makes it harder to sell cargoes or sign long-term [trade] deals," Johnson noted, cited by
Reuters.
In late March, the White House slapped trade sanctions on China, the world's second largest
economy, including limitations in the investment sector as well as tariffs on $60 billion worth
of products.
Citing "fairness" considerations, Trump referred to the car market, stating that China
charged a tariff ten times higher on US cars than the US did on the few Chinese cars sold in
the US.
Separately, in a bid to deliver on campaign promises, Trump announced his intention to
impose a 25-percent tariff on steel imports and a 10-percent tariff on aluminum imports from an
array of US allies, including the EU, Mexico and Canada. Those nations -- longtime allies to
the US -- have promised retaliatory economic measures.
Trump has also reportedly mulled placing a 25-percent import tax on European cars, something
that would significantly affect the highly-profitable US market for expensive German
automobiles.
"... Just yesterday Pieter Hoekstra, USA ambassador in the Netherlands, stated that Russia should be punished for MH17 by more sanctions, no new gas pipeline from Russia to Germany. What he did not say that this implies our buying of USA gas, 20% more expensive. The MH17 show, in my opinion is run like the Sept 11 show. Or even the holocaust show, constant reminders. ..."
"... The USA fear about Russia and the EU member states seems to be twofold: (1) more trade with Russia makes subjugation of Russia impossible; (2) more trade with Russia, and the railway connections with China, threaten to turn the USA into an economic backwater ..."
Antony C. Sutton, ´Wall Street and the Bolshevik Revolution', 1974 New Rochelle, N.Y.
describes how Wall Street supported bolshevism in order to prevent that German, suppose also Dutch and other, trade, with Russia
was resumed.
WWII and the aftermath created the Atlantic alliance.
Just yesterday Pieter Hoekstra, USA ambassador in the Netherlands, stated that Russia should be punished for MH17 by more
sanctions, no new gas pipeline from Russia to Germany. What he did not say that this implies our buying of USA gas, 20% more expensive.
The MH17 show, in my opinion is run like the Sept 11 show. Or even the holocaust show, constant reminders.
The USA fear about Russia and the EU member states seems to be twofold: (1) more trade with Russia makes subjugation of
Russia impossible; (2) more trade with Russia, and the railway connections with China, threaten to turn the USA into an economic
backwater
"... My own hunch is that these reports may well be true. How long can the Saudis (and the Western media) conceal what has happened? ..."
"... Second, I believe the trip by our Secretary of State was in response to the incident of April 21st. My hunch is the Crown Prince was gravely wounded and later perished at a Military Hospital. ..."
"... Third, the night of the incident a twitter user named CivMilAir tracked the Royal Medevac jet leaving the airport near the gunfire and documented the airplane turning off its transponder. There was speculation concerning whether or not it was the Crown Prince that night on that thread. There was even push back from other twitter users based in Saudi Arabia. Even one demanding to know how this twitter user obtained this information. ..."
"... Fifth, the outrage at the German Government and the reports from German businesses that the door to trade has been slammed shut this past month. I attribute this to the one and only exile prince from the Royal family, Saudi Prince Khaled Bin Farhan. living in Europe. He was granted asylum by Germany. There were 3 other exiles but they have been tricked or kidnapped back to Saudi Arabia. This Prince was advocating for the removal of the Crown Prince as recently as March 23, 2018. ..."
"... Sixth, I noticed this week in the news that Crown Prince "MBS" has consolidated his control further this week by taking operational control of the construction and cyber security industries in the country. 35% of the Bin Laden group was basically stolen. I watched an interview of Saudi Prince Alwaleed bin Talal after his release from detention and he was clearly shaken. He was playing a confidence game where everything would go back to normal and mention how the Bin Laden group was back working on his projects. Then this? 35% gone overnight. Cyber security crack down or internet crackdown coming in Saudi Arabia? ..."
"... Seventh, there is no way that MBS approved the recent arrest of the feminist. Not after his carefully cultured PR campaign in the United States. ..."
"... Eight, where's Waldo? ..."
"... Here is my speculation. Al-Qaeda will be the cover story. Crown Prince MBS was killed by members of the Royal Family and other powerful individuals he made enemies with in his short rule. ..."
"... The Royal family members who supported MBS are furious at Germany for the above stated reasons and lashing out in all directions. Threatening to invade Qatar if Russia provides them the S-400. I believe even President Trump's bizarre threat to put huge tariffs on German luxury automobiles because the German public doesn't want to buy crappy American cars like the Chevy Impala is his frustration over one of his essential architects on the plan to change regime's in Iran being eliminated. ..."
"... A lot of torture and indiscriminate arrest is going on at this very moment in Saudi Arabia. The family appears split and trust lost. Time will tell. ..."
"... It would appear that there's no one in charge in SA at the moment. One can now expect a period of confusion, and lots of infighting between various factions trying to assert dominance, or just survive. ..."
"... Considering MbS's policies, I think his exit is better for the Middle East. His tilt of SA policy towards the US and Israel is likely to be reversed. ..."
"... All you need to know is that Mr. Media Roadshow decided overnight to shun video cameras, and not come out for Pompeo. The guy is dead as a door knob. He made way too many enemies during the forced corporate retreat he hosted at the Ritz. ..."
"... myself , i think the attack succeed in wounding and ultimately kill the prince , otherwise why no public appearance at all ? ( if i recall , muslim have to be buried no more than 24 hours after death so that's why i assume he was wounded at first and the medical team failed to keep him alive) ..."
"... In Assad's interview with RT he pointed out that the "opposition" first attacked Syria's air defenses at the beginning of the "civil war". Hillary wanted a "no-fly zone" over Syria. All that's missing is Victoria Nuland. ..."
"... The playground version: The neocons and Netanyahu think they're playing Trump, who in turn thinks he's use them. MbS wanted to be one of the cool kids and tried to get in on the action and might have gotten himself dead in the process. ..."
Re Saudi Arabia: I have previously referred to reports regarding the death of the Saudi Crown
Prince, MbS, as a result of the AQ attack on his palace on April 21. Now, pictures are
circulating of his funeral.
There is so far no official announcement, but that means nothing.
My own hunch is that these reports may well be true. How long can the Saudis (and the
Western media) conceal what has happened?
Agree. There is also the report that he was not at the Graduation Ceremony of the King Abdul
Aziz Military College on May 19. (As Defence Minister, he would have been expected to
attend).
I have been following the story. A few things. Yes, I have seen the pictures of the funeral
and his actual corpse prepared for burial under #mbs at twitter. The pictures are not the
best. The size of the corpse and the nose and receding hairline along with the cheekbones and
body size could definitely be MBS along with the eyes.
Second, I believe the trip by our Secretary of State was in response to the incident
of April 21st. My hunch is the Crown Prince was gravely wounded and later perished at a
Military Hospital.
Third, the night of the incident a twitter user named CivMilAir tracked the Royal
Medevac jet leaving the airport near the gunfire and documented the airplane turning off its
transponder. There was speculation concerning whether or not it was the Crown Prince that
night on that thread. There was even push back from other twitter users based in Saudi
Arabia. Even one demanding to know how this twitter user obtained this information.
Fourth, the recent trip of the Lebanon Prime Minister being called to Saudi Arabia when
his schedule indicated no such trip.
Fifth, the outrage at the German Government and the reports from German businesses
that the door to trade has been slammed shut this past month. I attribute this to the one and
only exile prince from the Royal family, Saudi Prince Khaled Bin Farhan. living in Europe. He
was granted asylum by Germany. There were 3 other exiles but they have been tricked or
kidnapped back to Saudi Arabia. This Prince was advocating for the removal of the Crown
Prince as recently as March 23, 2018.
And he asserted that he receives emails and other forms of communications from disaffected
family members and the security services desiring for a change to be made.
Sixth, I noticed this week in the news that Crown Prince "MBS" has consolidated his
control further this week by taking operational control of the construction and cyber
security industries in the country. 35% of the Bin Laden group was basically stolen. I
watched an interview of Saudi Prince Alwaleed bin Talal after his release from detention and
he was clearly shaken. He was playing a confidence game where everything would go back to
normal and mention how the Bin Laden group was back working on his projects. Then this? 35%
gone overnight. Cyber security crack down or internet crackdown coming in Saudi
Arabia?
Seventh, there is no way that MBS approved the recent arrest of the feminist. Not
after his carefully cultured PR campaign in the United States.
Eight, where's Waldo?
Finally, here is what I find so fascinating. The KIng of Saudi Arabia is reported to have
dementia. Unfortunately, I have a great deal of experience with this dreadful disease. My
stepfather. 16 years. There is no King in charge of Saudi Arabia. In fact, if MBS was killed
like I believe there is no legitimate line to the next ruler. Survival of the Fittest.
Here is my speculation. Al-Qaeda will be the cover story. Crown Prince MBS was killed
by members of the Royal Family and other powerful individuals he made enemies with in his
short rule.
The Royal family members who supported MBS are furious at Germany for the above stated
reasons and lashing out in all directions. Threatening to invade Qatar if Russia provides
them the S-400. I believe even President Trump's bizarre threat to put huge tariffs on German
luxury automobiles because the German public doesn't want to buy crappy American cars like
the Chevy Impala is his frustration over one of his essential architects on the plan to
change regime's in Iran being eliminated.
A lot of torture and indiscriminate arrest is going on at this very moment in Saudi
Arabia. The family appears split and trust lost. Time will tell.
Thank you for that excellent rundown of events. I tend to agree with your "speculation".
It would appear that there's no one in charge in SA at the moment. One can now expect
a period of confusion, and lots of infighting between various factions trying to assert
dominance, or just survive.
Considering MbS's policies, I think his exit is better for the Middle East. His tilt of SA
policy towards the US and Israel is likely to be reversed.
All you need to know is that Mr. Media Roadshow decided overnight to shun video cameras,
and not come out for Pompeo. The guy is dead as a door knob. He made way too many enemies
during the forced corporate retreat he hosted at the Ritz.
This is news to me. How big do you think the resulting power struggle would be if MbS was
killed or incapacitated? I can envision outcomes that range from 2nd page news all the way up
to Archduke Ferdinand grade but I don't have any feel for the probabilities.
If true, would it cause you to see the events of the last month in the region in a
different light?
With MBS dead, how will Saudi react to MBS's previous Israel's right to exist scenario,
along with Jerusalem being declared Israel's capital and the embassy move by DT?
How much longer will the Saudi and international press be able to remain silent on
this?
Who do you think will now ascend the Saudi throne as heir apparent?
FB Ali , sir , it is so hard to get info in the AQ Attack that allegedly mortally wound MBS..
as for the shooting reported as a wayward drone , i recall this video (anyone can confirm the
skyline if this is saudi city near palace ?) , the gunfire last for long time , far too long
to be guards firing on a drone.
myself , i think the attack succeed in wounding and ultimately kill the prince ,
otherwise why no public appearance at all ? ( if i recall , muslim have to be buried no more
than 24 hours after death so that's why i assume he was wounded at first and the medical team
failed to keep him alive)
do you think this is the 'blowback' from the massive shakedown that the prince did to his
seniors ?
Has DT done a single thing that has helped Israel? I would say no. In Assad's interview
with RT he pointed out that the "opposition" first attacked Syria's air defenses at the
beginning of the "civil war". Hillary wanted a "no-fly zone" over Syria. All that's missing
is Victoria Nuland.
Your post vividly depicts how isolated Israel has become. I reiterate DT has done nothing
to help Israel and everything to harm it. One is permitted to ask what's going on.
The playground version: The neocons and Netanyahu think they're playing Trump, who in turn
thinks he's use them. MbS wanted to be one of the cool kids and tried to get in on the action
and might have gotten himself dead in the process.
All the while Putin and the SCO crew wait
and play for time as they tangle each other up into an ever larger mess of their own making
hoping to avoid, or minimize, whatever conflict is necessary to get them all to accept the
coming multi-polar world order.
Perhaps in the future when they make a movie about this period it will be called "A Deal
Too Far".
Also "However, a week after the coup speculations, the Crown Prince, along with Saudi King
Salman, was seen at the opening ceremony of a huge entertainment resort Qiddiya – an
ambitious multi-billion dollar project that is expected to include a Six Flags theme park,
water parks, motor sports, cultural events and vacation homes." Sputnik
International
Saudi Arabia's Crown Prince Mohammed Bin Salman, the 32-year-old
media-savvy leader of the oil kingdom, has been unnaturally quiet recently, so much so
that some in the Middle East media couldn't help but wonder if he is dead.
Bin Salman hasn't been seen in the public eye since his meeting with the Spanish royal
family in on April 12. On April 21, heavy gunfire was heard near a royal palace in Riyadh,
the kingdom's capital. Although Saudi Arabia's state news agency claimed it was a security
force
shooting down a toy drone that had gotten too close to the royal property, some wondered
if the gunfire was in fact a coup led by Saudi royals trying to topple King Salman, Bin
Salman's father.
Some of Saudi Arabia's enemies were pretty sure.
Last week, the
Iranian
newspaper Kayhan reported that the Crown Prince was hit by two bullets during
the attack and may actually be dead, citing "a secret service report sent to the senior
officials of an unnamed Arab state."
"There is plenty of evidence to suggest that the absence of nearly 30 days of Muhammad bin
Salman, the Crown Prince of Saudi Arabia, is due to an incident which is being hidden from
the public," the daily paper claimed.
To add credence to the speculation, Kayhan pointed out that Bin Salman was not
seen on camera when the new U.S. Secretary of State Mike Pompeo visited Riyadh in late April,
while his father, Saudi King Salman bin Abdulaziz Al Saud, and Foreign Minister Adel
al-Jubeir were photographed.
"... By Irina Slav, a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry. Originally published at OilPrice ..."
By Irina Slav, a writer for the U.S.-based Divergente LLC consulting firm with over a
decade of experience writing on the oil and gas industry. Originally published at OilPrice
"I personally think none of us will be able to get around it," Vitol's chief executive Ian
Taylor
said last week, commenting on the effects that renewed U.S. sanctions against Iran will
have on the oil industry.
The sanctions, to go into effect later in the year, have already started to bite. French
Total, for one,
announced earlier this month it will suspend all work on the South Pars gas field unless it
receives a waiver from the U.S. Treasury Department -- something rather unlikely to happen. The
French company has a lot of business in the United States and cannot afford to lose its access
to the U.S. financial system. So, unless the EU strikes back at Washington and somehow manages
to snag a waiver for its largest oil company, Total will be pulling out of Iran.
Other supermajors have not dared enter the country, so there will be no other pullouts of
producers, but related industries will be affected, too, in the absence of a strong EU reaction
to the sanctions. For example, Boeing and Airbus will both have their licenses for doing
business in Iran revoked, Treasury Secretary Steven Mnuchin said , which
will cost them some US$40 billion -- the combined value of contracts that the two aircraft
makers had won in Iran.
Tanker owners are also taking the cautious approach. They are watching the situation
closely, anticipating Europe's move, but acknowledging that the reinstatement could have
"significant ramifications" for the maritime transport industry, as per the
International Group of PI & Clubs, which insures 90 percent of the global tanker fleet.
Everyone is waiting for Europe to make its move even as European companies in Iran are
beginning
to prepare their exit from the country. Everyone remembers the previous sanctions, apparently,
and they don't want to be caught off guard. But the signals from Europe are for now positive
for these companies, of which there are more
than a hundred .
Earlier this month, an adviser to French President Emmanuel Macron
said that Europe's response to the thread of U.S. sanctions on Iran will be "an important
test of sovereignty." Indeed, unlike the last time there were sanctions against Iran, the
European Union did all it could to save the nuclear deal and has signaled it will continue to
uphold it.
While some doubt there is a lot the EU can do against U.S. sanctions, there is one 1996 law
dubbed a blocking statute that will ban European companies from complying with U.S. sanctions,
which would put companies such as Total between a rock and a hard place.
European Commission President Jean-Claude Juncker
said two weeks ago the commission will amend the statute to include the U.S. sanctions
again Iran and that the amendments should be completed before the first round of sanctions
kicks in in early August.
Many observers believe that if the sanctions are only limited to the U.S. and no other
signatory to the nuclear deal joins them, the effect will be limited as well. As McKinsey
analyst Elif Kutsal
told Rigzone, "Market fundamentals are not expected to change structurally given that Iran
doesn't export crude oil or refined products to the U.S. and exports go mainly to Europe (20
percent) and Asia Pacific (80 percent). Therefore, if the sanctions are only limited to the
United States, then this could cause short-term volatility in prices until a new/revised
agreement framework is put in place."
And this is where Iran's Supreme Leader Ayatollah Ali Khamenei scored a goal: He demanded
that the European Union provide guarantees it will continue to buy Iranian crude. If it
doesn't, he said, Iran will restart its nuclear program. Now, if this happens, the EU will not
have much choice but to join the sanctions, and then hundreds of thousands of barrels of
Iranian crude could be cut off from global markets.
However, even this will result in only a temporary decline in supplies, according to Kutsal,
and others that believe that Asian imports from Iran will offset the effect from the U.S.
sanctions. According to this camp, the only thing that can unleash the full effect of sanctions
is the UN joining the sanction push against Iran.
They gave Obama their tepid approval, then poured millions into a three-year campaign to kill it -- and won.
By William D. Hartung and Ben Freeman
• Benjamin Netanyahu's April 30
presentation accusing Iran of lying about its nuclear program was clearly aimed at a Western audience, and at one man in particular
-- Donald Trump. Trump was already inclined to violate and exit the multi-party deal to block Iran's path to a nuclear weapon, but
Netanyahu's presentation offered a timely addition to the administration's rhetorical arsenal. His PowerPoint performance, filled
with misleading assertions and
stale information dressed up as new revelations, was referenced by Trump as part of the justification for abandoning the nuclear
deal.
While this garnered headlines, another U.S. ally -- Saudi Arabia -- had been orchestrating a quieter but equally effective lobbying
and public relations push to dismantle the deal. The Saudis' arguments were used just as much, if not more, by Trump in justifying
his decision for the U.S. to walk away from a carefully crafted agreement that even some of his own military leaders had
acknowledged was working.
The Saudi lobby's push began long before the Joint Comprehensive Plan of Action (JCPOA) was formally announced on July 14, 2015.
In fact, Saudi lobbyists had been working behind the scenes in the U.S. for years to ensure that the Kingdom's concerns were incorporated
into any deal Washington would agree to with Iran -- if there was to be a deal at all.
In total, the Christian Science Monitor
found that Saudi Arabia spent $11 million dollars on Foreign Agents Registration Act (FARA)-registered firms in 2015, and "much
of this spending relates to Iran." They were also assembling former policymakers like Senator Norm Coleman, whose FARA
disclosure mentions his work on "limiting
Iranian nuclear capability." More recently, Coleman penned an op-ed in The Hill applauding Trump for leaving the deal
without disclosing
that he was being paid by the Saudi government.
Despite their strong opposition to any deal with Iran, however, many of the Saudis' concerns were ultimately addressed by the
JCPOA, specifically their demands that "snapback" provisions be incorporated to quickly reinstitute sanctions if Iran violated the
agreement and that inspectors have access to military and other suspect sites. Above all, the Saudis wanted an assurance that the
deal would prevent Iran from acquiring a nuclear weapon. The agreement provided this and President Obama
guaranteed it. This led to what many had thought impossible --
Saudi Arabia supporting
the Iran deal . Obama sealed the grudging support of Saudi Arabia and other Gulf States in a May 2015 meeting at Camp David where
he offered "reassurances" that the deal would not jeopardize their security, underscored by a
promise to sell them even more weaponry.
But Saudi support for the deal was tepid and ephemeral at best. While publicly supporting it, the Saudis and their lobbyists in
D.C. were quietly working to undermine it. Their arguments largely centered on two points: that the funds freed up by the deal would
underwrite Iran's continued support for terrorist groups, and that the deal would do nothing to halt Iran's ballistic missile program.
While more than two dozen D.C. lobbying and public relations firms working for Saudi interests have registered under FARA since
the U.S. agreed to the Iran deal, none has been more aggressively pushing these anti-Iran talking points than the MSLGroup (which
acquired long-serving Saudi client Qorvis Communications in 2014). The MSLGroup, which has been paid more than
$6 million dollars by the Saudis
just since the U.S. agreed to the Iran deal, has distributed a variety of "informational materials" (formerly called
propaganda ) on each of
these topics, including a five-page fact sheet on "
Iranian Aggression in Yemen ,"
and a press release on Iran being the "
biggest state sponsor of terrorism
," among many others. And of course, the MSLGroup wasn't alone in spreading anti-Iran propaganda on behalf of the Saudi regime. For
example, as recently as March 2018, the Glover Park Group distributed information on Iran's "region," and Hogan Lovells distributed
" facts about the Houthis and Iran
," with a section on Iran's ballistic missiles.
With these talking points in hand, the Saudis saw an opportunity in the election of the neophyte Donald Trump to up the ante on
Iran, and they invested heavily in
courting him. Their efforts paid off handsomely as Trump made his first overseas visit to the Kingdom of Saudi Arabia, initially
supported them in their spat with Qatar (until he learned the U.S. has a rather large military base in Qatar), kept U.S. military
support and bombs flowing for a Saudi-led campaign in Yemen that has cost more than
10,000 civilians
their lives, and agreed to sell them billions of dollars in additional U.S. weaponry of all sorts, from more munitions to a costly
missile defense system. But Saudi Arabia still wanted more -- they wanted the U.S. out of the Iran deal.
While Saudi Arabia's most unlikely ally in this cause, Israel, took a very outspoken approach to move the president, which culminated
in Netanyahu's misleading presentation, the Saudis used their well-financed lobbying machine to disseminate their message into the
D.C. bloodstream. Their primary talking points found their way to the president's ears and became routine features of his justification
for abandoning the deal. The White House
statement justifying leaving the Iran deal is littered with Saudi lobby talking points, including that "The JCPOA failed to deal
with the threat of Iran's missile program," and Iran "continues to fund terrorist proxies In Yemen, the regime has escalated the
conflict and used the Houthis as a proxy to attack other nations." The president's
remarks on the day he announced that the U.S. was abandoning the deal are also rife with language that could easily have been
lifted from a Saudi-financed "fact sheet." In fact, Trump's second sentence, "the Iranian regime is the leading state sponsor of
terrorism," is nearly verbatim off of an anti-Iran
talking point distributed by
the MSLGroup.
Why did the Saudis want the U.S. to abandon the Iran deal? A New York Timesanalysis
identified what is probably the primary reason -- a fear that the deal would be the first step towards a U.S. rapprochement with
Iran that would undermine the Saudi regime's power in the region in general and its campaign against Iran in particular. "Exiting
the deal, with or without a plan, is fine with the Saudis," the Times wrote. "They see the accord as a dangerous distraction
from the real problem of confronting Iran around the region -- a problem that Saudi Arabia believes will be solved only by leadership
change in Iran."
Former State Department official Jeremy Shapiro
underscored
this point when he noted that the Saudis and their Gulf allies "believe they are in this existential conflict with the Iranian regime,
and nuclear weapons are a small part of that conflict . If the deal opened an avenue for better relations between the United States
and Iran, that would be a disaster for the Saudis," he said. "They need to ensure a motivation for American pressure against Iran
that will last even after this administration."
One disquieting outcome of the trashing of the Iran nuclear deal is that Saudi Arabia has threatened to acquire a nuclear weapon
of its own if the end of the agreement leads Iran to revive its program. This is not the first time Saudi leaders have made such
threats. Just after Trump announced the U.S. would be leaving the deal, the Saudi foreign minister
said that if Iran now builds a nuclear weapon his country "will do everything we can" to follow suit. So on top of its implications
for increased conventional conflict in the region, the end of U.S. participation in the Iran deal could spark a nuclear arms race
in the Middle East -- an outcome that would have been far less likely if U.S. participation in the Iran deal had been maintained.
The potential for a Mideast nuclear arms race is yet another example of the disastrous consequences of Saudi Crown Prince Mohammed
bin Salman's reckless foreign policy, which includes everything from his regime's brutal, counterproductive intervention in Yemen,
to the Saudi-led effort to impose a blockade on Qatar, to its promotion of regime change in Iran -- preferably carried out by the
United States.
In the wake of the U.S. pullout from the Iran deal, we can expect the Saudi lobby, working in concert with administration allies
ranging from Jared Kushner to newly appointed national security advisor John Bolton, to double down in its efforts to promote these
ill-advised, dangerous directions for U.S. foreign policy in the region. Countering Riyadh's blatant influence peddling should be
part of an expanded effort to distance the United States from its increasingly risky, counterproductive relationship with Saudi Arabia.
If Mohammed bin Salman's aggressive policies -- and Saudi advocacy for them in Washington -- continue, Riyadh is one "friend" the
United States should consider doing without.
William D. Hartung is the director of the Arms and Security Project at the Center for International Policy, and Ben Freeman
directs the Center's Foreign Influence Transparency Initiative.
One and a half years after Russia and Turkey signed a deal to build the strategic "Turkish
Stream" gas
pipeline in October 2016 , putting an end to a highly contentious period in Russia-Turkish
relation which in late 2015 hit rock bottom after the NATO-member state shot down a Russian jet
over Syria, on Saturday Russian state energy giant Gazprom and the Turkish government
reached a deal on the construction of the land-based part of the Turkish Stream branch that
will bring Russian gas to European consumers.
According
to Reuters , the two counterparts signed a protocol that would allow the construction,
which was stalled by a legal rift over gas prices, to go forward. Gazprom and Turkey's
state-owned BOTAS agreed on the terms and conditions of the project, Gazprom said in a statement ,
adding that the deal "allows to move to practical steps for the implementation of the project."
The actual construction would be carried out by a joint venture called TurkAkim Gaz Tasima
which will be owned by Gazprom and BOTAS in equal shares, Gazprom said.
Earlier on Saturday, Turkish president Erdogan said that Gazprom and BOTAS resolved a
long-running legal dispute over import prices in 2015-2016, and as a result Turkey would gain
$1 billion as part of the gas-price settlement reached with Gazprom, in which Turkey and the
Russian natgas giant agreed on a 10.25% price discount for gas supplied by Russia in 2015 and
2016.
"We agreed on a 10.25% reduction in the price of natural gas in 2015-2016," Erdogan
announced while speaking at a rally on Saturday. "We got our discount. We get about $ 1 billion
worth of our rights before the election," the Turkish President said, as cited by Anadolu
Agency.
BOTAS had refused to approve the building of the land-based part of the pipeline until the
import price issue was resolved. Until now, it only permitted Gazprom to construct the undersea
part of the line. The construction is currently underway.
Russia and Turkey officially agreed on the project, which consists of two branches, in
October 2016. The first branch will deliver gas to Turkish consumers, while the second one will
bring it to the countries in southern and south-western Europe. The European leg is expected to
decrease Russia's dependence on transit through Ukraine. Each of the lines has a maximum
capacity of 15.75 billion cubic meters a year.
Gazprom finished the construction of the deep-water part of the first line of the Turkish
Stream in April. The first Russian gas could start flowing through both legs of the Turkish
Stream by December 2019.
The greenlighting of the Turkish Stream project is sure to infuriate the US which previously
announced it was
considering sanctions of European firms that would participate in the Nothern Stream
Russian gas pipeline.
President Trump went as far as to threaten
Angela Merkel two weeks ago , telling her to either drop the Russian gas pipeline or the
trade war with the US was set to begin.
How Europe reacts to US threats involving the Northern Stream and, soon, the Turkish Stream,
will determine whether Europe will once again find itself a subservient vassal state to US
military and energy lobbying powers, or if Brussels will side with Putin in this growing
conflict, resulting in an unprecedented breach within the so-called " democratic west. "
[May 27, 2018] Turning on Russia by Paul Fitzgerald and Elizabeth Gould
"... Coming Next, Part 2: The post WWII global strategy of the neocons has been shaped chiefly by Russophobia against the Soviet Union and now Russia ..."
"... * Paul Fitzgerald and Elizabeth Gould are the authors of Invisible History: Afghanistan's Untold Story , Crossing Zero The AfPak War at the Turning Point of American Empire and The Voice . Visit their websites at invisiblehistory and grailwerk .com ..."
In this first of a two-part series, Paul Fitzgerald and Elizabeth Gould trace the origins
of the neoconservative targeting of Russia.
By Paul Fitzgerald and Elizabeth Gould April 29.2018
The German newsmagazine Der Spiegel last September reported
that, "Stanley Fischer, the 73–year-old vice chair of the U.S. Federal Reserve, is
familiar with the decline of the world's rich. He spent his childhood and youth in the British
protectorate of Rhodesia before going to London in the early 1960s for his university studies.
There, he experienced first-hand the unravelling of the British Empire Now an American citizen,
Fischer is currently witnessing another major power taking its leave of the world stage the
United States is losing its status as a global hegemonic power, he said recently. The U.S.
political system could take the world in a very dangerous direction "
With the collapse of the Soviet Union in 1991 and the creation of the so called Wolfowitz
Doctrine in 1992 during the administration of George Herbert Walker Bush, the United States
claimed the mantle of the world's first and only. Unipower with the intention of crushing any
nation or system that would oppose it in the future. The New World Order, foreseen just a few
short years ago, becomes more disorderly by the day, made worse by varying degrees of
incompetence and greed emanating from Berlin, London, Paris and Washington.
As a further sign of the ongoing seismic shocks rocking America's claim to leadership, by
the time Fischer's interview appeared in the online version of the Der Spiegel , he had
already announced his resignation as vice chair of the Federal Reserve -- eight months ahead of
schedule. If anyone knows about the decline and fall of empires it is the "globalist" and
former Bank of Israel president, Stanley Fischer. Not only did he experience the unravelling of
the British Empire as a young student in London, he directly assisted in the wholesale
dismantling of the Soviet Empire during the 1990s.
As an admitted product of the British Empire and point man for its long term imperial aims,
that makes Fischer not just empire's Angel of Death, but its rag and bone man.
Alongside a handful of Harvard economists led by Jonathan Hay, Larry Summers, Andrei
Shleifer, and Jeffry Sachs, in the "Harvard Project," plus Anatoly Chubais, the chief Russian
economic adviser, Fischer helped throw 100 million Russians into poverty overnight –
privatizing, or as some would say piratizing – the Russian economy. Yet, Americans never
got the real story because a slanted anti-Russia narrative covered the true nature of the
robbery from beginning to end.
As described by public policy scholar and anthropologist Janine R. Wedel in her 2009 book
Shadow Elite: "Presented in the West as a fight between enlightenment Reformers trying
to move the economy forward through privatization, and retrograde Luddites who opposed them,
this story misrepresented the facts. The idea or goal of privatization was not controversial,
even among communists the Russian Supreme Soviet, a communist body, passed two laws laying the
groundwork for privatization. Opposition to privatization was rooted not in the idea itself but
in the particular privatization program that was implemented, the opaque way in which it
was put into place, and the use of executive authority to bypass the parliament."
Intentionally set up to fail for Russia and the Russian people under the cover of a false
narrative, she continues "The outcome rendered privatization 'a de facto fraud,' as one
economist put it, and the parliamentary committee that had judged the Chubais scheme to 'offer
fertile ground for criminal activity' was proven right."
If Fischer, a man who helped bring about a de facto criminal-privatization-fraud to
post-empire Russia says the U.S. is on a dangerous course, the time has arrived for post-empire
Americans to ask what role he played in putting the U.S. on that dangerous course. Little known
to Americans is the blunt force trauma Fischer and the "prestigious" Harvard Project delivered
to Russia under the leadership of Boris Yeltsin during the 1990s. According to The American Conservative's James Carden "As the Center for Economic and Policy
Research noted back in 2011 'the IMF's intervention in Russia during Fischer's tenure led to
one of the worst losses in output in history, in the absence of war or natural disaster.'
Indeed, one Russian observer compared the economic and social consequences of the IMF's
intervention to what one would see in the aftermath of a medium-level nuclear attack."
Neither do most Americans know that it was President Jimmy Carter's national security
advisor Zbigniew Brzezinski's 1970s grand plan for the conquest of the Eurasian heartland that
boomeranged to terrorize Europe and America in the 21 st century. Brzezinski spent
much of his life undermining the Communist Soviet Union and then spent the rest of it worrying
about its resurgence as a Czarist empire under Vladimir Putin. It might be unfair to say that
hating Russia was his only obsession. But a common inside joke during his tenure as the
President's top national security officer was that he couldn't find Nicaragua on a map.
If anyone provided the blueprint for the United States to rule in a unipolar world following
the Soviet Union's collapse it was Brzezinski. And if anyone could be said to represent the
debt driven financial system that fueled America's post-Vietnam Imperialism, it's Fischer. His
departure should have sent a chill down every neoconservative's spine. Their dream of a New
World Order has once again ground to a halt at the gates of Moscow.
Whenever the epitaph for the abbreviated American century is written it will be sure to
feature the iconic role the neoconservatives played in hastening its demise. From the chaos
created by Vietnam they set to work restructuring American politics, finance and foreign policy
to their own purposes. Dominated at the beginning by Zionists and Trotskyists, but directed by
the Anglo/American establishment and their intelligence elites, the neoconservatives' goal,
working with their Chicago School neoliberal partners, was to deconstruct the nation-state
through cultural co-optation and financial subversion and to project American power abroad. So
far they have been overwhelmingly successful to the detriment of much of the
world.
From the end of the Second World War through the 1980s the focus of this pursuit was on the
Soviet Union, but since the Soviet collapse in 1991, their focus has been on dismantling any
and all opposition to their global dominion.
Pentagon Capitalism
Shady finance, imperial misadventures and neoconservatism go hand in hand. The CIA's
founders saw themselves as partners in this enterprise and the defense industry welcomed them
with open arms. McGill University economist R.T. Naylor, author of 1987's Hot Money and the
Politics of Debt , described how "Pentagon Capitalism" had made the Vietnam War
possible by selling the Pentagon's debt to the rest of the world.
"In effect, the US Marines had replaced Meyer Lansky's couriers , and the European central
banks arranged the 'loan-back,'" Naylor writes. "When the mechanism was explained to the late
[neoconservative] Herman Kahn – lifeguard of the era's chief 'think tank' and a man who
popularized the notion it was possible to emerge smiling from a global conflagration – he
reacted with visible delight. Kahn exclaimed excitedly, 'We've pulled off the biggest ripoff in
history! We've run rings around the British Empire.'" In addition to their core of
ex-Trotskyist intellectuals early neoconservatives could count among their ranks such
establishment figures as James Burnham, father of the Cold War Paul Nitze, Senator Daniel
Patrick Moynihan, Senator Henry "Scoop" Jackson, Jeane Kirkpatrick and Brzezinski himself.
From the beginning of their entry into the American political mainstream in the 1970s it was
known that their emergence could imperil democracy in America and yet Washington's more
moderate gatekeepers allowed them in without much of a fight.
Peter Steinfels' 1979 classic The
Neoconservatives: The men who are changing America's politics begins with these fateful
words. "THE PREMISES OF THIS BOOK are simple. First, that a distinct and powerful political
outlook has recently emerged in the United States. Second, that this outlook, preoccupied with
certain aspects of American life and blind or complacent towards others, justifies a politics
which, should it prevail, threatens to attenuate and diminish the promise of American
democracy."
But long before Steinfels' 1979 account, the neoconservative's agenda of inserting their own
interests ahead of America's was well underway, attenuating U.S. democracy, undermining
détente and angering America's NATO partners that supported it. According to the
distinguished State Department Soviet specialist Raymond Garthoff, détente had been
under attack by right-wing and military-industrial forces ( led by Senator "Scoop"
Jackson ) from its inception. But America's ownership of that policy underwent a shift
following U.S. intervention on behalf of Israel during the 1973 October war. Garthoff writes in
his detailed volume on American-Soviet relations Détente
and Confrontation , "To the allies the threat [to Israel] did not come from the Soviet
Union, but from unwise actions by the United States, taken unilaterally and without
consultation. The airlift [of arms] had been bad enough. The U.S. military alert of its forces
in Europe was too much."
In addition to the crippling Arab oil embargo that followed, the crisis of confidence in
U.S. decision-making nearly produced a mutiny within NATO. Garthoff continues, "The United
States had used the alert to convert an Arab-Israeli conflict, into which the United States had
plunged, into a matter of East-West confrontation. Then it had used that tension as an excuse
to demand that Europe subordinate its own policies to a manipulative American diplomatic gamble
over which they had no control and to which they had not even been privy, all in the name of
alliance unity."
In the end the U.S. found common cause with its Cold War Soviet enemy by imposing a
cease-fire accepted by both Egypt and Israel thereby confirming the usefulness of
détente. But as related by Garthoff this success triggered an even greater effort by
Israel's "politically significant supporters" in the U.S. to begin opposing any
cooperation with the Soviet Union, at all.
Garthoff writes, "The United States had pressed Israel into doing precisely what the Soviet
Union (as well as the United States) had wanted: to halt its advance short of complete
encirclement of the Egyptian Third Army east of Suez Thus they [Israel's politically
significant supporters] saw the convergence of American-Soviet interests and effective
cooperation in imposing a cease-fire as a harbinger of greater future cooperation by the two
superpowers in working toward a resolution of the Israeli-Arab-Palestinian problem."
Qatar's foreign minister reacted publicly on Thursday to the recent wave of visits by
leaders of U.S. Jewish organizations to his country at the invitation of the ruling
Emir.
It seems the Qataris have figured out the best way to influence American foreign policy is to
appeal to the real power brokers in the U.S..
Doha wants to influence D.C. elites. But rather than targeting Congress or the media,
they're lavishly, and disproportionately, focusing on right-wing, pro-Israel Jews
One demand which the Qataris immediately acceded to was the suppression of the al Jezeera
expose on the jewish lobby in American politics.
Two extraordinary events have come together to place Al Jazeera in a vise-like squeeze
that may result in the death of a major TV documentary expose about the power and operations of
the Israel Lobby in the U.S. The same investigative team ... created the remarkable four-part
film, The Lobby, about the UK Israel Lobby.
and
The new documentary follows a similar script. Al Jazeera recruited someone to infiltrate
various Lobby organizations based in Washington...
and
...Haaretz published a story acknowledging that almost all of these American Jewish supplicants
came to Qatar for one very special reason (there may have been others, but this one was key).
They wanted the Al Jazeera documentary killed. They knew if it was aired it would make them
look as shabby, venal, and crude as the UK series did.
Posted by: pantaraxia | May 22, 2018 11:03:42 AM |
6
What happens when a country decides to decouple itself from the US/Saudi axis of evilglobinfo
freexchange
T he role of Qatar and Saudi Arabia in the Middle East chaos is quite well known . Recall that
in a letter
of the Podesta email series, John Podesta admitted that both Qatar and Saudi Arabia we re
helping ISIS. Podesta also mentioned that the US should exercise pressure to these countries in
order to stop doing it: " ... we need to use our diplomatic and more traditional
intelligence assets to bring pressure on the governments of Qatar and Saudi Arabia, which are
providing clandestine financial and logistic support to ISIL and other radical Sunni groups in
the region. "
Of course Hillary Clinton wouldn't do anything about this problem too, as in another
letter of the Podesta email series, it was revealed that Bill Clinton was receiving
"expensive gifts" from the Qataris!
As reported by Antimedia , in 2009 Qatar
proposed a pipeline to run through Syria and Turkey to export Saudi gas. Assad rejected the
proposal and instead formed an agreement with Iran and Iraq to construct a pipeline to the
European market that would cut Turkey, Saudi Arabia, and Qatar out of the route entirely.
Since, Turkey, Qatar, and Saudi Arabia have been staunch backers of the opposition seeking to
topple Assad. Collectively, they have invested billions of dollars, lent weapons, encouraged
the spread of fanatical ideology, and helped smuggle fighters across their borders.
The Iran-Iraq pipeline will strengthen Iranian influence in the region and undermine their
rival, Saudi Arabia -- the other main OPEC producer. Given the ability to transport gas to
Europe without going through Washington's allies, Iran will hold the upper-hand and will be
able to negotiate agreements that exclude the U.S. dollar completely.
Yet, less than a year ago, a crisis erupted between 'unholy' allies, apparently because Qatar
has chosen to change camp and proceed into a deeper approach with Iran.
As reported by Guardian , Saudi Arabia and its allies have issued a threatening 13-point
ultimatum to Qatar as the price for lifting a two-week trade and diplomatic embargo of the
country, in a marked escalation of the Gulf's worst diplomatic dispute in decades. The onerous
list of demands includes stipulations that Doha close the broadcaster al-Jazeera,
drastically scale back cooperation with Iran , remove Turkish troops from Qatar's soil,
end contact with groups such as the Muslim Brotherhood and submit to monthly external
compliance checks. Qatar has been given 10 days to comply with the demands or face unspecified
consequences.
Then, apparently, Rex
Tillerson tried to persuade Qatar to stay in the unholy alliance and move away from
Iran a day after wrapping up discussions with the king of Saudi Arabia and other officials from
Arab countries lined up against Qatar.
We can tell now that Qatar has not changed stance and chosen to continue its approach with the
winning alliance in the Syrian battlefield. We have the first signs showing that the US empire
and its allies in the Middle East will move against Qatar, beginning with a typical first step:
propaganda war.
A Pentagon "propagandist," who previously headed a company that was paid half a billion dollars
to produce fake terrorist videos in Iraq, was hired by a Dubai based company to create a film accusing Qatar of links to terrorism , the Bureau of
Investigative Journalism has revealed.
Charles Andreae, the CEO of Andreae & Associates which was contracted to produce the film,
used to work for PR firm Bell Pottinger, the UK PR firm that was payed $540 million dollars to
create fake terrorist videos in Iraq.
The firm was employed to produce the anti-Qatari film amidst a diplomatic row in which the
Saudi and UAE governments cut ties with Doha, which it accused of supporting terrorism. Qatar
has strongly denied the accusation and accused its neighbours of fabricating stories. US
intelligence agencies have since confirmed that the UAE orchestrated the hacking of Qatari
government news and social media sites to justify its unprecedented attack against Qatar.
According to the Bureau, Andreae was given over $500,000 to produce a six-part film linking
Qatar with global terrorism. The film, entitled "Qatar: A Dangerous Alliance," features a
number of neo-conservative pundits making the UAE and Saudi case against Qatar in a 37-minute
video.
Washington's double standards and hypocrisy are quite evident in this case too. After this
crisis between allies erupted, a number of US officials immediately launched a series of
statements through which they depicted Qatar as the sole supporter of terrorist groups in the
Middle East. Again, Saudi Arabia, the most authoritarian regime in the region and probably the
biggest supporter of jihadist extremists, was miraculously vanished from their radar and,
naturally, the radar of the Western corporate media.
In case Qatar will not compromise and keep walking the path towards decoupling itself from the
US/Saudi axis of evil, the next steps will be a new series of upgraded, Iranian-type sanctions,
or even a military invasion as the last option. The only thing that can save Qatar for now is
the fact that it hosts the largest US military base in the Middle East .
The Saudi defense ministry announced in a statement on Sunday that Riyadh ruler Faisal bin
Bandar bin Abdolaziz has attended the ceremony instead of bin Salman.
The statement declined to comment on the reason of bin Salman's absence while naturally the
defense minister should participate in such ceremonies.
He didn't appear for any of the Ramadan events either, which is very odd."
Notable quotes:
"... A growing number of videos surfaced the media at the time displaying that a heavy gunfire erupted around King Salman bin Abdulaziz Al Saud's palace in the capital, Riyadh. ..."
"... Witnesses and residents of the neighborhoods near the palace said a coup was underway, adding that the soldiers attacking the palace were guided by footage and intel they were receiving from a drone flying over the palace. ..."
"... Saudi opposition members claimed that "a senior ground force officer has led a raid on the palace to kill the king and the crown prince". ..."
"... Saudi Arabia, the world's top oil exporter, has witnessed a series of radical political changes over the past year as Mohammed bin Salman ousted his cousin as crown prince and jailed well-known princes in an anti-corruption purge. ..."
"... Moreover, bin Salman oversees social and economic reforms that have been censured by several powerful Wahhabi clerics. ..."
"... Notably, bin Salman made no media appearance during the April 28 visit of the newly-appointed US State Secretary Mike Pompeo to Riyadh, his first foreign trip as the top US diplomat. ..."
"... During his stay in Riyadh, Saudi media outlets published images of Pompeo's meetings with King Salman and Foreign Minister Adel al-Jubeir. ..."
According to the Persian-language newspaper, Keyhan, a secret service report sent to the
senior officials of an unnamed Arab state disclosed that bin Salman has been hit by two bullets
during the April 21 attack on his palace, adding that he might well be dead as he has never
appeared in the public ever since.
Heavy gunfire was heard near the Saudi King's palace in Riyadh Saudi Arabia on April 21,
while King Salman was taken to a US bunker at an airbase in the city.
A growing number of videos surfaced the media at the time displaying that a heavy
gunfire erupted around King Salman bin Abdulaziz Al Saud's palace in the capital,
Riyadh.
Reports said the king and his son, Crown Prince Mohammed bin Salman, were evacuated to a
bunker at an airbase in the city that is under the protection of the US troops.
While Saudi officials and media were quiet over the incident, there were contradicting
reports over the incident. Witnesses and residents of the neighborhoods near the palace
said a coup was underway, adding that the soldiers attacking the palace were guided by footage
and intel they were receiving from a drone flying over the palace.
Saudi opposition members claimed that "a senior ground force officer has led a raid on
the palace to kill the king and the crown prince".
Videos also showed that a growing number of armored vehicles were deployed around the
palace. 'Bin Salman's special guard' then took charge of security in the capital. Riyadh's sky
was then closed to all civil and military flights as military helicopters from 'Bin Salman's
special guard' were flying over the palace.
Bin Salman was a man who previously often appeared before the media but his 27-day absence
since the gunfire in Riyadh has raised questions about his health.
Saudi Arabia, the world's top oil exporter, has witnessed a series of radical political
changes over the past year as Mohammed bin Salman ousted his cousin as crown prince and jailed
well-known princes in an anti-corruption purge.
Moreover, bin Salman oversees social and economic reforms that have been censured by
several powerful Wahhabi clerics.
Saudi Arabia is also embroiled in a long running conflict in its Southern neighbor Yemen,
dubbed by the United Nations as the world's worst humanitarian crisis.
Notably, bin Salman made no media appearance during the April 28 visit of the
newly-appointed US State Secretary Mike Pompeo to Riyadh, his first foreign trip as the top US
diplomat.
During his stay in Riyadh, Saudi media outlets published images of Pompeo's meetings
with King Salman and Foreign Minister Adel al-Jubeir.
This is while the state-run outlets used to publish images of meetings in Riyadh between bin
Salman and former US secretary of state Rex Tillerson.
A few days after the April 21 incident, Saudi media published footage and images of bin
Salman meeting several Saudi and foreign officials. But the date of the meetings could not be
verified, so the release of the videos could be aimed at dispelling rumors about bin Salman's
conditions.
It is not clear if bin Salman's disappearance is due to reasons such as him feeling
threatened or being injured in the incident.
It has been almost a month since Saudi Crown Prince Mohamed bin
Salman made a public appearance, triggering questions whether the April 21 incidents at the
Royal Palace had a role in his disappearance.
Several reports claimed that the security incident in April, what Saudi officials said was a
result of a recreational drone flying near the king's palace in Riyadh, was indeed a palace
coup attempt. Saudi Prince Salman was allegedly injured during the attempt, according to
reports, mostly coming from Iran.
As a man who enjoys the public and media's eye, Salman's absence caught attention especially
after he was not seen on camera during U.S. Secretary of State Mike Pompeo's first visit to
Riyadh in late April.
The 32-year-old leader ousted his older cousin as crown prince last summer in a palace coup
and then jailed senior royals as part of an anti-corruption sweep. Prominent clerics have also
been detained in an apparent bid to silence dissent.
Those moves have helped Prince Mohammed consolidate his position in a country where power
had been shared among senior princes for decades and religious figures exercised significant
influence on policy.
But they have also fueled speculation about a possible backlash against the crown prince,
who remains popular with Saudi Arabia's burgeoning youth population
"The US is looking for sales markets. We can understand this, and we are prepared to take
effort to ensure this gas reaches Germany easier. Presently, however, it remains much more
expensive than the gas delivered via the pipeline," the minister told ARD.
In addition, if the US does not change its tactics of behaviour and continues thinking only
of its economic interests, then Europe will act similarly, the minister added.
Earlier, Us officials said that the United Stats may impose sanctions on the companies
involved in the implementation of the Nord Stream 2
project. US Assistant Secretary of State Sandra Oudkirk said that Washington could consider
retaliatory measures within the framework of Countering America's Adversaries Through Sanctions
Act. She explained the US position as follows: the construction of the gas pipeline will
strengthen Europe's dependence on the Russian natural gas.
German Chancellor Angela Merkel said that Germany regards the Nord Stream 2 gas pipeline as
a safe economic project for Europe.
Nord Stream is an offshore natural gas pipeline from Vyborg in the Russian Federation to
Greifswald in Germany that is owned and operated by Nord Stream AG. The project includes two
parallel lines. The first line was laid by May 2011 and was inaugurated on 8 November 2011. The
second line was laid in 2011-2012 and was inaugurated on 8 October 2012. At 1,222 kilometres
(759 mi) in length, it is the longest sub-sea pipeline in the world, surpassing the Langeled
pipeline. It has an annual capacity of 55 billion cubic metres (1.9 trillion cubic feet), but
its capacity is planned to be doubled to 110 billion cubic metres (3.9 trillion cubic feet) by
2019, by laying two additional lines.
Sandra Oudkirk, US Deputy Assistant Secretary of State for Energy,
has just threatened to sanction the Europeans if they continue with the Nord Stream 2
pipeline project to bring gas in from Russia across the Baltic Sea. That country is also seen
by the US as an adversary and its approach is by and large the same – to issue orders for
Europe to adopt a confrontational policy, doing as it is told without asking too many
questions.
Iran and Nord Stream 2 unite Moscow and Brussels in their opposition to this diktat. On May
17, Iran
signed a provisional free-trade-zone agreement with a Russia-led Eurasian Economic Union
(EEU) that seeks to increase the current levels of trade valued at $2.7 billion. The deal
lowers or abolishes customs duties. It also establishes a three-year process for reaching a
permanent trade agreement. If Iran becomes a member of the group, it would expand its economic
horizons beyond the Middle Eastern region. So, Europe and Russia are in the same boat, both
holding talks with Iran on economic cooperation.
"... Several years ago Putin made a speech at the UN in favor of upholding International Law I thought at the time this "diplomatic statesmanship" was going to be Putin's way of bring Russia back into equal power with the Europeans and the US. Some have wondered and been asking about Putin not being as aggressive as he could be in defending Syria and Iran. Putin's holding off on tough talk/action could be amassing more power in the end. Putin comes off as the voice of sanity..exactly what the Europeans want to hear and see. ..."
Several years ago Putin made a speech at the UN in favor of upholding International Law I
thought at the time this "diplomatic statesmanship" was going to be Putin's way of bring
Russia back into equal power with the Europeans and the US. Some have wondered and been
asking about Putin not being as aggressive as he could be in defending Syria and Iran.
Putin's holding off on tough talk/action could be amassing more power in the end. Putin comes
off as the voice of sanity..exactly what the Europeans want to hear and see.
As Europe turns away from the US they turn to Putin.
If anyone remembers all the Jew rags making fun of "old Europe" during the Iraq war run up
and urging that the US break with them as outdated relics no longer needed in the new modern
age -- this is what it was all about -- separating the US from its traditional allies who
were not as subservient to Israel as the US. So .now we are down to the Jew plan Europe and
sanity vr the US Orange Clown and his allies of midget Nazi Israel, Saudi and the UAE.
Germany begs Russia to pick up the torch that US has dropped
"Germany's Foreign Minister, Heiko Maas, who has a history of expressing anti Russian
rhetoric relevant to Russia's presence in Syria as well as an alleged cyber attack on the
German Foreign Ministry which Maas says that he 'has to assume stemmed from Russia', has
turned an about face. He has traveled, for the first time, to Moscow to discuss international
diplomacy, the Iran nuclear deal, peace talks on Ukraine, and Syria.
Maas met with his Russian counterpart, Sergei Lavrov, where he encouraged Russia to
leverage its influence with Iran to help spur the Middle Eastern state in remaining committed
to the nuclear deal, which Trump abandoned earlier in the week.
Germany's Foreign Minister, Heiko Maas, who has a history of expressing anti Russian
rhetoric relevant to Russia's presence in Syria as well as an alleged cyber attack on the
German Foreign Ministry which Maas says that he 'has to assume stemmed from Russia', has
turned an about face. He has traveled, for the first time, to Moscow to discuss international
diplomacy, the Iran nuclear deal, peace talks on Ukraine, and Syria.
Maas met with his Russian counterpart, Sergei Lavrov, where he encouraged Russia to
leverage its influence with Iran to help spur the Middle Eastern state in remaining committed
to the nuclear deal, which Trump abandoned earlier in the week.
Maas then declared that Germany was interested in bringing back the peace talks on the
Ukraine, together with other European partners. Maas also pointed out that the Syrian
conflict can't be settled without Russia, before contributing a wreath to the tomb of the
unknown soldier, which is a dedication to Russian soliders who died fighting the Germans in
WW2.
Deutsche Welle reports:
Germany's top diplomat Heiko Maas and his Russian counterpart Sergey Lavrov both called
for the nuclear deal with Iran to be upheld on Thursday, during Maas' first official visit
to Russia. The appeal marks a rare moment of unity between Moscow and Berlin just days
after US walked out on the 2015 accord.
In Moscow, Maas urged Russia to influence Tehran and make it stick to the deal, which
aims to limit Iran's alleged pursuit of nuclear weapons. The German foreign minister also
said he was seeking details from the US on its plans for future sanctions against Iran
US President Donald Trump has shrugged off pressure from allies to keep the deal in place
and called the accord "defective at its core." However, leaders of the UK, France, and
Germany all contacted Iranian President Hasan Rouhani in the attempt to salvage the
accord.
Germany's Chancellor Angela Merkel called Rouhani on Thursday to reaffirm Germany's
commitment to the deal "as long as Iran continues to fulfil its obligations," said Merkel's
spokesman Steffen Seibert. Merkel also said she was ready to negotiate about Iran's
ballistic missiles and involvement in Syria and Yemen.
Angela Merkel is also set to visit Russia next week.
Visiting Moscow on Thursday, Germany's top diplomat Maas suggested reviving the peace
talks between Germany, France, Ukraine and Russia on the conflict in eastern Ukraine.
Lavrov responded by saying Russia was "ready to consider" this offer.
Maas also called for "honest dialogue" with Moscow and for Russia to be included in
global diplomacy, despite its differences with Berlin. Maas admitted that the conflict in
Syria "cannot be solved without Russia."
The German diplomat also laid a wreath at the Tomb of the Unknown Soldier in Moscow,
which is dedicated to the Soviet soldiers killed during World War II.
Also in a bid to get Russia to assume a leadership position relative to preserving the
nuclear deal, and by extension, the European economy, Merkel got on the phone with Russian
President Vladimir Putin, where he mutually voiced his concern over Trump's action, and
where Merkel also came forward about the situation in Syria.
TASS reports:
BERLIN, May 11. /TASS/. Federal Minister for Economic Affairs and Energy Peter Altmaier
has confirmed that he will visit Moscow at the beginning of the next week, he said in an
interview with German radio station Deutschlandfunk released on Friday.
"I will follow my colleague [German Foreign Minister Heiko] Maas, who attended
negotiations in Moscow yesterday. I will be there on Monday and Tuesday, and Chancellor
[Angela Merkel will visit Sochi -- TASS] during the week," Altmaier said.
In their March 15
letter , 39 US senators
called on the Treasury and State Departments to utilize all the sanction tools at their
disposal to fight the Nord Stream 2 project to bring cheap Russian gas to Europe. On March 29,
US Ambassador to Russia Jon Huntsman told Russia's RBK TV that he cannot rule out the
possibility that Russian assets in America could be seized over the Skripal case. If Washington
goes that far, it will be pure highway robbery. And the response will not be long in coming.
That interview took place right after the British parliament had
announced an investigation into some money-laundering schemes allegedly associated with
Russia. The UK government has unveiled its
"Fusion Doctrine" to counter what it's calling Russian propaganda.
The US policy of making Europeans bow to pressure has been largely successful. The leading
European powers -- the UK, Germany and France – --
are pushing to force the EU to impose new sanctions on Iran, in order to persuade the US
not to pull out from the Iran nuclear deal. This is a last-minute attempt to keep the agreement
in effect, as it is widely expected that President Trump will not certify it in May. Europeans
may bow to American pressure in a bid to appease Washington, but Russia is also a party to the
agreement, which cannot be scuttled without Moscow's consent. Adding additional conditions will
violate the terms of the deal. It won't be supported internationally. If new Iran sanctions are
introduced unilaterally by the West, the issue will become a bone of contention that will
further worsen relations with Moscow.
"... How about the West which has been trying to build a gas pipeline through Syria into Turkey to supply Europe with gas and break Russia's monopoly of European gas supplies. Don't believe me read the Doha agreement where the west recognised the Syrian rebels, this pipeline was a pre requisite for that recognition. ..."
"... And why would Assad who is winning the war do the one thing that would give America and other western countries the chance to get involved because of outrageous moral indignation. Assad and Outing really aren't that stupid. ..."
How about the West which has been trying to build a gas pipeline through Syria into
Turkey to supply Europe with gas and break Russia's monopoly of European gas supplies. Don't
believe me read the Doha agreement where the west recognised the Syrian rebels, this pipeline
was a pre requisite for that recognition.
Israel? which is not happy with Iran and Lebanon having a presence in Syria, worried that
America was withdrawing.
AlQaeda or the Syrian Rebels, many are both who are losing the war and this is a last
desperate attempt to drag in America and the west?
You've also got Turkey and the Kurds (the Kurds were abandoned by the West after they had
fulfilled their useful purpose), both also players in the region but I can't see a motive
here.
And why would Assad who is winning the war do the one thing that would give America
and other western countries the chance to get involved because of outrageous moral
indignation. Assad and Outing really aren't that stupid.
Any or all of the above could be the true motivation. I am no fan of Assad, Putin, or
Trump or May (or the Blair clone Macron) but the question you have to ask yourself is who
gains from this? And is. this in the interests of a resolution to a conflict, to your safety
or is it something else?
Report post " What exactly do we get from Russian that we couldn't do without? " <== The
willingness to ally with the U.S. vs the Chinese.
There is no denial of what Russia has done in the last few years, and it's wrong! However,
what is entirely missing from the western media is the U.S. ambassador to the USSR, Jack
Matlock, and George Kennan have been warning the American political elites since the 90's,
prior to Putin was even known and in politics, that the American foreign policy is steering us
straight into confrontations with Russia! It's not if but when it will happen REGARDLESS OF who
is in Kremlin! Nobody cared to heed because we were indulging ourselves as the sole superpower
in the world.
Neither has the American media reported even our old friend, Gorbachev, is praising Putin
and has harsh words for the U.S. In a nutshell, the Russians don't like to be treated as a
nobody country, ie. with decisions of world affairs already made and shoved at their face, and
they can either put up or shut up! However, that is exactly how Washington has conducted
business with Russia until the crisis in Ukraine in 2014. Would the American public put up with
a revolution led by a Russian politician in Mexico City or Ottawa, even though it's Mexican or
Canadians self-determination? Then what makes us think the Russians would tolerate John McCain
leading an anti-Russian revolution in Kiev, even if it's Ukrainian self-determination? Don't
forget the U.S. directly invaded Grenada when they were exercising their self-determination to
ally with the USSR!
This is not about defending Russia. The Russians can take care of that themselves. Rather,
can the U.S. afford to have Russia and China solidify their alliance again? It's already
happening unless we can adopt a sensible Russian policy to turn it around. Who would you rather
ally with? Someone (like the U.S.) who expects you to be a subordinate vs another (like China)
who is willing to treat you as an equal?
One can certainly argue how it is possible to ally with a country like Russia, who sponsors
dictators, meddles in our elections and tramples on other nation's self-determination. If you
are willing to be honest with yourself, just Google it. There is not one thing we accuse of the
Russians that our politicians are not doing it overseas, by MULTIPLE magnitude! The biggest
gripe the Russians have toward the U.S. is "are you preaching democracy or hypocrisy?" Yes, one
sin doesn't justify another, but why our politicians can't uphold this principle when they are
committing treacheries overseas?
I suggest that Russia act as "marginal producer" and refuse to sell oil,
gas or raw petroleum products for less than double the price of other
suppliers.
All of a sudden... thing will change.
After the treatment Russia has gotten for the past year or more, they
are more than justified to adopt this policy.
What's going on?
Read this:
"In late March, the U.S. State Department warned European corporations that
they will likely face penalties if they participate in the construction of
Russia's Nord Stream 2 gas pipeline, on the grounds that "the project
undermines energy security in Europe"
The Nord Stream 2 project and the
denial of pipelines through Syria territory is what's eating at the zio-cons.
This is power politics and Russia / China are too much of a threat.
The Russian central bank opened its first overseas office in Beijing
on March 14, marking a step forward in forging a Beijing-Moscow alliance
to bypass the US dollar in the global monetary system, and to phase-in a
gold-backed standard of trade.
Apr 3 2017 - Europe approves Nordstream 2 gas pipeline from Russia to
Germany
April 6 2017 - need to attack Syria.
Coincidentally, with a new government a gas pipelin can be run from
Qatar to Europe and cut-off Russian gas revenue.
*Three Mediterranean EU countries and Israel agreed on Monday to
continue pursuing the development of a gas pipeline ... EU countries and
Israel ... April 3, 2017 ...*
EU, Israel agree to develop Eastern Mediterranean gas pipeline
The Optics of the Inter National Geo Political Crises would suggest
that The Criminal Oligarch Cabal Bankster Intelligence Deep State Crime
Syndicate are going "All In."
The petroyuan project is the key. It will smash the petrodollar zio-world.
Saddam Hussien thought of doing that in the 80's by consolidating
Arab oil into a basket of currencies backed by gold. The problem for
him was he was a disposable puppet and not able to defend that
project. China and Russia are a different matter. It's driving the
zios batty.
And, the Yuan is now in the IMF basket of SDR's. Ultimately, the
Petro Dollar will meet its demise & it will be decided by which is
the cleanest, dirtiest shirt to put on among the SDR's.
"... I think the only that would really cause the Russians serious economic hardship at this point would be a total EU embargo on Russian oil/natgas. That, of course, would cause the rest of Europe a fair amount of hardship, too, as they would then have to pay 3 or 4 times as much for frack-gas from the US. ..."
I think the only that would really cause the Russians serious economic hardship at this
point would be a total EU embargo on Russian oil/natgas. That, of course, would cause the
rest of Europe a fair amount of hardship, too, as they would then have to pay 3 or 4 times as
much for frack-gas from the US.
Of course, oil/gas being fungible, the EU in such an eventuality would buy higher priced
gas/oil from us or someone and the Russians would just end up selling to other entities.
Whatever we sell to Europe is fuel we can't sell to others and it's not like our export
market is infinitely expandable. The EU has a huge need for natural gas which it mostly gets
from Russia via pipeline. Even if the US had that much surplus capacity, it would take years
to come up with the means to export that much LNG..
Hagios | Apr 11, 2018 8:50:17 AM |
58 I think that the read target here is the Nord Stream II pipeline. They're currently
unwilling to cancel it out of economic considerations, but they think that they could get away
with cancelling it if NATO attacks Syria and Russia responds with "unprovoked aggression."
NATO's attack IMO will be just large enough that Russia has to respond, then Trump and co. will
cease further military action and continue with economic warfare.
Transit of Russian natural gas via Ukraine will be reduced to just about 10-12 billion cubic
meters annually after the completion of two new pipelines -- Turkish Stream and Nord Stream 2.
That's what Gazprom's chief executive Alexei Miller told a Russian TV channel yesterday, confirming Kiev's
fears that Nord Stream 2 will deprive it of a lot of income in the form of transit fees.
The significance of the new figure can easily be seen when compared with the transit
quantities for last month: Gazprom sent
8.1 billion cubic meters of gas via Russia's eastern neighbor in March, a 21.3-percent
increase on the year. In other words, when Turkish Stream and Nord Stream 2 are ready, Ukraine
will receive something like a 12th of its current annual gas transit revenues from Gazprom.
This is reason enough for Kiev to be so vocally against Nord Steam 2, but unfortunately for
Ukraine, Germany is just as vocally supportive of the project, of which it will be the biggest
beneficiary. The expanded Nord Stream pipeline will have a capacity of 110
billion cubic meters annually.
Still, Miller said, not all transit via Ukraine will be suspended. "We are not saying we
will stop entire transit via Ukraine, since there are neighboring countries that border Ukraine
on the side of Europe. Naturally, supplies to these European countries will continue via
Ukraine."
While the news is bad for Ukraine, it makes sense for Russia as European countries eagerly
seek alternatives to Russian gas, including the "neighboring countries that border Ukraine,"
notably Poland. Yet Germany is by far Gazprom's biggest client in Europe and Russian gas is the
cheapest for Europe's largest economy, hence the support for a project seen as controversial by
the European Commission.
Turkish Stream, for its part, will send Russian gas to the European part of Turkey up to the
border with Greece, to supply gas to southeastern Europe. Its capacity is much smaller than
Nord Stream's, but still larger than the future transit via Ukraine, at 15.75
billion cubic meters of gas.
Russian elite already views May's government as bandits, who staged this despicable provocation. So stakes for British elite are
very high.
And the way May government tried to capitalize on this "poisoning" is really like going "all in". May clearly went what French call
"va bank". Reckless statement of Johnson, who is a very weak diplomat, but no fool, if a clear testament that they expect to prevail
with pretty weak cards. With ultimate reliance on power of the USA to secure favorable outcome.
Looks more and more that this is a part of Russiagate, or color revolution against Trump, however you want to call the effort: the
collusion between the intelligence heads of the Obama administration with British intelligence to oust President Trump.
The Russian Foreign Ministry is now openly pointing the possibility of a UK intelligence involvement. That sheds a very bad light
on EU vassals who without any questioning and with any proof immediately fell into line behind Theresa May.
The Chinese Foreign Ministry even said this was a tool used by the Europeans and the United States to try to get unity at a point
when they were completely disunified. And this is the old geopolitical game, that in order to create unity you create a war, and then
everybody has to fall into line before attacking Iran.
Compare with Ron Paul views on this incident: www.youtube.com
Notable quotes:
"... The UK foreign secretary, Boris Johnson, in a speech late on Wednesday waxed lyrical about how the Skripal episode represented a turning point in the west's approach to Russia, but his officials are aware that this mood can easily dissipate as other considerations, such as commerce, energy security or the Middle East come into play. ..."
"... The UK will try to push for further measures against Russia at the June meeting of the EU heads of state. If it is ambitious, it may may challenge German support for Nord Stream 2, the gas pipeline from Russia that could put European energy demand at the mercy of Moscow. ..."
That does not mean the crisis will necessarily end there, or that the crisis is contained.
Russia, whose standing among the international community
is badly damaged, is determined to do go further to clear its name, or at least throw up enough chaff so that a chunk of western
public opinion doubts the British intelligence service's account of Skripal's poisoning. Moscow has already suggested a meeting on
Monday of the executive of the Organisation for the Prohibition of Chemical Weapons (OPCW) to have "an honest conversation" about
the poisoning.
The OPCW is studying samples – provided by the UK – of the novichok nerve agent allegedly used, but does not have the ability
to judge the identity of the person that
placed the agent by the door of Skripal's house . But the Russian foreign minister, Sergei Lavrov, is determined to put the UK
on the defensive and has already claimed that "if our western partners dodge the meeting then it will be further evidence that every
thing that is happened is a provocation".
Russia has also responded to the apparent recovery of Yulia Skripal, who was poisoned alongside her father. She may be able to
provide insights into how the poisoning occurred, or even reveal whether she knows of some other motive by some other non-state actor.
The British intelligence services will be debriefing her as soon as her health permits. It would clearly be a huge embarrassment
for the UK government if it emerged she believed the Russian state was not involved.
As it is, the UK government is aware that some allied leaders, despite the public show of solidarity, face skeptical voters at
home who are either against a confrontation with Vladimir Putin, or expect more convincing proof to be provided.
The UK foreign secretary, Boris Johnson,
in a speech late on Wednesday waxed lyrical about how the Skripal episode represented a turning point in the west's approach
to Russia, but his officials are aware that this mood can easily dissipate as other considerations, such as commerce, energy security
or the Middle East come into play.
The UK will try to push for further measures against Russia at the June meeting of the EU heads of state. If it is ambitious,
it may may challenge German support for Nord Stream 2, the gas pipeline from Russia that could put European energy demand at the
mercy of Moscow.
China's rise has made the US fear the loss of its role as the sole superpower. And the
neoliberal elite fights back. That replays on a new level rift of the USSR and China in the
past.
... the plan to impose 25 per cent tariffs on $60bn of (as yet, unspecified) Chinese exports
to the US shows the aggression of Mr Trump's trade agenda. The proposed tariffs are just one of
several actions aimed at China's technology-related policies. These include a case against
China at the World Trade Organization and a plan to impose new restrictions on its investments
in US technology companies.
The objectives of these US actions are unclear. Is it merely to halt alleged misbehaviour,
such as forced transfers -- or outright theft -- of intellectual property? Or, as the labelling
of China as a "strategic competitor" suggests, is it to halt China's technological progress
altogether -- an aim that is unachievable and certainly non-negotiable. Mr Trump also
emphasised the need for China to slash its US bilateral trade surplus by $100bn. Indeed, his
rhetoric implies that trade should balance with each partner. This aim is, once again, neither
achievable nor negotiable.
...A still more pessimistic view is that trade discussions will break down in a cycle of
retaliation, perhaps as part of broader hostilities.
I am not a fan of LNG. If I was a Euro there is no way I would allow LNG in, whether
from Sabetta in Russia or from Sabine Pass in the US.
Being fan or no fan of specific type of energy hardly factors into economic reality of
Europe and coercing it into buying American LNG. If Europe continues to buy Russian gas --
that will be bad news for US. The US, however, may yet succeed in sabotaging Nord Stream II
and thus, in a long run, kill European industrial competitiveness thus opening European
market for US products. At least that is the plan. Here is a small taste of what is at
stake.
Turkish press is reporting that 'TurkStream' , the pipeline to bring natural gas from
Russia to Turkey, is now 80% complete and to be in operation by later this year. It is
expected to deliver close to 16 billion cubic meters per year from Gazprom to Turkish gas
distribution networks. A second phase scheduled for next year will reportedly deliver an
equal amount to Greece and other points in southern Europe.
This is in addition to the existing 'BlueStream' pipeline from Russia to Turkey,
operational since 2005, that also has a 16 billion cubic meter per year throughput.
Why the Western concern about NordStream pipeline but none about TurkStream? Are there no
sanction problems for the Swiss company working with GazProm? Plus I wonder if this is one of
the reasons why Russia has lately become paranoid regarding US Navy FON operations in the
Black Sea?
Why the Western concern about NordStream pipeline but none about TurkStream? Are there no
sanction problems for the Swiss company working with GazProm? Plus I wonder if this is one of
the reasons why Russia has lately become paranoid regarding US Navy FON operations in the
Black Sea?
The main concern has the name Sabetta--it is the port and a hub to a largest Liquid
Natural Gas operation, which also happened to be (in relative terms) next to Europe's LNG
ports. I usually don't do this but I apologize, here is a link to my blog's piece on
that:
LNG is precisely a commodity which is counted by US as a major component in possibly (and
most likely not very probable) US re-industrialization. For that, the US has to sell her LNG
to Europe. This implies removing Russian LNG from the EU market which dwarfs that of Turkey
and some South European nations. Germany, France, UK, Holland among others are the prize
here. Russian LNG must be verboten, in US mind, or at least pushed back. As per FON--it has
nothing to do with FON but has everything to do with:
1. Flag demonstration--that is presence and Fleet In Being.
2. Signals collection from Sevastopol, Novorossyisk and, in general, all Russia's Southern
Military District emitters.
"... When I read: "As X becomes increasingly aggressive, even reckless geopolitically," frankly Russia was not the first country that came to mind. ..."
Yves
here. I trust readers will be able to filter out the new Cold War assumptions in the piece to
focus on the price of Germany's plans. Does anyone have an informed take on how significant the
broader economic impact might be?
By Tim Daiss, an oil markets analyst, journalist and author working out of the
Asia-Pacific region for 12 years who has covered oil, energy markets and geopolitics for
Forbes, Platts, Interfax, NewsBase, Rigzone, and the UK-based Independent (newspaper) as well
as providing energy markets analysis for subscription newsletters. Originally published at
OilPrice
More problems are mounting for Russia's oil and gas sector. This time it's coming from
Germany, which until recently usually gave Russia's energy sector more lead way than the U.S.
or other allies.
But now it seems that German Chancellor Angela Merkel has also had enough. On Monday,
Bloomberg reported that Merkel's government is seeking to build a liquefied
natural gas (LNG) industry in Germany basically from scratch to reduce the nation's dependence
on supplies arriving by pipeline from Russia and Norway.
Merkel backs "all initiatives supporting further diversification of gas supply -- whether
from different regions or means of transporting gas," said German Economy and Energy Ministry
spokeswoman Beate Baron.
The move comes as natural gas resources from the UK and the Netherlands are depleting, and
Germany is forced to rely more on Russian gas. Merkel's newly formed coalition has a "coalition
contract" that among other policies sets out energy agenda including LNG for the next four
years, the Bloomberg reported added.
Germany, for its part, is Europe's largest gas consumer. In
2015, the country consumed 7.2 billion cubic feet per day (Bcf/d) of natural gas, according to
U.S. Energy Information Administration (EIA) data. According to the German energy research
group, AG Energiebilanzen, imports account for about 90 percent of Germany's total natural gas
supply, while most imports come from three countries: Russia (40 percent of total imports in
2015), Norway (21 percent) and the Netherlands (29 percent).
Moreover, German companies are participating in Russia's controversial Nord Stream 2
pipeline, an expansion of an existing route for gas to flow from Russia to Europe under the
Baltic Sea. The U.S., Poland and others have recently condemned the pipeline as a threat to
European security.
As Russia becomes increasingly aggressive, even reckless geopolitically, the security threat
to not only the EU but to Germany is apparent, causing the country of some 83 million people to
do an abrupt energy policy about face.
Germany's LNG pivot also comes as a geopolitical storm between the U.K. and Russia
intensifies over an alleged Moscow-orchestrated nerve-agent attack on British soil against what the
BBC called a double spy and his daughter.
British Prime Minister Theresa May retaliated last week by expelling Russian diplomats and
seeking alternatives to Russian gas, including LNG produced at its new Arctic plant, the Yamal
LNG export project. Addressing the UN Security Council last week, the U.K.'s deputy UN
ambassador, Jonathan Allen, accused Russia of breaking its obligations under the Convention on
the Prohibition of Chemical Weapons.
The U.S. for its part also condemned the nerve agent attack. U.S. ambassador Nikki Haley
said that Washington stood in "absolute solidarity" with Britain, citing the "special
relationship" between the two countries and saying that Washington would "always be there" for
the UK.
Germany's Abrupt LNG Pivot
However, until recently many in Germany accused the U.S., notably President Trump, of using
U.S.-sourced LNG as a geopolitical weapon to challenge Russia's decades' old dominance of
European gas markets -- an accusation that played perfectly into the hands of Russian energy
companies and even Vladimir Putin.
When Trump singed fresh sanctions against Russia's energy sector in August, Uniper -- a
German utility and one of Europe's largest energy firms -- said the new sanctions were an
American economic move as much as a political one.
"The core reason (for the sanctions) is strategic economic interests, meaning the targeted
dominance of the US in energy markets," Uniper CEO Klaus Schaefer told journalists shortly
after Trump signed the sanctions bill. Uniper is one of five companies that have invested in
Nord Stream 2.
Brigitte Zypries, Germany's economy minister, claimed last year that the sanctions violated
international law and said that the EU should take action against the U.S. "Of course we don't
want a trade war. But it is important the European Commission now looks into countermeasures,"
she said. "The Americans can't punish German companies because they have business interests in
another country."
Cost Factors Could Impede Pivot
However, any Germany pivot to LNG away from Russian gas will come at a cost. Shipping LNG by
one of several suppliers, including Qatar, the U.S. or Angola to name a few, is simply more
expensive than Russian piped gas. While Russia already has an extensive pipeline network in
place, LNG is more expensive when transportation, liquefaction and regasification costs are
added.
Using a Henry Hub gas price of $2.85/MMBtu as a base, Russian energy giant Gazprom recently
estimated that adding processing and transportation costs, the price in Europe would reach
$6/MMBtu -- a steep markup.
Henry Hub gas prices are currently trading at $2.657/MMBtu. Over the last 52-week period
U.S. gas has traded between $2.64/MMBtu and $3.82/MMBtu.
Russian gas sells for around $5/MMBtu in European markets. Moreover, Russian gas exporter
Gazprom is also moving away from oil-indexation for gas prices to a European gas hub
indexation, which will allow additional price savings and unfortunately for Germany -- an
incentive to stick with Russian gas, even if it's geopolitically distasteful.
Meanwhile, Russian Energy Minister Alexander Novak
said yesterday that Russia is Europe's most flexibly and reliable source of energy that is
needed.
Its a long long way from a political announcement to an industrial reality. Also, the
quote:
Merkel backs "all initiatives supporting further diversification of gas supply" is
telling.
Germany does not want to be caught out in a Russia/US energy squeeze while its pursuing an
alternative energy path. Nor does Merkel want to overtly pick sides.
Plus if you will note, given the momentum of current German/Russian energy initiatives, I
rather doubt that this "announcement" will have a lot of traction in the near future.
The Oilprice site, although very informative is somewhat shrill from day to day
(everything is a BIG DEAL).
Yes, its a telling quote -- it can basically be paraphrased as 'if someone is willing to
pay for these facilities, we would be happy to hear that'. There are quite a few stalled
projects for LNG terminals in Europe -- but they are expensive and even the promise of cheap
US LNG won't unlock them so long as Russia can supply relatively cheap gas. If European
governments want more LNG terminals for security reasons then they'll have to pay for them.
Thats not likely to happen, there are far more pressing infrastructural needs.
Is anyone considering the possibility that the US's ability to deliver LNG may not exist
for long enough to pay the cost of building the infrastructure necessary to use it?
Is anyone factoring in the damage to our environment, including our fresh water when
calculating the cost of poking Russia in the eye?
At first glance, this whole play appears short-sighted, at least, probably foolish.
Of course the big oil companies have never gone unrewarded for their fealty to the whims
of the MIC, even when any objective analysis finds massive foolishness.
Dont worry, Novatek already delivered a shipment of LNG from the Yamal peninsular to the
UK.
I would bet that Nord Stream will not eliminate the need to export across the Ukraine.
Undersea pipelines dont have great capacity. But additional marginal pipeline capacity does
reduce the bargaining power of the Ukraine. Im sure LNG capacity does the same.
We're deep into our malinvestment phase where uneconomic industries are being sustained
with monetary policy to prop up an unsustainable status quo.
The question is whether the left can coordinate collective action before the right can
start WW3. It will be real events somewhere that cause real change: financialized capitalism
with its own hand on the money spigot of fiat money is, with reference to itself, a perpetual
motion machine.
It will either be a force of life, or thermodynamics that finally overthrow this machine.
The stresses for dramatic external political events are building everywhere.
However, this is where market capitalism excels. As long as there is enough money in the
hands of the average person (a major issue), the average person will install solar panels and
batteries and heat pumps and buy an EV and say "to hell with you" to the oil, gas, and coal
industries.
Less money is going to those average folks, but local EV is hopeful. Tons of money goes to
supporting facking, which in the absence of QE and the spigot of free money for
(mal)investors, would not be economical.
LNG ports to receive a fuel with what is approaching negative EROEI are pure
mal-investment.
MMT was used to incentivize net positive public goods by Mariner Eccles making the US the
richest nation in the world. We're now seeing the global financial cabal use the same tool to
despoil real wealth, monetizing it along with trust wherever it can find either. It is an
epic of short-termism that will ultimately destroy the money itself by liquidating the real
productive social and economic constellations that support it.
I read the statement as that Germany is looking for a replacement of its Dutch and
Norwegian gas sources. As Germany does not want to depend for 100% of its gas from Russia,
they do need to look for alternatives.
It is just smart policy not to depend from a single source, for whatever purpose.
Dutch and Norwegian gas reserves are in
long term decline , so its likely that Russian gas will become a higher proportion of
supply in the medium to longer term.
i) the cost of transport is very high and there is a linear relationship between distance
and transport costs
ii) both the client and the supplier would like stable long-term contracts to secure
investments and supply.
There is always interdependence if you want durable supply.
Constructing some LNG facilities, besides the cost factors mentioned above won't reduce
such interdependence by much given that Russia provides 40% of current consumption. Also,
Russia migth seek providing NG to fast growing asian markets. I think that Germany is trying
to diversify just because Norway, Netherlands, and its own production are declining. I also
think that this means that fracking gas in Europe is not seen as an alternative.
I wouldn't say that Germany will "pivot" from russian gas, that is giving too much weigth
to potential LNG supplies.
Another point is that if the issue is security, it would most likely be more cost
effective to build up a buffer in underground storage facilities than building new LNG
terminals.
I could be that Germany is buckling under the pressure of attacks as the US is threatening
to sanction European firms involved in the Russian/EU Nord Stream 2 project ( https://www.rt.com/business/421900-us-sanctions-nord-stream-companies/
) which if true, would mean that the EU would have to ask the permission of Washington in
dealings with any countries not to Washington's liking.
The Poles have already built a LNG gas delivery terminal so you would think that Germany
would just pipe it in from there unless Germany wanted to build their own terminal so that
they would not have to pay Poland any fees as Poland is one of the counties opposing Nord
Stream 2.
Poland has already received at least one LNP shipment from the US but the price of the
delivery is a state secret apparently.
The Russians could always turn around and sell their cheaper gas to China so no big loss
to them. Thing is, it will take a decade to build a fleet of tankers to carry the gas that
Germany needs annually as these ships would just be going back and forth like clockwork. Who
pays for that? Germany would also need years just to build the LNP port facility to receive
these shipments. I believe too that the US export terminal is in the Gulf so tough luck if a
hurricane shut down that terminal at any time. Remember, this winter the Russians had to ship
two tankers of gas to the US because of shortages so how reliable could a US supply be?
Add up the costs of building the port facility, a fleet of tankers and the infrastructure
to deal with it all, then top up with the gas not only being more expensive than the Russian
gas but also less reliable and the Germans will have to take a knife to their budget to pay
for it all. Trump would have a fit if it was their defense budget so that means the social
budget. Good luck with that. One last factor of which I have even less knowledge of is the US
gas supply. I believe that it comes from shale deposits aka fracking but I know that these
wells deplete rapidly so if true, would suggest that US gas as a supply source may be self
limiting over time. I don't think that the economics work out here for Germany somehow.
It's not a pivot. The only important thing is North Stream 2: if the US or the
transatlantic lobby manages to kill that, then there is a pivot. Otherwise, it's business as
usual.
So unless one wants to be ~90% dependent on russian gas, there has to be some alternatives
to keep the russians honest. Only realistic way is LNG. So Germany has to build the
infrastructure for it to have a credible bargaining position. The marketshare of russian gas
will increase over the next few years in any way.
Also, I would like to add that the German Press isn't treating this like some sort of
revelation.
As everywhere else, if a politician wants to get a little patriotic push on their side,
they hold a speech touting "energy independence". Germany is no different in that regard and
Merkel needs to appear a bit more nationalistic right now.
Current headlines are all about social issues like immigration, Facebook data breaches,
internal politics, etc. No one is obsessing about LNG facilities or things like Brexit.
There are major offshore gas fields in the Mediterranean -- on the coast of Cyprus and all
the way offshore from Syria to Egypt. Their exploitation is still largely pending resolution
of local crises (Turkey vs EU re Cyprus, Israel vs Palestine and Lebanon, in Syria because of
war). Once those fields come on line, the need for special-purpose ports to bring in LNG from
afar to Europe no longer makes much economic sense.
Besides, Algeria continues to provide gas (and oil) to the EU.
Germany is a major shareholder in the EPR reactor, but isn't building any
because its proven far too expensive, much more expensive than domestic renewables.
Its untrue to say that Germany buys a lot of French nuclear energy, imports from France are minor at a net
of around 4 terawatt hours a year, similar to the amount of wind energy Germany buys from
Denmark. Its dwarfed by the huge renewable sector in Germany which produces over 200 TWh per annum . Germany is
actually a net exporter of energy to France in most summers as the inland nuclear plants
often go off-line due to water shortages.
"Germany's LNG pivot also comes as a geopolitical storm between the U.K. and Russia
intensifies over an alleged Moscow-orchestrated nerve-agent attack on British soil against
what the BBC called a double spy and his daughter."
When one thinks about the geopolitical repercussions of this nerve gas attack on $$ for
USA LNG, the control of energy supplies to the EU by the USA and its middle east puppets, the
quickly identified fingerprint and emotionally charged finger pointing, a complex technical
topic to which the general public has general knowledge and therefore must rely on
"authorities", the high level of media attention for a relatively minor character, and the
ongoing attempts to vilify and isolate Russia -- one has to wonder if this is just another
CIA false flag event similar to Iraq WMDs and the Syrian chemical weapons attacks -- another
false flag that will eventually fall apart after it has served its purpose. Examined in the
light of past and ongoing CIA atrocities (Renditions and torture in Abu Ghraib and Gitmo,
droning, MKULTRA, Operation Mongoose, Phoenix Program, Iran-Contra, numerous assassinations
and coups -- just to name a few), it seems quite in line with what I would expect from this
criminal organization. Not that we can really know the truth at this time, but those who
dutifully believe the corporate media on this topic might want to open a skeptical eye. There
are likely cover stories within cover stories -- much like cover stories one finds in the
Wormwood documentary.
This news along with Trudeau's support for Kinder Morgan Canada's Trans Mountain oil/tar
sands pipeline expansion should make it clear that the Paris Accords were a cruel joke on
humanity. We will keep extracting every single last drop of recoverable oil until we run out
of energy to continue or we nuke ourselves.
So, it's easy enough for Germany to pivot away from gas *if* they switch to heating with
electricity. However, Merkel refuses to push this. Because Merkel.
The Senators' argument is that dependence on Russian gas undermines European security.
Whereas to the Russians, it is obvious that the Americans wish to replace cheap Rusian
piped gas with expensive liquefied American gas, which is a bi-product of fracking for oil
and currently in surplus. Some frackers in Canada are even having to pay someone to take
their gas.
Surprisingly, no one has yet pointed out that Russia could deliver Novichok to the whole
of Europe via Nordstream 2.
"... This is a European energy issue. From the start. The US either wants to be the middle-man or cut Russia off from it entirely. No other options have been tabled or would be acceptable to Washington. Remember the Trump quote "Why don't we just take their oil and gas?" ..."
"... Look at the opposition gaining speed against Nord Stream II. And also look, the UK and all of Europe may be in for some cold summers and winters now, it's a trend they cannot ignore as it gets colder for longer periods, this trend isn't relaxing with the stratosphere doing some flips and turns and sending "The Beast From The East" towards the once Great Britain. ..."
The Skripal anti-Russia hysteria effort is just another step in the US/CIA campaign to
interfere with the Russian hosting of the World Cup -- the next step will be to attempt to
have the qualifying European countries boycott the event ... remember, to them, every Russian
loss is an American win.
However, I will go on record to predict that the US will have its Ukrainian neo-Nazi
vassals mount a major attack on the Donbass within week of the beginning of the World Cup
tournament.
I agree the World Cup is on the agenda, but this effort is multi-pronged, like Octi-putin,
they will want to boycott it and you will see all sorts of FIFA related articles in the
coming months, corruption and so on. It's all predictable.
This is a European energy issue. From the start. The US either wants to be the
middle-man or cut Russia off from it entirely. No other options have been tabled or would be
acceptable to Washington. Remember the Trump quote "Why don't we just take their oil and
gas?"
Look at the opposition gaining speed against Nord Stream II. And also look, the UK and
all of Europe may be in for some cold summers and winters now, it's a trend they cannot
ignore as it gets colder for longer periods, this trend isn't relaxing with the stratosphere
doing some flips and turns and sending "The Beast From The East" towards the once Great
Britain.
It is about bankrupting Russia and also trying to get European
nations to turn the Russian gas tap off, and so Europe will have to resort
to buying gas through Western controlled natural gas resources, liquid gas
shipments, and a proposed Qatar-Turkey pipeline through Syria. Once most
Western people discover the actual history of our wars and what ruthless,
unconscionable bastards our Western power brokers actually are, they will
automatically want to support Russia.
This is the May-Johnson excuse for not going through with Brexit. Now they
will say they need their partner in the EU to protect them. Good luck with
that one.
I wouldn't write NATO off just yet. Rothschild bought Naftogaz which has an
office in Egypt. Igor Kolomoisky has some interesting ties also the
temporary occupation of Crimea by Russia. And who is Genie Energy?
"... Another background to the British provocation might be the Nord Stream gas pipeline from Russia to Germany. Construction is to start now and once it is finished Ukraine can´t blackmail Europe anymore by holding up gas delivery. Poland, the Baltics, the US and of course Ukraine are violently opposed to Nord Stream 2. ..."
...The British noise about the alleged nerve gas agent is then nothing more but another
attempt to force Washingtons´s hand to increase hostility towards Russia.
Interestingly enough today Germany´s defense minister who is a close confident of
Merkel echoed the outrage about the alleged nerve gas attack but called for a "UN
investigation". That is she didn´t endorse the British claim.
Another background to the British provocation might be the Nord Stream gas pipeline from
Russia to Germany. Construction is to start now and once it is finished Ukraine can´t
blackmail Europe anymore by holding up gas delivery. Poland, the Baltics, the US and of
course Ukraine are violently opposed to Nord Stream 2.
Sanctions on Russia are being ignored. China is investing its US Trillions. Under US imposed
sanctions, ExxonMobil withdrew and China said "Thank You" and took the partnership.
Chinese state-controlled Huarong Asset Management has bought a 36.2 percent stake in the unit
of CEFC China Energy through which CEFC is acquiring a $9.1 billion stake in Russian oil
giant Rosneft.
According to CEFC filings seen by Reuters, Huarong has bought the stake in CEFC in two
tranches, one in December and one in February. Huarong is controlled by China's Ministry of
Finance.
In September, CEFC Energy announced plans to acquire 14.16 percent of Rosneft shares from
Glencore and the Qatar Investment Authority (QIA).
"The final structure of Rosneft's shareholders has been formed," Rosneft CEO Igor Sechin
told Rossiya 24 television.
As part of a long-term agreement, Rosneft and CEFC Energy inked a deal on crude oil
deliveries in 2017. According to the agreement, the Russian oil major will supply CEFC with
60.8 million tons of oil annually until 2023.
The agreement covers the development of exploration and production projects in Siberia.
The two companies plan to cooperate in refining, petrochemicals and crude trading.
The Ukrainian authorities have started the seizure of assets belonging to the Russian gas
giant Gazprom, citing its alleged non-compliance with the decision of the Stockholm arbitration
court. "Under the current circumstances, the Ukrainian cabinet initiates action aimed at
recovering [a] penalty from Gazprom," the Ukrainian government's press service said in a
statement published on its official website. It also claimed that the move was conducted in
compliance with the decision of the Stockholm court and involves collecting a fine from the
Russian company over its alleged violation of Ukrainian anti-monopoly legislation. Read more
Ukraine is
overpaying for European gas & wants Russia to foot the bill
The Swedish arbitration body initially ruled on the three-year dispute between Gazprom and
the Ukrainian energy company, Naftogaz, back in December 2017. The policy of the court prevents
it from even acknowledging that it's mediating a case, which makes it impossible to obtain its
own account of the final ruling. Both energy companies, which have opposing takes on the
outcome, initially claimed victory in the case.
In late February, the same court ordered Gazprom to compensate Naftogaz $4.6 billion for
what the latter sees as lost profit from the transit of Russian gas to Europe.
The legal battle between the two energy companies in the Arbitration Institute of the
Stockholm Chamber of Commerce had rumbled on since June 2014. Gazprom's claims related to fines
for insufficient withdrawal and use of gas by the Ukrainian side, in accordance with a
'take-or-pay' rule. The Russian gas giant also demanded payment of a debt for gas
delivered to Ukraine between May and June 2014.
Naftogaz pushed for a retroactive change in the price of gas, the reimbursement of
overpayments and the repeal of a ban on reselling Russian gas. The court eventually satisfied
some of the Ukrainian company's demands, in particular by setting a minimum amount of gas that
Naftogaz must buy from Gazprom annually (from 2018) at a volume that was 10 times lower than in
the original contract. At the same time, it also obliged Gazprom to pay for the transit of the
Russian gas through the Ukrainian territory between 2009 and 2017 even though the gas was not,
in fact, transited over that period.
The Head of Gazprom, Alexei Miller, then called the court's decision "asymmetric"
and "very politically motivated." The court justified its decision by referring to a
difficult economic situation in Ukraine.
"... Bullshit. The Ukrainians have been on a pay before delivery tariff from Russia for years. They have chosen war over trade. They currently prefer to spend what income they get that survives oligarch looting on trying to kill the East Ukrainians (currenly 6.9% of GDP). ..."
Sat, 03/03/2018 - 21:13 Last week, Russia's state-run gas giant and quasi-monopolist when it
comes to European natgas supplies, Gazprom, announced it would not restart shipments of natural
gas to Ukraine's Naftogaz starting March 1 after the two sides failed to reach an agreement,
Gazprom deputy chairman, Alexander Medvedev, told journalists.
Russian gas deliveries to Ukraine were supposed to restart on Thursday following a foreign
court ruling aimed at ending years of disputes between Kiev and Moscow, including two halts to
Russian gas supplies to Europe through Ukraine. But Gazprom unexpectedly refused to resume
deliveries, returning the prepayment for supplies made by Kiev, claiming amendments to a
contract had not been completed.
The decision came as the sides reportedly failed to extend a supplemental agreement to the
current gas contract, RT
reported.
"So far, the supplemental agreement to the operating contract with Naftogaz has not been
approved, and that is a compulsory condition for launching the shipments," Medvedev said. "So,
we have to recover the amount paid by the company in full. And it is obvious that the shipments
in March won't start."
In response, Ukraine's state monopoly said that Gazprom had failed to deliver prepaid gas.
Naftogaz is reportedly planning to claim damages for supply failure from the Russian energy
major.
And while the long-running dispute may, but likely won't, be resolved in court, Ukraine has
suddenly found itself without heat and on Friday urged schools to close and factories to cut
production, while residents shivered as the country strained to save on gas supplies.
The decision coincided with freezing temperatures all over Ukraine, and the government
called on Friday for measures to reduce consumption.
" Starting today, we recommended ... to stop the work of kindergartens, schools and
universities ," Ukraine energy minister Igor
Nasalyk told lawmakers , while urging Ukrainian companies to adjust their operations to
save gas, while power companies were ordered to switch to fuel oil where possible.
Nasalyk said these savings measures would be in effect until Tuesday, when temperatures are
expected to rise.
* * *
Meanwhile, on Friday, Gazprom director Alexei Miller said that the company would immediately
turn to the Stockholm arbitration court to break its contract with the Ukrainian operator
Naftogaz, Russian news agencies reported. A ruling by the same court last year was meant to
halt disputes over gas prices and shipments, which had often been a proxy for political
disputes between Moscow and Kiev. The court set a price and ordered Kiev to resume purchases it
had cancelled following the breakout in "proxy" violence between the two nations in 2014.
Also on Friday, Naftogaz said that Gazprom had not only refused to resume deliveries meant
for it, but lowered the pressure in gas pipelines by 20 percent and minimized sales to other
customers. In a statement, Naftogaz said that Gazprom was trying to portray Ukraine in a
negative light and suggest that it was willing either to let its own population freeze or make
it out to be "an unreliable transit company that takes the gas away" from European
countries.
In response,
Reuters reported today that Gazprom said there had so far been no impact on supplies
through its pipelines to Europe, despite the sharp escalation in tensions with the key transit
nation.
Russia's Energy Minister Alexander Novak told European Commission Vice President Maros
Sefcofic in a phone conversation that gas transit would not be at risk until Gazprom and
Naftogaz fully terminated their agreement.
"Minister Novak assured that the gas transit from Russia to Europe is under no threat. The
transit remains as reliable as in the past," the ministry said.
* * *
Kiev and Moscow have a history of clashing over prices and obligations under contracts for
the delivery of Russian gas to Ukraine as well as transit to Europe. The standoff in the winter
of 2006 triggered supply disruptions, with Russia accusing Ukraine of stealing gas intended for
the European market.
The gas giants are currently involved in a long-standing litigation over the terms of the
current delivery contract. Ukraine's lawyers are struggling for annulment of the so-called
take-or-pay provision that obliges Kiev to purchase a minimum annual quantity of gas. Earlier
this week, Naftogaz claimed it had won a $2.56 billion victory in another round of its legal
battle with Gazprom.
Karma can be a bitch Ukraine. Still, I'm sure your friends in Washington will immediately
provide you with an endless supply of free LNG? Call Vicky.
Incidentally, to the author, your map is incorrect (i'm sure that was just an error like
Goolag's deletion of Themtube sites). Crimea is no longer a part of Ukraine after 95%+ of its
population excercised their right to self-determination after the Maidan coup.
Ukraine's already connected to Poland's LNG port. And by the way, days at sea for a ship
with Qatari LNG is the same as a saudi tanker hauling oil to the U.S.
Ukraine is in a total meltdown, forget about Venezuela which at least has energy stores.
Ukraine has to import most of its energy. Donbass has all the coal. Putin is a genius, he is
starving Ukraine of energy. There will be mass unrest in the country. Expect a government
friendly to Russia to come back into play. The only thing that can prevent this is if Europe
and the USA are willing to pay for Ukraine's energy needs.
Where otherwise will Ukraine get
the hard currency. Well for a while it will get it by selling off its farmland and its women.
In ww2 you could buy a woman with a package of pantyhose, an MRE, or a pack of cigarettes.
Now you will be able to buy them again the same way and with a lump of coal.
"Ukraine Freezes After Russia Halts Gas Deliveries"
Bullshit. The Ukrainians have been on a pay before delivery tariff from Russia for years.
They have chosen war over trade. They currently prefer to spend what income they get that
survives oligarch looting on trying to kill the East Ukrainians (currenly 6.9% of GDP).
On
March 1, Ukraine closed all schools, colleges and universities to conserve energy. Following
a Stockholm arbitration court decision on March 1, Gazprom has started the process of
cancelling the contracts for supply of gas to and through Ukraine. They are at liberty to
purchase it at market rates ($600 per 100 cubic metersversus the subsidised $300 from Russia)
from the Europeans.
Joe Biden's son, Hunter, was hired by a Ukraine company, Burisma Holdings Limited,
promoting energy independence from Moscow. So hows it goin Hunter??
Too busy fooling around with his late brother's widow. No time for Ukraine. Murica can help
fund some gas, if they can throw away a couple billion for the coup, c'mon Guys, Porky is
yoar Bro.
Most likely he was fooling around with her before his brother died. Some of his nieces and
nephews may be his kids. The Bidens are a microcosm of the perverse behavior in DC.
"Kathleen Biden accused estranged husband Hunter of reckless spending on 'drugs,
prostitutes, and an $80,000 diamond' in divorce docs - days before his affair with widowed
sister-in-law Hallie was revealed"
" Kathleen claims Hunter spends money on 'drugs, alcohol, prostitutes, strip clubs and
gifts for women with whom he had sexual relations' in her new motion "
I live in Minneapolis. The weather here isn't too different from much of Ukraine. For
early March we're having a very warm day, nearly 50 F. But next week we get back to more
seasonal highs around freezing, with maybe 6" of slushy snow on Monday.
I really like it when my heat works. I do have a wood-burning fireplace but if I have to use it for heat we've got a lot of
problems all at once. Ukraine is a great example of what always happens when Nazis get in charge. Everything
goes to hell in a handbasket, quickly.
The fools just might do that to keep the riots out of the government buildings in Kiev.
Russia doesn't want the basket case either so who knows what the war would look like. Kiev is
totally screwed either way this goes.
No Russia knows that any dealings with Kiev or ukr companies are disastrous. Russia acts
very carefully within the law. Hence immediate return of first gas payement since 2014, so
not legally bound. Hence Gasprom requiring a signed contract under mutually agreed conditions
which they did not get.
Already Ukraine is say there is a 20 percent drop off in pressure on transit gas thru.
ukr. Russia says not, it is gas pressure as usual.
Looks like Ukraine is stealing 20percent of transit gas immediately.
@4 "For the life of me I cannot figure why Americans want a war/conflict with Russia."
Ever since US Crude Oil peaked its production in 1970, the US has known that at some point
the oil majors would have their profitability damaged, "assets" downgraded, and borrowing
capacity destroyed. At this point their shares would become worthless and they would become
bankrupt. The contagion from this would spread to transport businesses, plastics manufacture,
herbicides and pesticide production and a total collapse of Industrial Civilisation.
In anticipation of increasing Crude Oil imports, Nixon stopped the convertibility of
Dollars into Gold, thus making the Dollar entirely fiat, allowing them to print as much of
the currency as they needed.
They also began a system of obscuring oil production data, involving the DoE's EIA and the
OECD's IEA, by inventing an ever-increasing category of Undiscovered Oilfields in their
predictions, and combining Crude Oil and Condensate (from gas fields) into one category (C+C)
as if they were the same thing. As well the support of the ethanol-from-corn industry began,
even though it was uneconomic. The Global Warming problem had to be debunked, despite its
sound scientific basis. Energy-intensive manufacturing work was off-shored to cheap
labour+energy countries, and Just-in-Time delivery systems were honed.
In 2004 the price of Crude Oil rose from $28 /barrel up to $143 /b in mid-2008. This
demonstrated that there is a limit to how much business can pay for oil (around $100 /b).
Fracking became marginally economic at these prices, but the frackers never made a profit as
over-production meant prices fell to about $60 /b. The Government encourages this destructive
industry despite the fact it doesn't make any money, because the alternative is the end of
Industrial Civilisation.
Eventually though, there must come a time when there is not enough oil to power all the
cars and trucks, bulldozers, farm tractors, airplanes and ships, as well as manufacture all
the wind turbines and solar panels and electric vehicles, as well as the upgraded
transmission grid. At that point, the game will be up, and it will be time for WW3. So we
need to line up some really big enemies, and develop lots of reasons to hate them.
Thus you see the demonisation of Russia, China, Iran and Venezuela for reasons that don't
make sense from a normal perspective.
The Polish leadership intends to implement a project of its own with the Baltic Pipe gas
pipeline - in face of the "Nord Stream - 2". This is reported by the German newspaper
Frankfurter Allgemeine Zeitung .
The Polish party "Law and Justice" decided to revive the Baltic Pipe project and connect to the
Norwegian gas network. According to press releases, at the end of last year the Polish state
oil and gas company PGNiG reserved the capacity of the gas pipeline for 15 years, at a cost of
two billion dollars. It is assumed that the Polish project with an annual capacity of 10
billion cubic meters per year will begin to function in 2022, but the final decision on this
project will be taken later in 2018.
Poland actively opposes the construction of the Russian "Nord Stream - 2". Earlier, the Polish
Prime Minister called on the US leadership to extend American sanctions for the implementation
of this project. In addition, he said that European companies involved in the construction of
the gas pipeline should be fined.
Germany has rebuffed such statements, stating that the project guarantees energy security for
Europe.
Nord Stream -2 is a project worth 9.5 billion euros, which involves the construction of two
lines of pipeline across the Baltic Sea from the coast of Russia to Germany. The total capacity
will be 55 billion cubic meters of gas per year.
F Y I :> Putin prefers Aramco to Trump's sword dance
Hardly 10 months after honoring the visiting US president, the Saudis are open to a
Russian-Chinese consortium investing in the upcoming Aramco IPO
By M.K. BHADRAKUMAR
FEBRUARY 16, 2018
[extract]
In the slideshow that is Middle Eastern politics, the series of still images seldom add up
to make an enduring narrative. And the probability is high that when an indelible image
appears, it might go unnoticed -- such as Russia and Saudi Arabia wrapping up huge energy
deals on Wednesday underscoring a new narrative in regional and international security.
The ebb and flow of events in Syria -- Turkey's campaign in Afrin and its threat to
administer an "Ottoman slap" to the United States, and the shooting down of an Israeli F-16
jet -- hogged the attention. But something of far greater importance was unfolding in Riyadh,
as Saudi and Russian officials met to seal major deals marking a historic challenge to the US
dominance in the Persian Gulf region.
The big news is the Russian offer to the Saudi authorities to invest directly in the
upcoming Aramco initial public offering -- and the Saudis acknowledging the offer. Even
bigger news, surely, is that Moscow is putting together a Russian-Chinese consortium of joint
investment funds plus several major Russian banks to be part of the Aramco IPO.
Chinese state oil companies were interested in becoming cornerstone investors in the IPO,
but the participation of a Russia-China joint investment fund takes matters to an entirely
different realm. Clearly, the Chinese side is willing to hand over tens of billions of
dollars.
Yet the Aramco IPO was a prime motive for US President Donald Trump to choose Saudi Arabia
for his first foreign trip. The Saudi hosts extended the ultimate honor to Trump -- a
ceremonial sword dance outside the Murabba Palace in Riyadh. Hardly 10 months later, they are
open to a Russian-Chinese consortium investing in the Aramco IPO.
Riyadh plans to sell 5% of Saudi Aramco in what is billed as the largest IPO in world
history. In the Saudi estimation, Aramco is worth US$2 trillion; a 5% stake sale could fetch
as much as $100 billion. The IPO is a crucial segment of Vision 2030, Saudi Crown Prince
Mohammad bin Salman's ambitious plan to diversify the kingdom's economy.
A production sharing agreement (PSA) between Royal Dutch Shell and Ukraine's Nadra Yuzivska
for the development of Yuzivske shale gas deposits located in Ukraine's Kharkiv and Donetsk
regions was signed in Davos on 24 January 2013 through the mediation of Ukrainian president
Viktor Yanukovych and Netherlands prime minister Mark Rutte. The agreement was inked by
Ukraine's energy and coal industry minister Eduard Stavitsky and Royal Dutch Shell CEO Peter
Voser.
Prior to the signing ceremony Yanukovych told journalists that Ukraine would benefit from
the agreement since it would allow attracting investments, which Ukraine could use to increase
the domestic natural gas production thus creating jobs, raising the level of the country's
economy as well as increasing the budget revenues and providing funds for social needs.
On 23 January Ukraine's cabinet of ministers approved a draft PSA between Shell Exploration
and Production Ukraine Investments B.V. and Nadra Yuzivska for Yuzivske shale gas field
(7,886m2 acreage) development.
Yuzivske field prognostic resources are estimated at 2-4trln m3 of gas, which can be a viable
alternative for costly natural gas volumes Ukraine imports form Russia. In the meanwhile US
Energy Information Agency (EIA) estimates Ukraine's shale gas potential at 1.2trln m3 in this
way making the country's shale gas reserves the 4th largest in Europe after Poland, France and
Norway. Totally consuming some 60bn m3 of natural gas annually, Ukraine has to import 40bn m3
of natural gas from Russia priced $430 per 1,000 m3 based on the terms of agreements inked in
2009.
Ukraine's prime minister Mykola Azarov stated earlier that Yuzivske field commercial
development over the span of a decade could give Ukraine an additional 8-10bn m3 of gas
annually.
As Eduard Stavitsky put it in Davos, Ukraine could possibly meet its domestic natural gas
demand in full in about 5 years of shale gas production cooperation with Shell. "According to
Shell's optimistic scenario about 20bn m3 of gas could be extracted annually; according to the
pessimistic one, at the very least 7-8bn m3. If the top forecasts were fulfilled, we would
tackle the gas shortfall problem in Ukraine or might even go into surplus", Stavitsky was
quoted as saying. He stated earlier that Shell saw investments under the deal of at least $10bn
under the most likely scenario and possibly as much as $50bn.
OILMARKET Info
In May 2012 Shell was chosen the successful bidder for 7,800km2 Yuzivske acreage (Kharkiv and
Donetsk regions, Ukraine) development with projected reserves estimated at 4.054trln m3 of gas
of various categories. The project calls for raising at least $20mn (UAH1.6bn) in investments
for the geological study phase, and $3.75bn (UAH30bn) for the industrial production phase. The
agreement envisages stage-by-stage exploration, development and hydrocarbons production. Both
companies (Shell and Nadro Yuzivske) will hold a 50% participation stake, with Shell chosen the
project operator responsible for carrying out works under the terms of agreement.
According to Shell press service, the mentioned PSA was signed for 50 years period. The
initial geological study phase at Yuzivske field implies 2D and 3D seismics as well as 15 well
drilling, which is expected to enable effective exploration and assessments of hydrocarbon
deposits potential especially that of natural gas trapped in compacted sandstone. Yuzivske
field development will be implemented in line with the highest international HSE standards. In
this way Shell is to carry out comprehensive possible environmental, social and public health
impact assessment of the project prior to launch.
2018-01-29 Chatham House Events – Iraqi Oil Minister confident that an oil export
capacity of five million barrels per day will be realized by the end of 2018 – a
"landmark in the oil industry"
Current Iraqi oil reserves of 153 billion barrels due to reach
175 billion in the coming years, says oil minister Luaibi at Annual MENA (Middle East &
North Africa) Energy conference
Iraq's oil minister Luaibi said the country seeks to ramp up refining capacity and reduce
imports of refined products :"I am determined that Iraq will become a product exporter
instead of product importer".
"... "The top American diplomat said his country is ready to help Poland continue to diversify its fuel supplies, including through the sale of U.S. liquefied natural gas, to reduce its dependence on Russia" ..."
Tillerson apes Hillary Clinton PR lines on Russia:
WARSAW (Reuters) - The United States sees the planned Nord Stream 2 gas pipeline between
Russia and Germany as a threat to Europe's energy security, U.S. Secretary of State Rex
Tillerson said on Saturday.
The rest of the Reuters article is garbage, so I'm not bothering with a link. . . Bloomberg
seems to spell out the larger rationale, at least:
"The top American diplomat said his country is ready to help Poland continue to diversify its
fuel supplies, including through the sale of U.S. liquefied natural gas, to reduce its
dependence on Russia"
Notice also that Secretary of Defense Mattis says that the US military is now focused on
"Great Power Conflicts" - so what is this, right back to the Hillary Clinton gameplan? At
least, Trump is unlikely to get any international support for reckless military actions, so
that's one good thing about him over Clinton.
LNG tanker Gaselys was scheduled to arrive in Boston Saturday. Vessel reversed course to
Spain after almost 21 days en route
... ... ...
While unusual, it's not unheard of for LNG cargoes that aren't tied into a contract with
fixed destination to change course en route as cargo owners seek the highest price and the best
market. Companies with access to wide global supplies can also swap shipments between regions.
What's more, the tanker may still make it to Boston with a delay, as was the case with
deliveries earlier this month, according to Kpler SAS, a cargo-tracking company.
"We have still not canceled the Everett port call for Gaselys," Madeleine Overgaard, an LNG
market analyst at Kpler, said by email. "Her course is currently not very different from the
average delivery at Everett in 2017, she is probably just diverting to delay arrival."
Engie SA's North American unit bought the spot cargo for delivery to the U.S. from
Malaysia's Petroliam Nasional Bhd. to supplement its contracted volumes from Trinidad and
Tobago into its Everett terminal near Boston, it said last week. Engie declined to comment on
the tanker's movement on Friday.
The Yamal LNG project, co-owned by Russia's Novatek PJSC, Total SA, China Natural Petroleum
Corp. and China's Silk Road Fund, started production in December despite U.S. financial
sanctions imposed in 2014 because of Russia's involvement in the Ukrainian conflict. It plans
to deliver 14 spot cargoes by April, when long-term contracts kick in.
With the opening of the new ESPO oil pipeline connecting Siberia to China doubling the
amount of oil China can import to 600,000 barrels per day we'll see those numbers continue to
accelerate.
And that's the key. Remember, the massive $400 billion gas deal China made with Gazprom in
2014 hasn't begun delivering gas. The first Power of Siberia pipeline isn't due to be completed
until 2019. The second Power of Siberia pipeline is on the table after this one.
And the two countries just agreed to a third pipeline to bring gas in from Russia's far east
last month.
So, despite back-biting from western media about the profitability of these projects, they
are going forward and the two countries continue to strengthen fundamental ties to one
another.
... ... ...
The important takeaway is that China has created the first unassailable and above-ground
challenge to the petro-dollar oil trade. To break the world's use of the dollar as the sole
settlement currency for oil required the right contract issued by a country the U.S. can't
immediately invade and conduct a regime change operation in – like in Iraq and Libya.
Russia wins here because now there is a path for its Urals grade to become an international
benchmark like WTI and Brent. And since Gazprom prefers to price its long-term gas contracts
based on underlying oil prices rather than the more volatile natural gas price, this is also a
win in the long run for them.
Gold convertibility is a means to deepen China's sovereign debt markets by making it less
risky to hold Chinese bonds. The lack of true yuan convertibility is the big impediment to
people holding them. So, gold convertibility creates a viable exit route.
Bob, when you control 40% of the World's Oil & Gas Reserves and can turn the tap on
and off then you can hardly be considered POOR, especially when you make up 20% of the
world's Land Mass ( am also thinking Fresh Water ).
Vichy DC's Sanctions on Russia are in Essence, Sanctions on Exxon & the Majors (who
soon won't be Majors at this rate ) and the EUROPEAN UNION.
The vice tightens inexorably and US foreign policy thrashes about in response to the
pressure. What will the parasitic Jewish overlords do to save their declining host?
According to one source out of the Far East, China's Yuan denominated oil contract is set to
go live for trading on Jan. 18.
While not an official date announced from government sources, according to an anonymous
member of the Futures market where the new oil contract will trade, this is the expected date
for Beijing to begin its latest challenge to the long-standing Petrodollar system.
According to the Shanghai-based news portal Jiemian, which cited an unidentified person from
a futures company, trading is expected to start Jan. 18.
Multiple rounds of testing have been carried out and all listing requirements met. The State
Council, China's cabinet, was said to have given its approval in December,
one of the final regulatory hurdles. The push for oil futures gained impetus in 2017 when
China surpassed the U.S. as the world's biggest crude importer. -
Zerohedge
While the Chinese markets are not expected to immediately take dominion over the
West's Brent and WTI oil markets, several countries which include Venezuela, Russia, Qatar,
Pakistan, and perhaps even Iran appear ready to transition away from dollar based oil trade.
Additionally, many more nations will likely be willing to dip their toes into this market as it
proves itself to be a viable alternative to dollar hegemony, and as protection from foreign
policy threats from the U.S. which often uses the dollar as leverage in economic sanctions.
Are companies which produce it profitable or they survive by generating a parallel stream
of junk bonds and evergreen loans?
Most of them are also shale oil producers and might well depend on revenue from shale oil
to produce gas. Shale oil proved to unsustainable at prices below, say $65-$75 per barrel or
even higher, excluding few "sweet spots". Also a lot of liquids the shale well produce are
"subprime oil" that refiners shun.
They are not only much lighter but also they have fewer hydrocarbons necessary for
producing kerosene and diesel fuel. Mixing it with heavy oil proved to be double edged sword
and still inferior to "natural" oil. So right now the USA imports "quality" oil and sells its
own" subprime oil" at discount to refineries that are capable of dealing with such a mix.
Say, buying a barrel for $60 and selling a barrel of "subprime oil" at $30.
And without revenue from oil and liquids it can well be that natural gas production might
be uneconomical.
I wonder what percentage of the total US oil production now is subprime oil.
Modern multistage shale well now cost around $7-10 million. And that's only beginning as
its exploitation also costs money (fuel, maintenance, pumping back highly salinated and often
toxic water the well produces, etc). So neither oil nor gas from such wells can be very
cheap.
Generally such a well is highly productive only the first couple of years. After that you
need to drill more.
Also there is a damage to environment including such dangerous thing as pollution of
drinking water in the area,
From what I can tell, in Europe there was a policy of encouraging LNG terminals in order
to provide leverage against Russian supply. But there seems to have been a significant
slowdown in construction – quite simply, LNG is too expensive relative to Russian and
domestic (Norwegian, Dutch, UK, Mediteranean) supplies. It makes much more sense for Europe
to broaden out its pipeline network. So I think the only appetite for US LNG comes from the
more anti-Russian eastern European countries such as Poland, which hates dependency on
Russian gas.
Poland would suffer without revenue from pipelines that transport Russian natural gas to
Western Europe. That's why they adamantly oppose North Stream II.
Not as much as Ukraine, for which it might mean the economic collapse, but still.
"... By Wolf Richter, a San Francisco based executive, entrepreneur, start up specialist, and author, with extensive international work experience. Originally published at Wolf Street ..."
"... Exports to Mexico via pipeline have been rising for years as more pipelines have entered service and as Mexican power generators are switching from burning oil that could be sold in the global markets to burning cheap US natural gas. The US imports no natural gas from Mexico. ..."
"... This is just the Sabine Pass export terminal. In addition, there are five other LNG export terminals under construction, according to the Federal Energy Regulatory Commission (FERC), with a combined capacity of 7.5 Bcf/d. This brings total LNG export capacity to over 11 Bcf/d over the next few years and will make the US the third largest LNG exporter globally, behind Australia and Qatar. ..."
"... According to the Institute of Energy Research, global LNG demand is currently around 37 Bcf per day. This is expected to grow substantially as China is shifting part of its power generation capacity from coal to natural gas. And US LNG exports to China have surged from nothing two years ago to 25.6 billion cubic feet in October (for the month, not per day): ..."
"... US natural gas production has been booming since 2009 as fracking in prolific shale plays took off, and the price has collapsed – it currently is below $3 per million British thermal units (mmBtu) at the NYMEX, despite tthe majestic cold wave that is gripping a big part of the country. ..."
"... This caused some immense price differences between the US market -- where a gas "glut" crushed prices, pushing them from time to time even below $2/mmBtu -- and, for example, the Japanese LNG import market, with prices that were in the $16-$17/mmBtu range in 2013 and 2014. Even the average spot price contracted in November 2017, the most recent data made available by the Ministry of Economy, Trade and Industry , was $9/mmBtu. US LNG exporters hope to arbitrage these price differentials. ..."
"... Meanwhile, US producers are hoping that this overseas demand will mop up the glut in the US and allow them to finally boost prices, including the prices LNG exporters pay. But funding continues pouring into the oil and gas sector to pump up production, and prices have remained low, and drillers continue to bleed. ..."
"... Poland may have one built but think about this – the Ukraine may be happy to pay for American coal which is twice as expensive as what they could buy from the Donbass regions but will Europe be happy to pay double or more for LNG from the US just to spite the Russians? ..."
By Wolf Richter, a San Francisco based executive, entrepreneur, start up specialist, and
author, with extensive international work experience. Originally published at
Wolf Street
Even China is Buying U.S. LNG
In 2017, the US became a net exporter of natural gas for the first time. It started small in
February, when the US exported 1 billion cubic feet more than it imported. By October, the last
month for which data from the Energy Department's EIA is available, net exports surged to 45
billion cubic feet. For the first 10 months of 2017, the US exported 86 billion cubic feet more
than it imported. And this is just the beginning.
Exports to Mexico via pipeline have been rising for years as more pipelines have entered
service and as Mexican power generators are switching from burning oil that could be sold in
the global markets to burning cheap US natural gas. The US imports no natural gas from
Mexico.
Imports from and exports to Canada have both declined since 2007, with the US continuing to
import more natural gas from Canada than it exports to Canada.
What is new is the surging export of liquefied natural gas (LNG) by sea to other parts of
the world.
This chart shows net imports (imports minus exports) of US natural gas. Negative "net
imports" (red) mean that the US exports more than it imports:
The first major LNG export terminal in the Lower 48 – Cheniere Energy's Sabine Pass
terminal in Cameron Parish, Louisiana – began commercial deliveries in early 2016 when
the liquefaction unit "Train 1" entered service. Trains 2 and 3 followed. The three trains have
a capacity of just over 2 billion cubic feet per day (Bcf/d). In October 2017, the company
announced that Train 4, with a capacity of 0.7 Bcf/d, was substantially completed and is likely
to begin commercial deliveries in March 2018. Train 5 is under construction and is expected to
be completed in August 2019. The company is now lining up contracts and financing for Train 6.
All six trains combined will have a capacity of 4.2 Bcf/d.
This is just the Sabine Pass export terminal. In addition, there are five other LNG export
terminals under construction, according to the
Federal Energy Regulatory Commission (FERC), with a combined capacity of 7.5 Bcf/d. This brings
total LNG export capacity to over 11 Bcf/d over the next few years and will make the US the
third largest LNG exporter globally, behind Australia and Qatar.
In addition, there are several other export terminals that FERC has approved but
construction has not yet started. And other projects are in the works but have not yet been
approved.
According to the Institute of Energy Research, global LNG demand is currently around 37 Bcf
per day. This is expected to grow substantially as China is shifting part of its power
generation capacity from coal to natural gas. And US LNG exports to China have surged from
nothing two years ago to 25.6 billion cubic feet in October (for the month, not per day):
US natural gas production has been booming since 2009 as fracking in prolific shale plays
took off, and the price has collapsed – it currently is below $3 per million British
thermal units (mmBtu) at the NYMEX, despite tthe majestic cold wave that is gripping a big part
of the country.
Exporting large quantities of LNG is a momentous shift for the US because it connects
previously landlocked US production to the rest of the world. Unlike oil, the US natural gas
market has largely been isolated from global pricing.
This caused some immense price differences between the US market -- where a gas "glut"
crushed prices, pushing them from time to time even below $2/mmBtu -- and, for example, the
Japanese LNG import market, with prices that were in the $16-$17/mmBtu range in 2013 and 2014.
Even the average spot price contracted in November 2017, the most recent data made available by
the Ministry of
Economy, Trade and Industry , was $9/mmBtu. US LNG exporters hope to arbitrage these price
differentials.
Meanwhile, US producers are hoping that this overseas demand will mop up the glut in the US
and allow them to finally boost prices, including the prices LNG exporters pay. But funding
continues pouring into the oil and gas sector to pump up production, and prices have remained
low, and drillers continue to bleed.
And there are already global consequences – including in Europe, where large regions,
including Germany, increasingly depend on natural gas from Russia as production in Europe is
declining. The new competition from the US – though it really hasn't started in earnest
yet since most of US LNG goes to places other than Europe at the moment – is already
reverberating through the Europe-Russia natural gas trade.
The first major LNG export terminal in the Lower 48 began commercial deliveries in early
2016
Hmmm, is this a case of build it and they will come? Somebody has to sink the capital in
to build a fleet of LNG containers which will take a decade to come online. Somebody also has
the build the LNG terminals as well as the infrastructure to go along with it.
Poland may
have one built but think about this – the Ukraine may be happy to pay for American coal
which is twice as expensive as what they could buy from the Donbass regions but will Europe
be happy to pay double or more for LNG from the US just to spite the Russians?
Consider this as well. That LNG terminal is in Louisiana. Which is in the Gulf. Which has all
those annual hurricanes. Which is getting worse through climate change. Would the Europeans
want to risk depending on American deliveries under these conditions? I will reword that.
Will the Europeans want to risk their economies over this? Last year they shut down the place
for a month for repairs. What if Hurricane Harvey had slammed into the place. How will the
Europeans be able to trust that a future Trump doesn't shut down LNG deliveries in winter
time to get them to commit to some American policy? Too many variables with no net gain and
all loss – on their part.
"... I fully agree that attacking Iran would be yet another disaster but I don't understand why Saudi Arabia is portrayed as an 'enemy', the 'real' one, no less, in alt-media circles like this. I mean let's be honest with ourselves. KSA is the definition of a vassal state. Has been so since the state established established relations with the USA in the 1940s and the status was confirmed during the 1960s under King Faisal. Oil for security. Why pretend that they have any operational clearance from the US? ..."
I fully agree that attacking Iran would be yet another disaster but I don't understand
why Saudi Arabia is portrayed as an 'enemy', the 'real' one, no less, in alt-media circles
like this. I mean let's be honest with ourselves. KSA is the definition of a vassal
state. Has been so since the state established established relations with the USA in the
1940s and the status was confirmed during the 1960s under King Faisal. Oil for security. Why
pretend that they have any operational clearance from the US?
Contrary to the popular view, Wahabism is necessary to keep the local population under
control. Particularly the minority Shia population who live along the eastern coast, an area,
which incidentally also has the all the oil reserves.
USA fully understands this. Which is why they not only tolerated Wahabism, but strongly
promoted it during Afghan jihad. The operation was by and large very successful btw.
It was only during the '90s when religion became the new ideology for the resistance
against the empire across the Muslim world. Zero surprise there because the preceding
ideology, radical left wing politics was completely defeated. Iran became the first country
in this pattern. The Iranian left was decimated by the Shah, another vassal. So the religious
right became the new resistance.
And as far as the KSA is considered, Wahabi preachers aren't allowed to attack the USA
anyway. If any individual preacher so much as makes a squeak, he will be bent over a barrel.
There won't be any "coming down very hard on Saudi Arabia" because USA already owns that
country.
So what's the answer? Well, props to Phillip as he understood – "it would also
require some serious thinking in the White House about the extent to which America's armed
interventions all over Asia and Africa have made many people hate us enough to strap on a
suicide vest and have a go."
Your analysis starts too late. The US supports Wahhabism and the House of Saud because
the pro-Arabic/Islamic English Elites of 1910 and 1920 and 1935 supported Wahhabism and
the House of Saud.
The British Empire 'made' the House of Saud,
Thinking it wise to use Wahhabism to control Shia Islam is like thinking it wise to
use blacks to control the criminal tendencies of Mexicans.
The key here is whether Russia will stop transit of gas via Ukraine or not.
Notable quotes:
"... A more far-reaching result from the Stockholm proceedings was the intention to void the traditional (Gazprom) formula for gas prices which is based on a linkage to the price of oil. Instead, the price of gas will be tied directly to the spot gas market such as the European hub. ..."
"... In traditional Gazprom contracts, the price of gas depends on the price of oil, and only up to 15% of the price is a spot gas component. For decades, this contractual linkage of the price of gas to oil was largely accepted as being open and fair. ..."
"... the Stockholm arbitration declared that Naftogaz must honor their contract, and buy from Gazprom 5 billion cubic meters of gas annually. As it turns out the "take or pay" clause remains in force, but the volume has been significantly reduced. ..."
"... The irony is that while this is a loss of face for Kiev politically, economically it benefits the Ukrainian consumer. To date, Ukraine's purchases of "reverse gas" from Europe has been far more expensive than that which was contracted reliably over the years by Gazprom. ..."
After 2014, Ukraine claimed that it was being overcharged, and therefore Naftogaz refused to
pay Gazprom their contracted price for gas. Instead, it paid unilaterally a different amount
that it subjectively considered "fair."
Gazprom, in keeping with mutually contracted terms and conditions, could only issue an
invoice for the resulting underpayment, and after Naftogaz still refused to pay (a debt of
approx. $2 billion), made any further deliveries of gas contingent on prepayment.
The arbitration additionally upheld Gazprom's position and denied Naftogaz any right to a
refund for gas priced between May 2011 and April 2014 or collect any of the claimed
"overcharged gas" totaling approximately $14 billion for that period. In sum, the price Kiev
claimed was "inflated" was judged as in Stockholm as baseless.
Therefore, the question of who is accountable and responsible for settling debt has been
clarified in Stockholm. Naftogaz must pay Gazprom $2 billion plus a fine calculated at 0.03%
per day for each day this debt remains unpaid. This fine has already reached $3 million since
the court decision on December 22nd, and if it not paid can reach an annualized figure of $216
million and still keep growing daily.
Like any political and economic story, there is quite a bit that does not make the flashy
headlines, but plays a role in contributing to the noise surrounding an issue. Naftogaz takes
satisfaction in that the settlement allowed that the gas price for the second quarter of 2014
was to be reduced from $485 to $352 per 1000 cubic meters, or 27%, thereby "saving" Ukraine
about $ 1.8 billion for 2014-2015. The price of $485 was in fact fixed for that one quarter,
and it was higher than the market price. The reason was that the March referendum and
subsequent reunification of Crimea within the Russian Federation happened then. Up until that
time, Russia had given Ukraine a discount of $100 per one thousand cubic meters of gas as
payment for renting the Crimean base for the Black Sea fleet. The Kharkov treaty with Ukraine
which dealt with the naval base was therefore canceled, as Crimea was once again Russia.
Without this discount, the price increased by that same discounted $100 in the contracted
quarterly price fix.
Key is Stockholm's recognition that the Russian gas price for Ukraine in 2011-2014 was fair,
which is much more important than the price fixed in that second quarter in question. It is
worth noting in the next third quarter of 2014 Gazprom was prepared to provide Ukraine with a
market price for gas again. However, as we all know today, since June 2014 Naftogaz has refused
to buy gas from Russia for political reasons and calling it an "aggressor nation."
A more far-reaching result from the Stockholm proceedings was the intention to void the
traditional (Gazprom) formula for gas prices which is based on a linkage to the price of oil.
Instead, the price of gas will be tied directly to the spot gas market such as the European
hub. Should this occur, then the future gas price for Ukraine will be linked to the cost of
fuel in the European hub. This would be a major departure from the traditional pricing Gazprom
has used for decades, and might set a precedent for other buyers of Russian gas, who might also
want to change their price formulation. In traditional Gazprom contracts, the price of gas
depends on the price of oil, and only up to 15% of the price is a spot gas component. For
decades, this contractual linkage of the price of gas to oil was largely accepted as being open
and fair.
Since 2014, Ukraine has been buying reverse gas from Europe at such European spot hub
prices, and it has so far been more expensive than the traditional Gazprom contract. It is also
worth noting that spot prices are far more volatile, are seasonally demand-affected, and as
winter is a peak consumption season the prices can and do increase dramatically.
Why did Gazprom take their initial large claims to court knowing beforehand that it would be
impossible to get the tens of billions of dollars from Naftogaz or Ukraine without ruining both
through default? The first reason is that a "take or pay" clause was a key and mutually agreed
covenant of the contractual relationship, not a point to be discarded unilaterally by any
single party. The second reason was as a response to Naftogaz multi-billion lawsuit on the
transit of gas from Russia through Ukraine to Europe. The Ukrainian side believes that Gazprom
should pay them extra for not sending 110 billion cubic meters of gas through pipelines
annually across Ukraine. In the transit contract, there is no obligation for any such volumes
to be transited through Ukraine's pipelines.
To sum up this drama, the Stockholm arbitration declared that Naftogaz must honor their
contract, and buy from Gazprom 5 billion cubic meters of gas annually. As it turns out the
"take or pay" clause remains in force, but the volume has been significantly reduced. How this
volume of 5 billion cubic meters was arrived at remains a mystery, but one which will surely
become clear over time. The political spin, however, will be interesting to observe since
Ukraine must now buy (and pay for) this Russian gas. How will Kiev explain now having to buy
Russian gas when since 2014 it stridently proclaimed it shall never buy fuel from "that
aggressor nation."
The irony is that while this is a loss of face for Kiev politically, economically it
benefits the Ukrainian consumer. To date, Ukraine's purchases of "reverse gas" from Europe has
been far more expensive than that which was contracted reliably over the years by Gazprom. Now
Kiev will have to find the funds to pay for Gazprom's gas, settle their debt and ever-growing
fines, plus meet the rest of their energy needs by purchasing expensive reverse gas from
Europe. It will take spin that is a lot more imaginative from Kiev to package this settlement
into a believable political victory, and very creative accounting to get the money to pay for
it.
After 2014, Ukraine claimed that it was being overcharged, and therefore Naftogaz refused to
pay Gazprom their contracted price for gas. Instead, it paid unilaterally a different amount
that it subjectively considered "fair."
Gazprom, in keeping with mutually contracted terms and conditions, could only issue an
invoice for the resulting underpayment, and after Naftogaz still refused to pay (a debt of
approx. $2 billion), made any further deliveries of gas contingent on prepayment.
The arbitration additionally upheld Gazprom's position and denied Naftogaz any right to a
refund for gas priced between May 2011 and April 2014 or collect any of the claimed
"overcharged gas" totaling approximately $14 billion for that period. In sum, the price Kiev
claimed was "inflated" was judged as in Stockholm as baseless.
Therefore, the question of who is accountable and responsible for settling debt has been
clarified in Stockholm. Naftogaz must pay Gazprom $2 billion plus a fine calculated at 0.03%
per day for each day this debt remains unpaid. This fine has already reached $3 million since
the court decision on December 22nd, and if it not paid can reach an annualized figure of $216
million and still keep growing daily.
Like any political and economic story, there is quite a bit that does not make the flashy
headlines, but plays a role in contributing to the noise surrounding an issue. Naftogaz takes
satisfaction in that the settlement allowed that the gas price for the second quarter of 2014
was to be reduced from $485 to $352 per 1000 cubic meters, or 27%, thereby "saving" Ukraine
about $ 1.8 billion for 2014-2015. The price of $485 was in fact fixed for that one quarter,
and it was higher than the market price. The reason was that the March referendum and
subsequent reunification of Crimea within the Russian Federation happened then. Up until that
time, Russia had given Ukraine a discount of $100 per one thousand cubic meters of gas as
payment for renting the Crimean base for the Black Sea fleet. The Kharkov treaty with Ukraine
which dealt with the naval base was therefore canceled, as Crimea was once again Russia.
Without this discount, the price increased by that same discounted $100 in the contracted
quarterly price fix.
Key is Stockholm's recognition that the Russian gas price for Ukraine in 2011-2014 was fair,
which is much more important than the price fixed in that second quarter in question. It is
worth noting in the next third quarter of 2014 Gazprom was prepared to provide Ukraine with a
market price for gas again. However, as we all know today, since June 2014 Naftogaz has refused
to buy gas from Russia for political reasons and calling it an "aggressor nation."
A more far-reaching result from the Stockholm proceedings was the intention to void the
traditional (Gazprom) formula for gas prices which is based on a linkage to the price of oil.
Instead, the price of gas will be tied directly to the spot gas market such as the European
hub. Should this occur, then the future gas price for Ukraine will be linked to the cost of
fuel in the European hub. This would be a major departure from the traditional pricing Gazprom
has used for decades, and might set a precedent for other buyers of Russian gas, who might also
want to change their price formulation. In traditional Gazprom contracts, the price of gas
depends on the price of oil, and only up to 15% of the price is a spot gas component. For
decades, this contractual linkage of the price of gas to oil was largely accepted as being open
and fair.
Since 2014, Ukraine has been buying reverse gas from Europe at such European spot hub
prices, and it has so far been more expensive than the traditional Gazprom contract. It is also
worth noting that spot prices are far more volatile, are seasonally demand-affected, and as
winter is a peak consumption season the prices can and do increase dramatically.
Why did Gazprom take their initial large claims to court knowing beforehand that it would be
impossible to get the tens of billions of dollars from Naftogaz or Ukraine without ruining both
through default? The first reason is that a "take or pay" clause was a key and mutually agreed
covenant of the contractual relationship, not a point to be discarded unilaterally by any
single party. The second reason was as a response to Naftogaz multi-billion lawsuit on the
transit of gas from Russia through Ukraine to Europe. The Ukrainian side believes that Gazprom
should pay them extra for not sending 110 billion cubic meters of gas through pipelines
annually across Ukraine. In the transit contract, there is no obligation for any such volumes
to be transited through Ukraine's pipelines.
To sum up this drama, the Stockholm arbitration declared that Naftogaz must honor their
contract, and buy from Gazprom 5 billion cubic meters of gas annually. As it turns out the
"take or pay" clause remains in force, but the volume has been significantly reduced. How this
volume of 5 billion cubic meters was arrived at remains a mystery, but one which will surely
become clear over time. The political spin, however, will be interesting to observe since
Ukraine must now buy (and pay for) this Russian gas. How will Kiev explain now having to buy
Russian gas when since 2014 it stridently proclaimed it shall never buy fuel from "that
aggressor nation."
The irony is that while this is a loss of face for Kiev politically, economically it
benefits the Ukrainian consumer. To date, Ukraine's purchases of "reverse gas" from Europe has
been far more expensive than that which was contracted reliably over the years by Gazprom. Now
Kiev will have to find the funds to pay for Gazprom's gas, settle their debt and ever-growing
fines, plus meet the rest of their energy needs by purchasing expensive reverse gas from
Europe. It will take spin that is a lot more imaginative from Kiev to package this settlement
into a believable political victory, and very creative accounting to get the money to pay for
it.
"... The new 55-page "America First" National Security Strategy (NSS), drafted over the course of 2017, defines Russia and China as "revisionist" powers, "rivals," and for all practical purposes strategic competitors of the United States. ..."
"... The NSS stops short of defining Russia and China as enemies, allowing for an "attempt to build a great partnership with those and other countries." Still, Beijing qualified it as "reckless" and "irrational." The Kremlin noted its "imperialist character" and "disregard for a multipolar world." Iran, predictably, is described by the NSS as "the world's most significant state sponsor of terrorism." ..."
"Russia and China ... have concluded that pumping the US military budget by buying US bonds
... is an unsustainable proposition ..." Pepe Escobar 12,072
198
The new 55-page "America First" National
Security Strategy (NSS), drafted over the course of 2017, defines Russia and China as
"revisionist" powers, "rivals," and for all practical purposes strategic competitors of the
United States.
The NSS stops short of defining Russia and China as enemies, allowing for an "attempt to
build a great partnership with those and other countries." Still, Beijing qualified it as
"reckless" and "irrational." The Kremlin noted its "imperialist character" and "disregard for a
multipolar world." Iran, predictably, is described by the NSS as "the world's most significant
state sponsor of terrorism."
Russia, China and Iran happen to be the three key movers and shakers in the ongoing
geopolitical and geo-economic process of Eurasia integration.
The NSS can certainly be regarded as a response to what happened at the BRICS summit in Xiamen last
September. Then, Russian President Vladimir Putin insisted on "the BRIC countries' concerns
over the unfairness of the global financial and economic architecture which does not give due
regard to the growing weight of the emerging economies," and stressed the need to "overcome the
excessive domination of a limited number of reserve currencies."
That was a clear reference to the US dollar, which accounts for nearly two-thirds of total
reserve currency around the world and remains the benchmark determining the price of energy and
strategic raw materials.
And that brings us to the unnamed secret at the heart of the NSS; the Russia-China "threat"
to the US dollar.
The CIPS/SWIFT face-off
The website of the China Foreign Exchange Trade System (CFETS) recently
announced the establishment of a yuan-ruble payment system, hinting that similar systems
regarding other currencies participating in the New Silk Roads, a.k.a. Belt and Road Initiative
(BRI) will also be in place in the near future.
Crucially, this is not about reducing currency risk; after all Russia and China have
increasingly traded bilaterally in their own currencies since the 2014 US-imposed sanctions on
Russia. This is about the implementation of a huge, new alternative reserve currency zone,
bypassing the US dollar.
The decision follows the establishment by Beijing, in October 2015, of the China
International Payments System (CIPS). CIPS has a cooperation agreement with the private,
Belgium-based SWIFT international bank clearing system, through which virtually every global
transaction must transit.
What matters, in this case, is that Beijing – as well as Moscow – clearly read
the writing on the wall when, in 2012, Washington applied pressure on SWIFT; blocked
international clearing for every Iranian bank; and froze $100 billion in Iranian assets
overseas as well as Tehran's potential to export oil. In the event that Washington might decide
to slap sanctions on China, bank clearing though CIPS works as a de facto sanctions-evading
mechanism.
Last March, Russia's central bank opened its first office in Beijing. Moscow is launching
its first $1 billion
yuan-denominated government bond sale. Moscow has made it very clear it is committed to a
long-term strategy to stop using the US dollar as their primary currency in global trade,
moving alongside Beijing towards what could be dubbed a post-Bretton Woods exchange system.
Gold is essential in this strategy. Russia, China, India, Brazil & South Africa are all
either large producers or consumers of gold – or both. Following what has been
extensively discussed in their summits since the early 2010s, the BRICS countries are bound to
focus on trading
physical gold .
Markets such as COMEX
actually trade derivatives on gold, and are backed by an insignificant amount of physical gold.
Major BRICS gold producers – especially the Russia-China partnership – plan to be
able to exercise extra influence in setting up global gold prices.
The ultimate politically charged dossier
Intractable questions referring to the US dollar as the top reserve currency have been
discussed at the highest levels of JP Morgan for at least five years now. There cannot be a
more politically charged dossier. The NSS duly sidestepped it.
The current state of play is still all about the petrodollar system; since last year, what
used to be a key, "secret" informal deal between the US and the House of Saud, is firmly in the
public domain .
Even warriors in the Hindu Kush may now be aware of how oil and virtually all commodities
must be traded in US dollars, and how these petrodollars are recycled into US Treasuries.
Through this mechanism, Washington has accumulated an astonishing $20 trillion in debt –
and counting.
Vast populations all across MENA (Middle East-Northern Africa) also learned what happened
when Iraq's Saddam Hussein decided to sell oil in euros, or when Muammar Gaddafi planned to
issue a pan-African gold dinar.
But now it's China who's entering the fray, following through on plans set up way back in
2012. And the name of the game is oil-futures trading priced in yuan, with the yuan fully
convertible into gold on the Shanghai and Hong Kong foreign exchange markets.
The Shanghai Futures Exchange and its subsidiary, the Shanghai International Energy Exchange
(INE) have already run four production environment tests for crude oil futures. Operations were
supposed to start at the end of 2017, but even if they start sometime in early 2018, the
fundamentals are clear: this triple win (oil/yuan/gold) completely bypasses the US dollar. The
era of the petro-yuan is at hand.
Of course, there are questions on how Beijing will technically manage to set up a rival mark
to Brent and WTI, or whether China's capital controls will influence it. Beijing has been quite
discreet on the triple win; the petro-yuan was not even mentioned in National Development and
Reform Commission documents following the 19th CCP Congress last October.
What's certain is that the BRICS countries supported the petro-yuan move at their summit in
Xiamen, as diplomats confirmed to Asia Times . Venezuela is also on board. It's
crucial to remember that Russia is number two and Venezuela is number seven among the world's
Top Ten oil producers. Considering the pull of China's economy, they may soon be joined by
other producers.
Yao Wei, chief China economist at Societe Generale in Paris, goes straight to the point,
remarking how "this contract has the potential to greatly help China's push for yuan
internationalization."
The hidden riches of "belt" and "road"
An extensive report by
DBS in Singapore hits most of the right notes linking the internationalization of the yuan
with the expansion of BRI.
In 2018, six major BRI projects will be on overdrive; the Jakarta-Bandung high-speed
railway, the China-Laos railway, the Addis Ababa-Djibouti railway, the Hungary-Serbia railway,
the Melaka Gateway project in Malaysia, and the upgrading of Gwadar port in Pakistan.
HSBC estimates that
BRI as a whole will generate no less than an additional, game-changing $2.5 trillion worth of
new trade a year.
It's important to keep in mind that the "belt" in BRI should be seen as a series of
corridors connecting Eastern China with oil/gas-rich regions in Central Asia and the Middle
East, while the "roads" soon to be plied by high-speed rail traverse regions filled with
– what else - un-mined gold.
A key determinant of the future of the petro-yuan is what the House of Saud will do about
it. Should Crown Prince – and inevitable future king – MBS opt to follow Russia's
lead, to dub it as a paradigm shift would be the understatement of the century.
Yuan-denominated gold contracts will be traded not only in Shanghai and Hong Kong but also
in Dubai. Saudi Arabia is also considering to issue so-called Panda bonds, after the Emirate of
Sharjah is set to take the lead in the Middle East for Chinese interbank bonds.
Of course, the prelude to D-Day will be when the House of Saud officially announces it
accepts yuan for at least part of its exports to China.
A follower of the Austrian school of economics correctly asserts that for
oil-producing nations, higher oil price in US dollars is not as important as market share:
"They are increasingly able to choose in which currencies they want to trade."
What's clear is that the House of Saud simply cannot alienate China as one of its top
customers; it's Beijing who will dictate future terms. That may include extra pressure for
Chinese participation in Aramco's IPO. In parallel, Washington would see Riyadh embracing the
petro-yuan as the ultimate red line.
An independent
European report points to what may be the Chinese trump card: "an authorization to issue
treasury bills in yuan by Saudi Arabia," the creation of a Saudi investment fund, and the
acquisition of a 5% share of Aramco.
Nations under US sanctions, such as Russia, Iran and Venezuela, will be among the first to
embrace the petro-yuan. Smaller producers such as Angola and Nigeria are already selling
oil/gas to China in yuan.
And if you don't export oil but are part of BRI, such as Pakistan, the least you can do is
replace the US dollar in bilateral trade, as Interior Minister Ahsan Iqbal is currently
evaluating.
A key feature of the geoeconomic heart of the world moving from the West towards Asia is
that by the start of the next decade the petro-yuan and trade bypassing the US dollar will be
certified facts on the ground across Eurasia.
The NSS for its part promises to preserve "peace through strength." As Washington currently
deploys no less than 291,000 troops in 183 countries and has sent Special Ops to no less than
149 nations in 2017 alone, it's hard to argue the US is at "peace" – especially when the
NSS seeks to channel even more resources to the industrial-military complex.
"Revisionist" Russia and China have committed an unpardonable sin; they have concluded that
pumping the US military budget by buying US bonds that allow the US Treasury to finance a
multi-trillion dollar deficit without raising interest rates is an unsustainable proposition
for the Global South. Their "threat" – under the framework of BRICS as well as the SCO,
which includes prospective members Iran and Turkey – is to increasingly settle bilateral
and multilateral trade bypassing the US dollar.
It ain't over till the fat (golden) lady sings. When the beginning of the end of the
petrodollar system – established by Kissinger in tandem with the House of Saud way back
in 1974 – becomes a fact on the ground, all eyes will be focused on the NSS
counterpunch.
China and Russia been dumping US bonds for a good while.
They just have to do it slowly, so they can get as much cash, to buy stolen discounted
gold with from the British Anglo Zionist Empire, as possible without tanking the
market.
The Federal reserve, prints currency, "loans" it to USA corporation, at USURY rates,
gives this currency to other "sovereign" puppet states such as Belgium, who then act like
they are buying the bonds for themselves.
It is a scam. Those who trust the USA/British Empire, will wind up with worthless
paper, while the Usury bankers, their bosses, China and Russia, will wind up with
gold.
All you USA worshipers should understand something.
He who has the gold, makes the rules.
Guess the western sheep are going to be the bitc#s of China and Russia for the next
century or so.
Hey Tim or whatever. Yep you always win huh? Vietnam, Afghanistan, Libya, Syria,
Sudan, .ring any bells I could go on but you have been embarrassed enough with your msm
drivel. Always the weak and defenseless you lily livered chicken's. You better avoid war
with the two most powerful countries in the world. Can you guess? and neither are you
pedos and babykillers. You make me sick and disgusted. Voted again the most threat to
world peace. Ussa, ussa, ussa. Proud are ya all. The time is coming where you reap what
you have sown and on that day I shall dance my happy dance that you feel what you and
your evil countrymen have wrought in the world in the name of democracy and freedom hope
it is on cable! You rotten to the core people!
Here here, the US Holocaust, countless millions killed all over the globe as the USA
plunders, wars and props-up evil, despot regimes. Bin Laden, Taleban, just two of the US
former best allies, how long can a 200 year old, degenerate country like the USA keep
sponging-off/ using exploiting the worlds billions to enrich itself? USA... infested with
drugs, crime, rust belts, slums, homeless, street bums VAST inequality.
The Empire sells other peoples gold to China and Russia everyday, having stole and
sold Americans gold long since.
Works like this.
The not Federal, and no Reserve(s) dollar, is worth about 1 cent, of a 1913, pre Usury
criminal banker scam "dollar".
That 1 % is swiftly loosing it's value.
To keep the American people, from realizing, the USA, is using them for cattle, stealing
their labor, through planned hyperinflation,:
Israhell/Washington crime cabal, dumps massive amounts of "paper gold and silver", on the
market, each and every damn day the rigged market is open, in order to artificially keep
the price of gold and silver way the hell below where it should be priced in federal
reserve currency.
This hide s the true inflation rate of the not federal and no reserves private Usury
Banker Currency, falsely identified as the "US Dollar".
Israhell/Washington DC, does not have the physical gold and silver to cover what they
sell.
It is a criminal scam.
Those who buy this paper gold and silver, small guy, will never be given physical for the
paper.
Small guy, traded green paper for white paper. Either will be worthless soon.
Sovereigns, can buy enough of it, to demand delivery of physical.
The day the British Anglo zionist Empire defaults delivering physical gold, to China and
Russia, for the paper gold, is the day the curtain comes down on the illusion of the USA
financial empire.
Washington DC knows this, China knows this, Russia knows this.
In order to buy time, Israhell/Washington DC, has stolen, sold at hugely discounted
prices, to keep the dollar scam alive, just a while longer, all the gold they were
supposably storing for safe keeping, of other sovereigns.
They have stolen privately held gold, which was stored in commercial banks and vaults for
"safe keeping.
They stole the gold which went missing from the basement vaults in the world trade
centers, before they set off the demolition charges.
Then they sold it.
They stole and sold Ukraines gold.
They stole and sold, Libya's gold.
They had intended to have already stole and sold Syria's gold.
They are fast running out of other peoples gold, to deliver to China and Russia at huge
discounts, to prop up the scam, just a while longer.
The day there is no more stolen gold to deliver to China and Russia, the music stops, all
the chairs are removed, this game of musical chars is over. Starving Americans will eat
their pets, rats, and each other.
Thanks Israhell!
Thanks Washington DC/USA.
I want more information on this. Isabella said a similar thing. I want to know more...
So the U$T's that are in actual fact worthless, Russia is using to buy gold at a huge
discount to what should be the true market rate; and then Russia is storing this. I
understand the storing thing. I'm a straight forward kind-of-a-guy. But its the U.$.T.'s
to Physical Gold I can't get my head around.
Why is the U.$. honouring what is a knife-to-its-throat deal that is very soon going
to result in the collapse of the U.$. dollar? And according to this forum fully 20% of
Russia's reserves are still held in fiat U.$.T's..?
Why would Russia hold such a large percentage if its reserves in what will be
worthless U.$.T.'s when it knows that the U.$. is going to try and scam Russia and
default..?
Picture a crime family.
Some branches are pure evil.
Some not so evil.
Some are very open about their evil.
Some are sneaky hypocrites who use the news media to white wash their crimes, and vilify
their victims.
BUT! And this is one huge BUT, they all know too much on each other to start talking
too damn much.
Also, their criminal Empire, (shearing/raping/murdering the sheep for fun and profit) is
all tied together. Common banks, common/interchangeable fiat currencies, Usury debt
practices.
Take part of it down, the other part will suffer great losses, if not go down with
them.
Russia, and China, has gotten tired of the British Anglo zionist Empire lording it over
them and treating them like red headed step children.
Russia and China, have not seen the Light, are not operating for the sake of their
people, but to keep themselves in power, by returning to the people, some of the wealth
they stole from the people to begin with
British Anglo zionist pig fkers Empire, is too greedy to return any of the stolen
loot.
The BAzE, have a let them eat grass like the animals they are elitist attitude.
China and Russia, are trying to position themselves to come out on top when the economic
reset happens.
They both were FORCED, by Empire, to both buy and hold, huge stashes of both Federal
reserve fiat currency, and bonds, to do business in the rest of the world.
The USA military is the enforcement arm for the BAzE.
USA military is corrupted, demoralized, veterans fked over royally, weapons do not work
as their purpose, was to steal the labor of the American working man and women, not to
produce weapons which worked as advertised.
Russia and China, will continue to buy gold, buy time, to get in a better position to
give Uncle Sugar's pedophilic ass both middle fingers.
It is in their interest to do so.
The owners of the British Anglo zionist Empire, have their personal vaults filled with
stolen gold.
The politicians you see, the Rothschild's even, are window dressing to hide the true
owners, and to protect the true owners asses during slave revolts, by offering, kings,
queens, politicians, bankers, heads to get chopped.
These owners have no loyalty to any other person, or country in the world. They see
themselves as the chess players, humanity as the pieces, the earth as their personal
chess board.
They do not give a FF about America, the American people, or the hand puppet political
whore of DC/USA.
The hand puppet whores, are too stupid, and corrupt anyway, to understand whats coming,
or to have the power, intelligence, or balls to stop it
There are all kinds of fun and wealth created, for deviant sick bastards, in creating,
and tearing down empires.
Besides, all the death and destruction gets them sexually excited
Takes years of study, experience with, and intuition, to begin to understand their evil,
and the way the world really works.
Whether someone started years back, educating themselves, preparing for whats coming,
will determine if they will enter the kill zone as a sheep or not.
The only protection sheep have, is the hope, the jackals will rape and murder some other
sheep, not them. That is why they will not stand up or speak up.
That is why they violently attack anyone wants to leave the herd mentality, everyone else
forced to be in the same sheep state as them,
They are afraid the jackal will notice them individually.
Herd numbers and hiding in the herd, are the cowards only protection
Any day now, any week, not very many months, can the scam go on.
In other words, Americans might want to bone up on delicious recipes for Rats, cats, and
their neighbors.
re: "China and Russia been dumping US bonds for a good while.
They just have to do it slowly, so they can get as much cash, to buy stolen discounted
gold with from the British Anglo Zionist Empire, as possible without tanking the
market."
I have been reading this for a while. But I've yet to see it in practice. Rosneft is
still accepting U.$. dollars for oil/gas transactions, the most recent of which I believe
was the gas shipment from St Petersburg to Poland..?
https://tomluongo.me/2017/1...
What you buy by petrodollars ?
Saudi .Arabia buys arms. But SA has got millions of unemployed people , because they
studied Islamic religion , wahabist fanaticism ... Further SA employs millions of workers
from other countries. And owns US assets in value over 1 trillion dollars. So what else
to buy , where to spend their petrodollars? Only get billions dollars arms ,that are in
couple years useless...Population hate the fully corrupt royal family in numbers
approximately 40 thousands princess as they have to get about 500 thousands yearly
salaries...For doing nothing , only to spend it everywhere...
Populations hate US presence in SA. Very much.
But the Great Satan~USA adore such scum as the vile Crooked Saudi royal family, the
snakehead USA ignore all their anti-democracy, anti- human rights their beheading, their
evil ways, they worship money the US swine, its all they see and lap-up, plus they have
Russia/ China /Iran to pick on and blame not their evil Saudi- swine arms buyers.
View
Hide
At the moment, because the US is illegally holding gold prices down using uncovered
shorts on paper gold, and at the same time has used sanctions to devalue the rouble,
Russia is producing oil at reduced - rouble - rates, selling it on the international
market for U$, [artificially inflated] and buying massive amounts of cheap gold with the
huge profits she is making.
Russia is singing all the way to the bank right now. The US backed itself into a corner
on this one it cannot get out from - short of waging war on Russia !!!
Why should anyone who is in love with gold be upset if someone is holding the price
down? It should be a wonderful time to buy.
Russia is MINING gold, its own gold.
It is a great time to buy, if you have some spare cash to store, I agree. It's just a
poor time if you need to realise your gold - you wont get the price for it you should.
But indeed, it's a buyers market. Yes, Russia has a fair bit of gold "reserves" just
sitting in the ground.
There is the face the beast lets you see, and the real face of the beast.
You do not think the beast is stupid enough to show it's real face to all the sheep?
Really?
The sheep who are given personal attention in private places, see the real face of the
beast, because it sexually excites the beast for the chosen sheep to die bleating in
terror.
Guess you just got here you friggin troll. You know nothing you shill. Go back to the
basement mom has brought you dinner and cookies n milk and let the grown men talk, now
that is a good boy bye. Sorry John I have disappointed my Mom said be nice but idiots
bother me. Say hi to your lovely Mom for me and God bless. Merry Christmas everyone! Got
your back as always.
Glad you are so confident in the currency, which has lost 99% of it's buying power
since 1913, when the not Federal and no Reserve(s) was forced on the American people by
the Usury Banker ancestors of the owners of the 'Fed", buying USA politicians.
Where did that 99% value go?
To the I%ters. You know, the pedophile elite.
They want it all, they are coming for the other 1% of the "dollar's" value.
They are coming for Social security, government pensions, private pensions, checking
accounts, any thing with any value.
Oh by the way, just cause you are ignorant of how things work, don't mean they don't
work that way, just means you are ignorant.
Have a wonderful day now!
See mother, i was nice to the bad person who was trying to run interference for pedophile
baby rapers.
Good to see someone else Awake! A good portion of the Sheep are still sleeping, they
think the National Debt and Zero Interest Rates mean nothing (in the Eurozone Interest is
Negative). The US Dollar is soon to be Toilet Paper! Our Military can only overthrow
small countries that defy the PetroDollar system. Now with so many doing it, John
Carleton is right, the National Debt and Retirements Accounts are basically equal. That
is why Obutthead set the start of grabbing them by creating the MYRA, the Theory is the
Sheep are to stupid to manage their own retirement accounts, so the Government would grab
them and put them in a so called safe investment called "Treasury's". Unfortunately the
SS Trust Fund has been raided and is broke, but they do have drawers full of Treasuries.
Trump has to immediately open public lands for Mining & Drilling! A normalization of
Interest Rates to 5-6% would consume Government Revenues just to pay Interest on the
Debt!
Will work like this, they may already be doing it quietly.
Take private pensions.
They are already in trouble, having stocks, bonds, commercial real estate holdings.
All of these will become worthless, or close to it.
Anything with value, currency, decimal dollars, will be taken by the Washington thieves,
and worthless US bonds which will probably never be redeemed, or redeemed for chump
change, will be put in their place by Washington, as they "protect" the retirement
accounts.
Old people will eat rats, each other, dog and cats, die without medical care and meds
which they can not afford.
Some will eat their pistols.
Not going to be nice or orderly.
'Frankland Coverup Sex Scandal,
(pedophile prostitution ring being run out of Reagan's White House)
http://www.johnccarleton.or...
All pedo's, should be given a fair trial, and a fair hanging. A pedophile which was
given a fair trial, and a fair hanging, never again, raped a child.
Amazing how that works.
Correct and very easy at any given moment to be converted in a GOLD.Just follow
dynamic Russia and China buying GOLD on a world market and everything will be clear to
you
While all eyes are on the oil price and the ruble to dollar rate, the Central Bank of
Russia has quietly been buying huge volumes of gold over the past year. In January, 2016,
the latest data available, the Russian Central Bank again bought 22 tons of gold, around
$800 million at current exchange rates, that, amidst US and EU financial sanctions and
low oil prices. It was the eleventh month in a row they bought large gold volumes. For
2015 Russia added a record 208 tons of gold to her reserves compared with 172 tons for
2014. Russia now has 1,437 tonnes of gold in reserve, the sixth largest of any nation
according to the World Gold Council in London. Only USA, Germany, Italy, France and China
central banks hold a larger tonnage of gold reserves.
Notably also, the Russian central bank has been selling its holdings of US Treasury debt
to buy the gold, de facto de-dollarizing, a sensible move as the dollar is waging de
facto currency war against the ruble. As of December, 2015, Russia held $92 billion in US
Treasury Bonds down from $132 billion in January 2014.China bought another 17 tons of
gold in January and will buy a total of another 215 tons this year, approximately equal
to that of Russia. From August to January 2016 China added 101 tonnes of gold to its
reserves. Annual purchases of more than 200 tons by the PBOC would exceed the entire gold
holdings of all but about 20 countries, according to the World Gold Council. China's
central bank reserves of gold have risen 57% since 2009 acording to data the PBOC
revealed in July, 2015. Market watchers believe even that amount of gold in China's
central bank vaults is being politically vastly understated so as not to cause alarm
bells to ring too loud in Washington and London.
Dude stop your only making yourself look stupid by opening your gob and proving or in
this case writing. Merry Christmas or is it happy Hanukkah? Troll boy.
alexwest11 You are stupid ! a flat or house is real money you know ! They are
uneducated in Rothschild finance! are you a russlanddeutsche! or jew from holy ukraine
like poroschenko ?
Russia National Debt: $194,545,062,334
Interest per Year $12,805,556,000
Interest per Second $406
Debt per Citizen $1,330
Debt as % of GDP 19.32%
GDP $1,007,000,000,000
Population 146,300,000
Russia is one of the largest Countries by land mass with a sparse population after the
breakup of the Soviet Union. They run very low deficits and their National Debt is very
low, they are one of the Countries that is best prepared for a major economic crash.
oncefiredbrass alexwest11 • 28 minutes ago Russia
is one of the largest Countries by land mass with a sparse population
after the breakup of the Soviet Union. They run very low defic
--------
but facts say quite opposite!!!!!!!!
during oil selloff of 2008*9 Russian ruble fall 50%, from 23 to 37 per$
during oil selloff of 2014*15 Russian ruble fall 250 %, from 33 to almost 90 per$
right now its about 60 per $ , still 100% devaluation from 2014
-------
i don't remember $ fall against euro or yen during 2000 or/and 2008 crises in USA
The fall of the Ruble was an attack or sanction by the Obama Regime over Ukraine. Why
not trying to look up the Debt to GDP ratio for Russia and then the US and then ask
yourself what economy is actually in a better position to withstand a Depression. Russia
almost has enough Gold to back all their currency. How much gold would it take to back
all the Treasuries and Dollars that the US has spread all over the world?
Hey let the grown men talk baby boy! You are spouting msm talking points you're trying
to debate the choir about hymns. Your not going to make anyone here see the light because
you have no truths behind or in front. Msm drivel. One simple question! Who took Berlin?
In ww2 of course!
Me too. The U.S. has become the evil empire. The bully on the world stage stealing
everyone's lunch money. I know it will devastate us in Canada, but I would still rather
see the U.S. economy crumble if it would cripple their war machine, than to see this
situation go on. Ron Paul was right: Instead of war, why not pursue peaceful trade? But
the U.S. controllers want everyone else under their thumb as obedient serfs. It is evil.
And as Smedley Butler so bluntly put it "War is a Racket"! He said this because he was
sent to war with Guatemala on behalf of the United Fruit Company, aka Chiquita Brands
International. This time, they are trying to steal the lunch money from those who can
defend themselves. We aren't going to sit on our couch watching this war on TV, because
we will watch it out our front windows.
"... By contrast the reduction in the gas price Naftogaz refers to from $485/tcm to $352 tcm which Naftogaz makes much of in its statement appears to apply only to gas supplied to Ukraine by Gazprom in the second quarter of 2014 and still sets the price of gas supplied to Ukraine by Gazprom higher than was demanded by Ukraine during this period. ..."
"... Ukraine recently borrowed $3 billion on the international financial markets at very high interest almost certainly in order to pay the $3 billion the High Court in London has ordered it to pay Russia. Whilst the $2 billion is technically a debt owed by Naftogaz not Ukraine and its non-payment would does not place Ukraine in a state of sovereign default, Gazprom is in a position to enforce the debt against Naftogaz's assets (including gas it buys) in the European Economic Area. It is difficult to see how Naftogaz and Ukraine can avoid payment of this debt. ..."
"... Has Ukraine actually gained anything from its long running gas dispute with Russia? ..."
On Friday 21st December 2017 the Stockholm Arbitration Court made a ruling in the legal
dispute between Ukraine's state owned gas monopoly Naftogaz and Russia's largely state owned
gas monopoly Gazprom.
In the hours after the decision – which like all decisions of the Stockholm
Arbitration Court – is not published, Naftogaz claimed victory in a short statement.
However over the course of the hours which followed Gazprom provided details of the decision
which suggests that the truth is the diametric opposite.
Here is how the Financial Times reports
the competing claims
Both Ukraine's Naftogaz and Russia's Gazprom both on Friday claimed victory as a Stockholm
arbitration tribunal issued the final award ruling in the first of two cases in a three-year
legal battle between the state-controlled energy companies, where total claims stand at some
$80bn.
An emailed statement from the Ukrainian company was titled:
"Naftogaz wins the gas sales arbitration case against Gazprom on all issues in
dispute."
The Stockholm arbitration tribunal -- in its final award ruling in a dispute over gas
supplies from prior years -- had, according to Naftogaz, struck down Gazprom's claim to
receive $56bn for gas contracted but not supplied through controversial "take-or-pay"
clauses. They were included in a supply contract Ukraine signed in 2009 after Gazprom dented
supplies to the EU by cutting all flow amid a price dispute -- including transit through the
country's vast pipeline systems. In a tweet Ukraine's foreign minister
Pavlo Klimkin wrote: "The victory of Naftogaz in the Stockholm arbitration: It's not a
knockout, but three knockdowns with obvious advantage."
But later Gazprom countered that arbitors "acknowledged the main points of the contract
were in effect and upheld the majority of Gazprom's demands for payment for gas supplies",
worth over $2bn. A Naftogaz official responded that the company never refused to pay for gas
supplied, but challenged price and conditions.
Given the tribunal does not make its decisions public, doubt loomed over which side was
the ultimate winner. Anticipation also grew over the second and final tribunal award expected
early next year over disputes both have concerning past gas transit obligations.
Friday's final Stockholm arbitration ruling follows a preliminary decision from last May
after which both sides were given time to settle monetary claims outside of the tribunal but
failed to reach agreement.
Here is the full Naftogaz statement:
"Today, the Tribunal at the Arbitration Institute of the Stockholm Chamber of Commerce has
completely rejected Gazprom take-or-pay claims to Naftogaz amounting to USD 56 billion for
2009-2017.
– Naftogaz succeeded at reducing future contract volume obligations by more than 10
times and made them relevant to its actual import needs.
– Price for gas off-taken by Naftogaz in 2Q 2014 reduced 27% from USD 485/tcm to USD
352/tcm. – Naftogaz saved USD 1.8 billion on gas purchased in 2014-2015 due to revision
of the contract price.
– Destination clause and other discriminatory provisions were declared invalid to
bring the contract in line with current European market standards.
– Naftogaz estimates the total positive financial effect of the arbitration over the
lifetime of the supply contract at over USD 75 billion.
– Naftogaz claims up to USD 16 billion in transit contract arbitration against
Gazprom; decision expected on 28 February 2018."
Gazprom said that in a separate decision on May 31 of this year, the tribunal denied
Naftogaz's application to review prices from May 2011 to April 2014, ordered it to pay $14bn
for gas supplies during that period, and said that the take-or-pay conditions applied for the
duration of the contract. Gazprom claimed that Naftogaz would have to pay it $2.18bn plus
interest of 0.03 per cent for every day the payments were late, and then pay for 5bn cm of
gas annually starting next year.
When the different sides give opposite accounts of the same decision it obviously becomes
difficult to say what the real decision actually is. However Gazprom says that the court upheld
(1) the main provisions of the contract; (2) the contract's take-or-pay provisions, these being
a particularly contentious issue in the contract; and (3) that Naftogaz has been ordered to pay
Gazprom $2 billion, presumably immediately, with interest for every day the amount is
unpaid.
By contrast the reduction in the gas price Naftogaz refers to from $485/tcm to $352 tcm
which Naftogaz makes much of in its statement appears to apply only to gas supplied to Ukraine
by Gazprom in the second quarter of 2014 and still sets the price of gas supplied to Ukraine by
Gazprom higher than was demanded by Ukraine during this period.
The key point here is that Russia agreed to reduce the price of gas supplied to Ukraine by
an agreement Russia's President Putin reached with Ukraine's President Yanukovich in December
2013. After the Maidan coup the new Ukrainian government went back on the agreement causing the
Russians to demand payment of the original price. However over the course of 2014, as energy
prices began first to slide and then crashed, and as it became clear that Ukraine was simply
not paying for its gas, Russia again reduced the price of the gas Ukraine had to pay.
What seems to have happened is that the Stockholm Arbitration Court decided to smooth out
the price of gas payable by Ukraine throughout 2014, which is the sort of thing arbitration
tribunals are regularly known to do, whilst leaving the essentials of the contract
unchanged.
If so then this is not a victory by Ukraine but a clearcut defeat, which Naftogaz and the
Ukrainian government have tried to spin into a victory by citing the reduction in the gas price
in the second quarter of 2014 and the reduction in future gas import volumes, neither of which
were contentious issues. By contrast it is clear that Ukraine and Naftogaz must pay the full
contractual price and abide by the contract's take-or-pay provisions for the whole of the
period of the contract prior to the second quarter of 2014.
What this means in terms of hard cash is that Ukraine must now pay Russia a further $2
billion on top of the $3 billion it was recently ordered to pay by the High Court in London.
Just as it is holding back on paying the $3 billion it was ordered to pay by the High Court
until the appeal process in London is finished, so it will try to hold off paying the $2
billion it has just been ordered to pay to Gazprom until the final decision of the Stockholm
Arbitration Court (thus the brave talk of Naftogaz's claims of "up to $16 billion transit
contract arbitration against Gazprom") but thereafter payment of the $2 billion will fall due.
I say this because the claim Gazprom owes Naftogaz "up to" $16 billion in transit fees looks
like it has been plucked out of the air.
What this means is that over the course of 2018 Ukraine will have to pay Russia $5 billion
($3 billion awarded by the High Court in London and $2 billion awarded by the Stockholm
Arbitration Court). Since the $2 billion awarded by the Stockholm Arbitration Court is
technically an arbitration award, Gazprom will need to convert it into a court Judgment before
it can enforce it, but that is merely a formality. At that point this debt will become not
merely due but legally enforceable as well.
Ukraine recently borrowed $3 billion on the international financial markets at very high
interest almost certainly in order to pay the $3 billion the High Court in London has ordered
it to pay Russia. Whilst the $2 billion is technically a debt owed by Naftogaz not Ukraine and
its non-payment would does not place Ukraine in a state of sovereign default, Gazprom is in a
position to enforce the debt against Naftogaz's assets (including gas it buys) in the European
Economic Area. It is difficult to see how Naftogaz and Ukraine can avoid payment of this
debt.
Has Ukraine actually gained anything from its long running gas dispute with Russia?
Naftogaz brags that Ukraine has saved up to $75 billion because it is no longer buying gas
from Russia. However this begs the question of whether the gas Ukraine is now importing from
Europe really is significantly cheaper than the gas Ukraine was buying from Russia? This is
debatable and with energy prices rising it is likely to become even less likely over time.
As reported by the permanent representative of the International Monetary Fund in the
Ukraine, Jost Longman, the Kiev authorities should increase Ukrainian gas tariffs to the level
of import parity. Longman argues that an increase in gas prices will have a positive effect on
the development of the free market and will teach the Ukrainians to use natural gas
economically. "In the end, the final goal is the implementation of a free gas market. On the
way to this, it is important to continue to adjust the price of gas in accordance with the
price of imports", said Longman. "One price for all types of consumer also eliminates the space
for corruptio," he added.
On 20 Dec., a court in Slovakia stopped gas supplies to "Naftogaz of Ukraine". The
decision was made pursuant to the decision of the Stockholm arbitration over a claim made by
the Italian company IUGas that its Ukrainian consumer owed it money.
The total amount of the claim, including interest and penalties, is approximately $21
million. An arbitration ruling was accepted on 19 December 2012 and relates to unpaid 2007
transactions .
Under international law, if the defendant has not fulfilled the resolution of the
arbitration, the plaintiff may apply to the courts of other states with a request that the
ruling be executed.
"Naftogaz of Ukraine" is analyzing the situation to determine its next steps, according
to the Ukrainian edition "Mirror of the Week".
For 11 months of 2017, "Naftogaz of Ukraine" had bought in Eastern Europe 20.9 billion
cubic metres of gas. Most of the supplies -- more than 8 billion cubic metres -- are in
Slovakia.
As written in iz.ru, arbitration is under consideration in Stockholm as regards the
lawsuit made by "Gazprom" against "Naftogaz", the decision on which will be issued by the court
no later than February next year. The adjusted amount of the claims made by the Russian company
was more than $ 37 billion.
All this is the Aggressor State's doing!
For the sake of freedom and democracy, the Ukraine must be supported!
Gazprom has responded to Naftogaz's statements about victory in court
The Stockholm arbitration has satisfied most of Gazprom's claims made against Naftogaz
Ukraine regarding payment for supplied gas, the company has said in a statement. In Moscow.
They stressed that the main demands of the Ukrainian side by the court had been
rejected.
The court did not recognize the right of Naftogaz to review the price of gas, the
deliveries of which were carried out from May 2011 to April 2014. Also, the Ukrainian side
was denied recovery of overpayment. Gazprom noted that the court found it necessary to apply
the "take or pay" principle (annual payment of a minimum amount of gas) before the expiry of
the contract.
"Naftogaz" has to pay back $2 billion in arrears and interest for late payment to
Gazprom. The Ukrainian side is also obliged from next year to take 5 billion cubic metres
from Russia annually.
Earlier on Friday, Naftogaz said that the court had awarded the victory to the
Ukrainian side. In Kiev, they stressed that Gazprom's "take-or-pay" requirements had been
"completely" rejected by the court, and the gas price for the second quarter of 2014 had been
lowered to $ 352 per thousand cubic metres.
The court considered contracts for the supply of gas from Russia to the Ukraine, as
well as gas transit through the Ukraine. They were signed back in 2009. The Ukraine, insisted
"Gazprom", did not get any gas 2012-2014, and also in individual quarters of 2015 and 2016.
"Naftogaz" asked the court to review the gas prices, and that overpayment be reimbursed and
that the ban on further resale of gas be cancelled.
Kremlin propaganda from a "Kremlin controlled" newspaper?
"Naftogaz won the gas sales arbitration case against Gazprom on all issues in dispute,"
Naftogaz said in an emailed statement.
It said the ruling was worth around $75 billion to Naftogaz in the long term, but
did not give a breakdown on how it reached the estimate. [My stress -- ME]
Meanwhile Gazprom said the court had satisfied most of Gazprom's claims and ruled that
the main terms of the contract between Naftogaz and Gazprom were valid.
Gazprom said the Stockholm court had ordered Naftogaz to pay more than $2 billion to
Gazprom for gas supply arrears and that it had also ordered Naftogaz to buy 5 bcm of gas from
Gazprom annually from 2018.
Estimated $75 billion in the "long term"?
Have to pay $2 billion to Gazprom in arrears now (not mention interest).
From 2018 (i.e. in just over a week's time) have to buy annually 5 bcm of gas off the
"aggressor state".
Of course; that's what Klimkin told them. Why should they check? Klimkin is always reliable,
and I'm sure he tweeted a press statement directly to them. Let them hold a Naftogaz victory
party if that's what they feel like doing. Just don't spend Russia's money on it. Because I
notice Ukraine has to pay Russia. I did not see anything in there about Russia having to pay
Ukraine. And so Ukraine can have all of that kind of victories it wants.
Ultimately, the court greatly reduced the amount of gas that Ukraine is contractually
obligated to buy from Russia. From 2018, "Naftogaz" should annually take and pay for up to 5
billion cubic metres instead of the original 52 billion cubic metres in any case it means the
resumption of gas purchases in Russia, which stopped in 2015, since when "Naftogaz" has been
buying all its fuel through reverse flow from Europe.
Investors should "think twice" about putting money into Nord Stream 2 due to
"uncertainties" around the Russian pipeline, the EU energy commissioner told
EUobserver.
"I would really think twice, or many more times, simply because there are a lot of
uncertainties," Maros Sefcovic said in an interview.
"It's the decision of the project promoters if they want to proceed in this atmosphere
which might lead to legal disputes down the line," he said
"Nord Stream 2 is supported by five major western European energy companies that have
each committed up to almost €1 billion to the implementation of the pipeline," the
consortium's Sebastian Sass said.
"It shows that there is both market demand and great confidence in Nord Stream 2," he
added.
Stefan Meister, an expert at the German Council on Foreign Relations, a think tank in
Berlin, also said Russia had little to worry about from the EU.
"In Germany the overall impression is, that the project will come Merkel is not against
it. That means she supports it," he said.
Meister said the fact Gazprom was prepared to dig into its own pockets meant "the
investment risks are limited". He added that energy companies were used to working "in an
even more risky environment" in other parts of the world.
"Except the US sanctions, there are no real risks to stop the project," he said
####
Plenty more of Sefcovic blowing hot air out of every orifice at the link. Did someone slip
him some cocaine instead of sugar in his coffee before the interview? All mouth and no
trousers.
Ukraine is overpaying for European gas & wants Russia to foot the bill
Yuzivske field prognostic resources are estimated at 2-4trln m3 of gas, which can be a viable alternative for costly natural gas volumes Ukraine imports form Russia. In the meanwhile US Energy Information Agency (EIA) estimates Ukraine's shale gas potential at 1.2trln m3 in this way making the country's shale gas reserves the 4th largest in Europe after Poland, France and Norway. Totally consuming some 60bn m3 of natural gas annually, Ukraine has to import 40bn m3 of natural gas from Russia priced $430 per 1,000 m3 based on the terms of agreements inked in 2009.
