Category:

West Tries to Loosen Russia's Gas Grip

Western officials are scrambling to loosen Russia’s energy stranglehold on Ukraine, the latest sign of growing pressure on Moscow to end the crisis. The options being considered by officials from Brussels to Washington include larger exports of U.S.-made natural gas, reversing the flow of natural gas through pipelines from Western Europe back into Ukraine, and accelerating plans across Europe to buy more energy from countries other than Russia. "If no solution to this can be found," European countries will "recast their approach to energy and economic links with Russia over time," U.K. Foreign Secretary William Hague said Sunday. Western officials also have threatened sanctions against Russia if the Kremlin continues its occupation of the Crimea region of Ukraine. The threats have failed so far, with Russian President Vladimir Putin declaring his support Sunday for Crimea’s move to secede from Ukraine. The region could join Russia as soon as this […]

Posted On : Published By : Tom Whipple
Category:

West Tries to Loosen Russia’s Gas Grip

Western officials are scrambling to loosen Russia’s energy stranglehold on Ukraine, the latest sign of growing pressure on Moscow to end the crisis. The options being considered by officials from Brussels to Washington include larger exports of U.S.-made natural gas, reversing the flow of natural gas through pipelines from Western Europe back into Ukraine, and accelerating plans across Europe to buy more energy from countries other than Russia. "If no solution to this can be found," European countries will "recast their approach to energy and economic links with Russia over time," U.K. Foreign Secretary William Hague said Sunday. Western officials also have threatened sanctions against Russia if the Kremlin continues its occupation of the Crimea region of Ukraine. The threats have failed so far, with Russian President Vladimir Putin declaring his support Sunday for Crimea’s move to secede from Ukraine. The region could join Russia as soon as this […]

Posted On : Published By : Tom Whipple
Category:

Ukraine, Russia and the nonexistent U.S. oil and natural gas "weapon"

Commentators were falling all over themselves last week to announce that far from being impotent in the Ukraine crisis, the United States had a very important weapon: growing oil and natural gas production which could compete on the world market and challenge Russian dominance over Ukrainian and European energy supplies–if only the U.S. government would change the laws and allow this bounty to be exported. But, there’s one very big problem with this view. The United States is still a net importer of both oil and natural gas. The economics of natural gas exports beyond Mexico and Canada–which are both integrated into a North American pipeline system–suggest that such exports will be very limited if they ever come at all. And, there is no reasonable prospect that the United States will ever become a net exporter of oil. Natural Gas Tank  (Image credit: Shutterstock ) U.S. net imports of […]

Posted On : Published By : Tom Whipple
Category:

Ukraine, Russia and the nonexistent U.S. oil and natural gas “weapon”

Commentators were falling all over themselves last week to announce that far from being impotent in the Ukraine crisis, the United States had a very important weapon: growing oil and natural gas production which could compete on the world market and challenge Russian dominance over Ukrainian and European energy supplies–if only the U.S. government would change the laws and allow this bounty to be exported. But, there’s one very big problem with this view. The United States is still a net importer of both oil and natural gas. The economics of natural gas exports beyond Mexico and Canada–which are both integrated into a North American pipeline system–suggest that such exports will be very limited if they ever come at all. And, there is no reasonable prospect that the United States will ever become a net exporter of oil. Natural Gas Tank  (Image credit: Shutterstock ) U.S. net imports of […]

Posted On : Published By : Tom Whipple
Category:

Gazprom Threatens Ukraine Supplies Over Late Payment

Gazprom said Friday it may suspend gas supply to Ukraine after Kiev failed to pay for February deliveries, but Russia’s gas monopoly said it will continue transit shipments to Europe. "We cannot supply gas for free. Either Ukraine redeems debt and pays for the current deliveries, or there is a risk to return to the situation of early 2009," Gazprom Chairman Alexei Miller said. Mr. Miller said that Ukraine now owes $1.89 billion for gas after it failed to meet a March 7 deadline for payment of the February deliveries. Russia switched off natural gas to Ukraine at the start of 2009 after talks on a new contract ended in failure. The failure of those talks lead to the temporary suspension of deliveries to Europe through Ukraine. But a spokesman for Gazprom said the current dispute with Ukraine wouldn’t have impact on supplies to the rest of Europe. […]

Posted On : Published By : Tom Whipple
Category:

Why Russia Can’t Afford Another Cold War

in 1958. The old Soviet Union was all but impervious to foreign economic or business pressure. Credit Agence France-Presse — Getty Images Russian troops pour over a border. An autocratic Russian leader blames the United States and unspecified “radicals and nationalists” for meddling. A puppet leader pledges fealty to Moscow. It’s no wonder the crisis in Ukraine this week drew comparisons to Hungary in 1956 and Czechoslovakia in 1968 or that a chorus of pundits proclaimed the re-emergence of the Cold War. But there’s at least one major difference between then and now: Moscow has a stock market. Continue reading the main story Under the autocratic grip of President Vladimir Putin , Russia may be a democracy in name only, but the gyrations of the Moscow stock exchange provided a minute-by-minute referendum on his military and diplomatic actions. On […]

Posted On : Published By : Tom Whipple
Category:

Russia Invokes $2 Billion Ukraine Gas Debt Amid Crimea Crisis

Andrew Wilson, chief executive officer for Europe, the Middle East and Africa at Goldman Sachs Asset Management, talks about investment opportunities in emerging markets, the crisis in Ukraine and the outlook for U.S. and China growth. He speaks with Francine Lacqua on Bloomberg Television’s "On the Move." (Source: Bloomberg) Russia said Ukraine’s natural gas debt climbed to almost $2 billion and signaled supplies may be cut, ratcheting up pressure on its neighbor as they scrap over the future of the Black Sea Crimea region. Ukraine hasn’t made its February fuel payment and owes Russia $1.89 billion, according to gas export monopoly OAO Gazprom (OGZD) , which halted supplies to Ukraine five years ago amid a pricing and debt dispute, curbing flows to Europe. Lawmakers in Moscow said they’d accept the results of a March 16 referendum on Crimea joining Russia as Arseniy Yatsenyuk, Ukraine’s premier, […]

Posted On : Published By : Tom Whipple
Category:

Moody’s: Ukraine line shutdown could cost Europe 56 bcm of gas

In the event of a complete stoppage in Russian natural gas transit via Ukraine, Europe will experience a gas deficit of as much as 56 billion cu m (bcm) during 2014, said Moody’s Investors Service in a recent Global Credit Research report. Such a shortfall would predominantly affect Italy, Turkey, France, the Czech Republic, Slovakia, and Austria. Warmer weather conditions, however, seasonal reductions in demand, and relatively high current gas stockpiles would to an extent mitigate the negative effects, Moody’s said. Ukraine also officially confirmed earlier this week that it would deliver gas to Europe under its 11-year transit agreement with Gazprom signed in 2009. The evolving situation in Ukraine adds uncertainty to the reliability of Gazprom’s natural gas exports via Ukraine’s 143 bcm/year Soviet-era pipeline network, which connects Gazprom’s gas transportation system with the European gas network in Poland, Slovakia, Hungary, Romania, and Moldova, said Moody’s. Prolonged turmoil […]

Posted On : Published By : Tom Whipple
Category:

EU leaders meet in Brussels to address Ukraine crisis

Pro-European protests in Ukraine ©EPA Ukraine’s economic situation has been described as ‘catastrophic’ EU leaders on Thursday will lead the west’s diplomatic efforts to counter Russia’s takeover of Crimea after a day of multiple setbacks when the Kremlin refused to engage with the new Ukrainian government and the allies were at loggerheads over how tough to be with Moscow. The emergency summit in Brussels comes as the US issued a detailed 10-point rebuttal of Russia’s “false narrative” about Ukraine. In addressing Russian claims that it has no troops in Ukraine, that its actions are legitimate and the Ukrainian government is illegitimate, the state department said: “The world has not seen such startling Russian fiction since Dostoyevsky.” David Cameron, UK prime minister, said on arriving at the summit that there were three points to address: Russia and Ukraine must open talks, the EU must show strong support for the Ukrainian […]

Posted On : Published By : Tom Whipple
Category:

EU weighs Russia sanctions as Ukraine diplomacy falters

European Union leaders were set to warn but not sanction Russia on Thursday over its military intervention in Ukraine after Moscow rebuffed Western diplomatic efforts to persuade it to pull forces in Crimea back to their bases. Russian Foreign Minister Sergei Lavrov refused to meet his new Ukrainian counterpart or to launch a "contact group" to seek a solution to the crisis at talks in Paris on Wednesday despite arm-twisting by U.S. Secretary of State John Kerry and European colleagues. The two men will meet again in Rome on Thursday. Tension remained high in Ukraine’s southern Crimea region, where a senior United Nations envoy was surrounded by a pro-Russian crowd, threatened and forced to get back on his plane and leave the country. An emergency EU summit in Brussels is unlikely to adopt more than symbolic measures against Russia, Europe’s biggest gas supplier, because neither industrial […]

Posted On : Published By : Tom Whipple