Please, a basic explanation to what’s happening: Re Russia and Ukraine
- Thread starter Kevo4
- Start date
Do you mean Kaliningrad in the Baltic region, not Murmansk in the Arctic/Barents? I was in Murmansk little over a month ago and it’s definitely connected to mainland Russia!
Thank you for asking this, I actually came on tonight to ask the same thing as I don't really understand it all. Next question....how worried should we be?? Will he just take Ukraine and climb back into his hole (as some are saying he's just trying to reclaim the old Soviet Union). I have a 14 Yr old daughter who obviously is reading/hearing things and I'd like to be clued up enough to answer them.
Jedi boro
Well-known member
The real answer is that no one aside from
Vlad really knows.
but Russian won’t poke the nato bear as it will only end one way.
At the moment it can be contained but what the implications of this conflict will be could be far reaching.
This map shows where the NATO buffer is
Last edited:
Randy
Well-known member
We don't know this for definite Zorro. How do we know China for example haven't given assurances to Russia that they would back them up if Russia are attacked directly by NATO?
Everything is guesswork at the moment.
Jedi boro
Well-known member
If they wanted to do that they’d be attacking Estonia not the Ukraine.
Russia know and fear nato that’s why they are acting now on a non member.
r00fie1
Well-known member
https://www.chinadaily.com.cn/a/202202/24/WS621724f6a310cdd39bc88b0d.html
The Ukrainian crisis has worsened with the United States, the United Kingdom, Germany, Japan and Australia imposing sanctions on Russia after Russian President Vladimir Putin recognized the independence of Ukraine's breakaway enclaves of Donetsk and Luhansk on Monday. But apart from geopolitical factors, other factors are also at play, most importantly, the fight for economic interests, behind the intensifying confrontation between the US and Russia over Ukraine.
The US' shale gas production has surged in recent years. Between 2016 and 2020, US natural gas production increased from 727.4 billion cubic meters to 914.6 billion cubic meters, accounting for 85 percent of the increase in global natural gas supply.
Rising production has also made the US one of the main exporters of natural gas in the world. For instance, the US exported 137.5 billion cubic meters of natural gas in 2020, accounting for 11 percent of the global natural gas trade, second only to Russia. By the end of this year, the US is likely to have the world's largest liquefied natural gas export capacity, by overtaking Australia and Qatar.
About 80 percent of the natural gas the US produces is consumed domestically, with rest being exported. About 55 percent of the natural gas the US exported in 2020 was supplied to Canada and Mexico through pipelines. It's hard for the US to further increase imports to the two countries, since Mexico has limited demands while Canada itself is a major natural gas producer too.
And although Mexico's demand for natural gas has not changed much, the same cannot be said about Canada, because it is one of the major natural gas producers in the world.
So the US is desperate to explore new buyers for its natural gas.
About 41.7 percent of the US' LNG exports in 2020 was destined for the European market, followed by Japan, the Republic of Korea and China, which together account for 30.6 percent. But China, whose demand for natural is high, imports only 5 percent of the US' LNG exports, which is unlikely to change given the worsening relations between the two sides.
Also, compared with the main LNG exporters to the Northeast Asian market such as Qatar and Australia, the US has many disadvantages such as high extraction costs and long transportation distances. Besides, in the medium to long term, US LNG will face fierce competition from high-quality but relatively cheap Russian pipeline natural gas. So it is difficult for the US to become the main LNG exporter to countries such as Japan and the ROK.
That is precisely why the strategic significance of the European market has become increasingly important for the US.
As the world's third-largest natural gas consuming region, Europe is highly dependent on natural gas imports and has long been the largest buyer of the US LNG. And the fact that Europe is expeditiously transforming its energy structure to achieve carbon neutrality has raised the demand for natural gas in the region, which the US wants to capitalize on.
But for years, Europe has been highly dependent on Russian pipeline gas. In fact, it imports more than 40 percent of its natural gas from Russia. Therefore, if the US wants to change the pattern of the existing natural gas market in Europe, it has to find a way to push Russia out of the European market.
Since the intensifying standoff between Russia and Ukraine and the resulting Western sanctions against Moscow will halt the supply of Russian natural gas to Europe creating fuel shortage in the region, the US sees it as a golden opportunity to increase its LNG exports to the region.
But the high cost of US LNG still makes it difficult for Washington to squeeze Moscow out of the European market. Russia's production cost has remained at $0.75-0.9 per million British thermal units (MMBtu) in recent years, while the US' shale gas extraction cost is about $1.6-3/MMBtu. Plus, the transportation cost of US LNG is also higher than Russian pipeline gas, because the US needs to supply the fuel across the Atlantic while Russia is close to the European market and has obvious advantages in terms of transportation cost.
The US LNG exports to Europe had been only marginally profitable, but the Ukraine crisis has made the business lucrative. The cost of US LNG to Europe is $5-8/MMBtu, and the Dutch TTF natural gas price was below this range for most of the past three years.
Before April 2021, the LNG trade between the US and Europe yielded meager profits for Washington. But after the Ukraine crisis broke out in March last year, the price of natural gas in Europe increased — in fact, it increased by 10 times from the beginning to the end 2021. LNG exports to Europe offers huge profit margins to the US, and it is estimated that in the second and third quarters of 2021 alone, the US' net profit from LNG trade with Europe exceeded $2 billion.
However, access to the European natural gas market is not the main reason why the US has triggered the Russia-Ukraine confrontation. But by doing so the US can pave the way for its huge investments in political, economic and military resources in eastern Ukraine.
No wonder the US Congress approved $200 million in new defense aid to Ukraine in December last year, and the US embassy in Kiev confirmed that parts of the aid arrived in the country on Jan 22. This is not only a sure bet compared with increasing LNG exports to Europe, but will also meet the US' long-term strategic interests and short-term economic interests.
The author is chief economist of Sealand Securities.
---------------------------------------------------------------------------------------------------------------------------------------------------------------------
www.state.gov
Ukraine’s Association Agreement with the EU gives the country preferential market access and is accelerating its economic integration with the bloc. Many U.S. companies have found success in Ukraine, particularly in the agriculture, consumer goods, and technology sectors. Ukraine is an agricultural powerhouse and the world’s second-largest grain exporter. Ukraine has long had a skilled workforce in the IT service and software R&D sectors. In recent months the Ukrainian government has increased its targeted recruitment of high-level IT talent into Ukraine.
Despite Ukraine’s potential, foreign direct investment (FDI) remains low. Ukraine experienced a net outflow of investment in 2020. In addition to the pandemic, foreign investors cite corruption, particularly in the judiciary, as a key challenge to doing business in Ukraine. To attract foreign investment the government adopted a new law in early 2021 granting considerable financial and operational incentives to companies that make large investments in Ukraine.
The April 2019 election of President Zelenskyy raised hopes that Ukraine would make the breakthrough reforms necessary to unlock its vast economic potential. The government has worked to protect the gains of recent years and to implement many of the administration’s promises. Vested and corrupt interests, however, have resisted and even succeeded in rolling back some of the critical reforms enacted since the 2014 Revolution of Dignity.
Since 2014, Ukraine passed numerous reforms, including the launch of a number of anti-corruption institutions. In fall 2020, however, the Constitutional Court of Ukraine invalidated key provisions of laws underpinning two of these institutions — the National Anti-Corruption Bureau (NABU) and the National Agency on Corruption Prevention (NACP). These rulings have rolled back key provisions of prior IMF programs, preventing new disbursements of IMF, World Bank, and EU concessionary loans. The Constitutional Court is also reviewing cases challenging the constitutionality of the High Anti-Corruption Court (HACC) and the Deposit Guarantee Fund. The government and parliament are negotiating with international partners on legislation to reverse the effects of the rulings.
War for gas behind Ukraine crisis
The Ukrainian crisis has worsened with the United States, the United Kingdom, Germany, Japan and Australia imposing sanctions on Russia after Russian President Vladimir Putin recognized the independence of Ukraine's breakaway enclaves of Donetsk and Luhansk on Monday. But apart from geopolitical factors, other factors are also at play, most importantly, the fight for economic interests, behind the intensifying confrontation between the US and Russia over Ukraine.
The US' shale gas production has surged in recent years. Between 2016 and 2020, US natural gas production increased from 727.4 billion cubic meters to 914.6 billion cubic meters, accounting for 85 percent of the increase in global natural gas supply.
Rising production has also made the US one of the main exporters of natural gas in the world. For instance, the US exported 137.5 billion cubic meters of natural gas in 2020, accounting for 11 percent of the global natural gas trade, second only to Russia. By the end of this year, the US is likely to have the world's largest liquefied natural gas export capacity, by overtaking Australia and Qatar.
About 80 percent of the natural gas the US produces is consumed domestically, with rest being exported. About 55 percent of the natural gas the US exported in 2020 was supplied to Canada and Mexico through pipelines. It's hard for the US to further increase imports to the two countries, since Mexico has limited demands while Canada itself is a major natural gas producer too.
And although Mexico's demand for natural gas has not changed much, the same cannot be said about Canada, because it is one of the major natural gas producers in the world.
So the US is desperate to explore new buyers for its natural gas.
About 41.7 percent of the US' LNG exports in 2020 was destined for the European market, followed by Japan, the Republic of Korea and China, which together account for 30.6 percent. But China, whose demand for natural is high, imports only 5 percent of the US' LNG exports, which is unlikely to change given the worsening relations between the two sides.
Also, compared with the main LNG exporters to the Northeast Asian market such as Qatar and Australia, the US has many disadvantages such as high extraction costs and long transportation distances. Besides, in the medium to long term, US LNG will face fierce competition from high-quality but relatively cheap Russian pipeline natural gas. So it is difficult for the US to become the main LNG exporter to countries such as Japan and the ROK.
That is precisely why the strategic significance of the European market has become increasingly important for the US.
As the world's third-largest natural gas consuming region, Europe is highly dependent on natural gas imports and has long been the largest buyer of the US LNG. And the fact that Europe is expeditiously transforming its energy structure to achieve carbon neutrality has raised the demand for natural gas in the region, which the US wants to capitalize on.
But for years, Europe has been highly dependent on Russian pipeline gas. In fact, it imports more than 40 percent of its natural gas from Russia. Therefore, if the US wants to change the pattern of the existing natural gas market in Europe, it has to find a way to push Russia out of the European market.
Since the intensifying standoff between Russia and Ukraine and the resulting Western sanctions against Moscow will halt the supply of Russian natural gas to Europe creating fuel shortage in the region, the US sees it as a golden opportunity to increase its LNG exports to the region.
But the high cost of US LNG still makes it difficult for Washington to squeeze Moscow out of the European market. Russia's production cost has remained at $0.75-0.9 per million British thermal units (MMBtu) in recent years, while the US' shale gas extraction cost is about $1.6-3/MMBtu. Plus, the transportation cost of US LNG is also higher than Russian pipeline gas, because the US needs to supply the fuel across the Atlantic while Russia is close to the European market and has obvious advantages in terms of transportation cost.
The US LNG exports to Europe had been only marginally profitable, but the Ukraine crisis has made the business lucrative. The cost of US LNG to Europe is $5-8/MMBtu, and the Dutch TTF natural gas price was below this range for most of the past three years.
Before April 2021, the LNG trade between the US and Europe yielded meager profits for Washington. But after the Ukraine crisis broke out in March last year, the price of natural gas in Europe increased — in fact, it increased by 10 times from the beginning to the end 2021. LNG exports to Europe offers huge profit margins to the US, and it is estimated that in the second and third quarters of 2021 alone, the US' net profit from LNG trade with Europe exceeded $2 billion.
However, access to the European natural gas market is not the main reason why the US has triggered the Russia-Ukraine confrontation. But by doing so the US can pave the way for its huge investments in political, economic and military resources in eastern Ukraine.
No wonder the US Congress approved $200 million in new defense aid to Ukraine in December last year, and the US embassy in Kiev confirmed that parts of the aid arrived in the country on Jan 22. This is not only a sure bet compared with increasing LNG exports to Europe, but will also meet the US' long-term strategic interests and short-term economic interests.
The author is chief economist of Sealand Securities.
---------------------------------------------------------------------------------------------------------------------------------------------------------------------
Ukraine - United States Department of State
www.state.gov
Executive Summary
Ukraine offers a large consumer market, a highly educated and cost-competitive work force, and abundant natural resources. The government continues to advance legislation to capitalize on this potential. In March 2020, parliament passed a law to lift the decades-old moratorium on the sale of agricultural land, effective July 1, 2021. The World Bank projects that the establishment of the agricultural land market could attract $5 billion in investment. Ukraine has continued to pass necessary legislation on intellectual property rights (IPR), including a new patent law bringing Ukraine’s patent regime closer in line with EU patent conventions. The government also launched a new centralized body to speed up the review and issuance of patents. On March 30, 2021, the Rada lifted a block on large privatizations and is looking at ways to facilitate the privatization process.Ukraine’s Association Agreement with the EU gives the country preferential market access and is accelerating its economic integration with the bloc. Many U.S. companies have found success in Ukraine, particularly in the agriculture, consumer goods, and technology sectors. Ukraine is an agricultural powerhouse and the world’s second-largest grain exporter. Ukraine has long had a skilled workforce in the IT service and software R&D sectors. In recent months the Ukrainian government has increased its targeted recruitment of high-level IT talent into Ukraine.
Despite Ukraine’s potential, foreign direct investment (FDI) remains low. Ukraine experienced a net outflow of investment in 2020. In addition to the pandemic, foreign investors cite corruption, particularly in the judiciary, as a key challenge to doing business in Ukraine. To attract foreign investment the government adopted a new law in early 2021 granting considerable financial and operational incentives to companies that make large investments in Ukraine.
The April 2019 election of President Zelenskyy raised hopes that Ukraine would make the breakthrough reforms necessary to unlock its vast economic potential. The government has worked to protect the gains of recent years and to implement many of the administration’s promises. Vested and corrupt interests, however, have resisted and even succeeded in rolling back some of the critical reforms enacted since the 2014 Revolution of Dignity.
Since 2014, Ukraine passed numerous reforms, including the launch of a number of anti-corruption institutions. In fall 2020, however, the Constitutional Court of Ukraine invalidated key provisions of laws underpinning two of these institutions — the National Anti-Corruption Bureau (NABU) and the National Agency on Corruption Prevention (NACP). These rulings have rolled back key provisions of prior IMF programs, preventing new disbursements of IMF, World Bank, and EU concessionary loans. The Constitutional Court is also reviewing cases challenging the constitutionality of the High Anti-Corruption Court (HACC) and the Deposit Guarantee Fund. The government and parliament are negotiating with international partners on legislation to reverse the effects of the rulings.
Steve8778
Well-known member
He attacks a NATO member and Putin will be blown away. He's not that stupid.
Gas, gas, gas
Putin has most of europe by the bollox. of all the sanctions announced, none of them prohibited the purchase of gas from Russia. The reason is that we are wholly dependant on it. Putin knows this.
The prophesised wars over natural resources are not far way.
So, we have some political gesturing about BIG sanctions but Putin has everybody in his pocket. He can cut the gas line and then our economies start to implode.
He is much more intelligent than any fuc.kwit the west has had in power and has slowly been using the western capitalist system to gain power and influence in every major government for 20 years.
London stinks of oligarchs and the money poured into the tory party as well as buying up half the fuc.king houses in the city.
Putin has most of europe by the bollox. of all the sanctions announced, none of them prohibited the purchase of gas from Russia. The reason is that we are wholly dependant on it. Putin knows this.
The prophesised wars over natural resources are not far way.
So, we have some political gesturing about BIG sanctions but Putin has everybody in his pocket. He can cut the gas line and then our economies start to implode.
He is much more intelligent than any fuc.kwit the west has had in power and has slowly been using the western capitalist system to gain power and influence in every major government for 20 years.
London stinks of oligarchs and the money poured into the tory party as well as buying up half the fuc.king houses in the city.
From what I've seen on the news its Italy and Germany who rely mainly on Russian gas and the UK about 10%, is that correct??
Stocko
Well-known member
it’s less than 5%, most of UK gas is from North Sea and Norway.
I believe the following to be correct, but I may be wrong in certain details. Either way it's what I've culled from various sources over the past few days of panicking over what is happening. I don't think Putin will go further than Ukraine. But Ukraine will be demilitarised. Who knows what happens after that. In his speech the other day he claims not to want to occupy the country.
www.aljazeera.com
When the Soviet Union was formed, Lenin and Stalin (Stalin was head of the People's Commissariat for Nationalities after the revolution) redrew the administrative boundaries of the various republics to include Russian minorities in most provinces. This was in order to dilute the national identity of both Russians and the various ethnicities. When the Soviet Union collapsed it was because Russia withdrew first. The other republics retained their administrative boundaries, leaving Russian minorities in each of the republics. These minorities were not the favourite people in places like Ukraine partly because of long memories of starvation when Soviet agriculture collapsed under Stalin. This episode is known as the Holodomor.
When the USSR collapsed, the Americans agreed not to extend NATO further than the existing boundaries, but this commitment was discarded by President Clinton, and the Baltic states and others joined NATO much to Russia's annoyance.
In 2010 Viktor Yanukovich was elected President in Ukraine. He was from the Donetsk Oblast in eastern Ukraine and therefore favoured links with Russia. The US and EU weren't too happy about that, and in 2013 there was what was probably a CIA driven colour revolution (recordings of US leaders discussing who would be in government leaked later https://www.bbc.com/news/world-europe-26079957), and Yanukovich was deposed. The Russians weren't too happy that their man was given the boot, and the eastern part of Russia that is mostly Russian speakers decided to separate from Ukraine. A civil war ensued, and this was in part resolved with the Minsk Protocol, which specified Ukraine would provide special treatment for the Russian speakers in the Donbas region. There have been skirmishes ever since. Both separatist regions have repeatedly requested to be allowed to join Russia, but so far Putin has refused.
Despite the agreement, Ukraine has consistently failed to meet with the Russian speaking separatists, and last year the president of Ukraine had the opposition leader (Putin is his daughters godfather) put under house arrest and shut down the Russian language TV stations. I believe Russian isn't even a recognised language in Ukraine. Ukraine is the second most corrupt country in Europe after Russia. While Obama did not provide military equipment to Ukraine, he did provide billions of dollars in aid, but much of this money ended up in the pockets of oligarchs and politicians. Trump started exporting military equipment and last year $600 million US of military aid was provided to Ukraine allowing Ukraine to build up their military capability.
According to the Russians (so decide for yourself) in the last few weeks Ukraine has started firing rockets into separatist held areas, and as a result, Putin increased the number of troops on the border. The Ukrainian's increased that shelling recently, and so Putin went on Russian TV and after reviewing the history, stated that he was going to invade and "demilitarise" Ukraine. And then he did what he said he would do. Prior to the TV speech, the Russian Duma voted last week to recognise the Donbas regions as independent states.
Putin has been able to do this, because the rest of Europe is militarily weak, relying on the US for defence, and are also heavily dependent on Russian energy. And because the US is also weak. US elites are seeking a peaceful transition of power to China, and key US politicians and corporate leaders have very strong links with China. This has led to a power vaccuum. Evidently Putin thinks the US bark is worse than its bite. And maybe Putin has seen the US Army recruitment video. I attach a comparison between Chinese, Russian and US military recruitment video's.
Russia spends slightly more on its military than does the UK according to data I checked. China spends 5 times more and Russia 11 times more. Russia cannot possibly sustain a shooting war against the US for any length of time. They do have 6000 nuclear warheads similar to the USA. Each has way more than everyone else put together.
What Putin has done may be evil. But he had his reasons. And this could all have been avoided with better diplomacy from the West, or by Ukraine negotiating with the separatists. Just my opinion but it seems western political elites appeared to want war between Ukraine and Russia. Why is anyone's guess. If they didn't want war, they'd have agreed to a neutral Ukraine (a la Sweden or Switzerland) with Russia. If you keep poking someone in the eye, eventually he's going to turn on you.
‘No other option’: Excerpts of Putin’s speech declaring war
Before launching the biggest attack by one state against another in Europe since World War II, Putin made an address.
When the Soviet Union was formed, Lenin and Stalin (Stalin was head of the People's Commissariat for Nationalities after the revolution) redrew the administrative boundaries of the various republics to include Russian minorities in most provinces. This was in order to dilute the national identity of both Russians and the various ethnicities. When the Soviet Union collapsed it was because Russia withdrew first. The other republics retained their administrative boundaries, leaving Russian minorities in each of the republics. These minorities were not the favourite people in places like Ukraine partly because of long memories of starvation when Soviet agriculture collapsed under Stalin. This episode is known as the Holodomor.
When the USSR collapsed, the Americans agreed not to extend NATO further than the existing boundaries, but this commitment was discarded by President Clinton, and the Baltic states and others joined NATO much to Russia's annoyance.
In 2010 Viktor Yanukovich was elected President in Ukraine. He was from the Donetsk Oblast in eastern Ukraine and therefore favoured links with Russia. The US and EU weren't too happy about that, and in 2013 there was what was probably a CIA driven colour revolution (recordings of US leaders discussing who would be in government leaked later https://www.bbc.com/news/world-europe-26079957), and Yanukovich was deposed. The Russians weren't too happy that their man was given the boot, and the eastern part of Russia that is mostly Russian speakers decided to separate from Ukraine. A civil war ensued, and this was in part resolved with the Minsk Protocol, which specified Ukraine would provide special treatment for the Russian speakers in the Donbas region. There have been skirmishes ever since. Both separatist regions have repeatedly requested to be allowed to join Russia, but so far Putin has refused.
Despite the agreement, Ukraine has consistently failed to meet with the Russian speaking separatists, and last year the president of Ukraine had the opposition leader (Putin is his daughters godfather) put under house arrest and shut down the Russian language TV stations. I believe Russian isn't even a recognised language in Ukraine. Ukraine is the second most corrupt country in Europe after Russia. While Obama did not provide military equipment to Ukraine, he did provide billions of dollars in aid, but much of this money ended up in the pockets of oligarchs and politicians. Trump started exporting military equipment and last year $600 million US of military aid was provided to Ukraine allowing Ukraine to build up their military capability.
According to the Russians (so decide for yourself) in the last few weeks Ukraine has started firing rockets into separatist held areas, and as a result, Putin increased the number of troops on the border. The Ukrainian's increased that shelling recently, and so Putin went on Russian TV and after reviewing the history, stated that he was going to invade and "demilitarise" Ukraine. And then he did what he said he would do. Prior to the TV speech, the Russian Duma voted last week to recognise the Donbas regions as independent states.
Putin has been able to do this, because the rest of Europe is militarily weak, relying on the US for defence, and are also heavily dependent on Russian energy. And because the US is also weak. US elites are seeking a peaceful transition of power to China, and key US politicians and corporate leaders have very strong links with China. This has led to a power vaccuum. Evidently Putin thinks the US bark is worse than its bite. And maybe Putin has seen the US Army recruitment video. I attach a comparison between Chinese, Russian and US military recruitment video's.
Russia spends slightly more on its military than does the UK according to data I checked. China spends 5 times more and Russia 11 times more. Russia cannot possibly sustain a shooting war against the US for any length of time. They do have 6000 nuclear warheads similar to the USA. Each has way more than everyone else put together.
What Putin has done may be evil. But he had his reasons. And this could all have been avoided with better diplomacy from the West, or by Ukraine negotiating with the separatists. Just my opinion but it seems western political elites appeared to want war between Ukraine and Russia. Why is anyone's guess. If they didn't want war, they'd have agreed to a neutral Ukraine (a la Sweden or Switzerland) with Russia. If you keep poking someone in the eye, eventually he's going to turn on you.
Last edited:
https://www.chinadaily.com.cn/a/202202/24/WS621724f6a310cdd39bc88b0d.html
War for gas behind Ukraine crisis
View attachment 34467
View attachment 34468
The Ukrainian crisis has worsened with the United States, the United Kingdom, Germany, Japan and Australia imposing sanctions on Russia after Russian President Vladimir Putin recognized the independence of Ukraine's breakaway enclaves of Donetsk and Luhansk on Monday. But apart from geopolitical factors, other factors are also at play, most importantly, the fight for economic interests, behind the intensifying confrontation between the US and Russia over Ukraine.
The US' shale gas production has surged in recent years. Between 2016 and 2020, US natural gas production increased from 727.4 billion cubic meters to 914.6 billion cubic meters, accounting for 85 percent of the increase in global natural gas supply.
Rising production has also made the US one of the main exporters of natural gas in the world. For instance, the US exported 137.5 billion cubic meters of natural gas in 2020, accounting for 11 percent of the global natural gas trade, second only to Russia. By the end of this year, the US is likely to have the world's largest liquefied natural gas export capacity, by overtaking Australia and Qatar.
View attachment 34470
About 80 percent of the natural gas the US produces is consumed domestically, with rest being exported. About 55 percent of the natural gas the US exported in 2020 was supplied to Canada and Mexico through pipelines. It's hard for the US to further increase imports to the two countries, since Mexico has limited demands while Canada itself is a major natural gas producer too.
And although Mexico's demand for natural gas has not changed much, the same cannot be said about Canada, because it is one of the major natural gas producers in the world.
So the US is desperate to explore new buyers for its natural gas.
About 41.7 percent of the US' LNG exports in 2020 was destined for the European market, followed by Japan, the Republic of Korea and China, which together account for 30.6 percent. But China, whose demand for natural is high, imports only 5 percent of the US' LNG exports, which is unlikely to change given the worsening relations between the two sides.
View attachment 34471
Also, compared with the main LNG exporters to the Northeast Asian market such as Qatar and Australia, the US has many disadvantages such as high extraction costs and long transportation distances. Besides, in the medium to long term, US LNG will face fierce competition from high-quality but relatively cheap Russian pipeline natural gas. So it is difficult for the US to become the main LNG exporter to countries such as Japan and the ROK.
That is precisely why the strategic significance of the European market has become increasingly important for the US.
As the world's third-largest natural gas consuming region, Europe is highly dependent on natural gas imports and has long been the largest buyer of the US LNG. And the fact that Europe is expeditiously transforming its energy structure to achieve carbon neutrality has raised the demand for natural gas in the region, which the US wants to capitalize on.
View attachment 34473
But for years, Europe has been highly dependent on Russian pipeline gas. In fact, it imports more than 40 percent of its natural gas from Russia. Therefore, if the US wants to change the pattern of the existing natural gas market in Europe, it has to find a way to push Russia out of the European market.
Since the intensifying standoff between Russia and Ukraine and the resulting Western sanctions against Moscow will halt the supply of Russian natural gas to Europe creating fuel shortage in the region, the US sees it as a golden opportunity to increase its LNG exports to the region.
But the high cost of US LNG still makes it difficult for Washington to squeeze Moscow out of the European market. Russia's production cost has remained at $0.75-0.9 per million British thermal units (MMBtu) in recent years, while the US' shale gas extraction cost is about $1.6-3/MMBtu. Plus, the transportation cost of US LNG is also higher than Russian pipeline gas, because the US needs to supply the fuel across the Atlantic while Russia is close to the European market and has obvious advantages in terms of transportation cost.
The US LNG exports to Europe had been only marginally profitable, but the Ukraine crisis has made the business lucrative. The cost of US LNG to Europe is $5-8/MMBtu, and the Dutch TTF natural gas price was below this range for most of the past three years.
Before April 2021, the LNG trade between the US and Europe yielded meager profits for Washington. But after the Ukraine crisis broke out in March last year, the price of natural gas in Europe increased — in fact, it increased by 10 times from the beginning to the end 2021. LNG exports to Europe offers huge profit margins to the US, and it is estimated that in the second and third quarters of 2021 alone, the US' net profit from LNG trade with Europe exceeded $2 billion.
However, access to the European natural gas market is not the main reason why the US has triggered the Russia-Ukraine confrontation. But by doing so the US can pave the way for its huge investments in political, economic and military resources in eastern Ukraine.
No wonder the US Congress approved $200 million in new defense aid to Ukraine in December last year, and the US embassy in Kiev confirmed that parts of the aid arrived in the country on Jan 22. This is not only a sure bet compared with increasing LNG exports to Europe, but will also meet the US' long-term strategic interests and short-term economic interests.
The author is chief economist of Sealand Securities.
---------------------------------------------------------------------------------------------------------------------------------------------------------------------
Ukraine - United States Department of State
View attachment 34475
Executive Summary
Ukraine offers a large consumer market, a highly educated and cost-competitive work force, and abundant natural resources. The government continues to advance legislation to capitalize on this potential. In March 2020, parliament passed a law to lift the decades-old moratorium on the sale of agricultural land, effective July 1, 2021. The World Bank projects that the establishment of the agricultural land market could attract $5 billion in investment. Ukraine has continued to pass necessary legislation on intellectual property rights (IPR), including a new patent law bringing Ukraine’s patent regime closer in line with EU patent conventions. The government also launched a new centralized body to speed up the review and issuance of patents. On March 30, 2021, the Rada lifted a block on large privatizations and is looking at ways to facilitate the privatization process.
Ukraine’s Association Agreement with the EU gives the country preferential market access and is accelerating its economic integration with the bloc. Many U.S. companies have found success in Ukraine, particularly in the agriculture, consumer goods, and technology sectors. Ukraine is an agricultural powerhouse and the world’s second-largest grain exporter. Ukraine has long had a skilled workforce in the IT service and software R&D sectors. In recent months the Ukrainian government has increased its targeted recruitment of high-level IT talent into Ukraine.
Despite Ukraine’s potential, foreign direct investment (FDI) remains low. Ukraine experienced a net outflow of investment in 2020. In addition to the pandemic, foreign investors cite corruption, particularly in the judiciary, as a key challenge to doing business in Ukraine. To attract foreign investment the government adopted a new law in early 2021 granting considerable financial and operational incentives to companies that make large investments in Ukraine.
The April 2019 election of President Zelenskyy raised hopes that Ukraine would make the breakthrough reforms necessary to unlock its vast economic potential. The government has worked to protect the gains of recent years and to implement many of the administration’s promises. Vested and corrupt interests, however, have resisted and even succeeded in rolling back some of the critical reforms enacted since the 2014 Revolution of Dignity.
Since 2014, Ukraine passed numerous reforms, including the launch of a number of anti-corruption institutions. In fall 2020, however, the Constitutional Court of Ukraine invalidated key provisions of laws underpinning two of these institutions — the National Anti-Corruption Bureau (NABU) and the National Agency on Corruption Prevention (NACP). These rulings have rolled back key provisions of prior IMF programs, preventing new disbursements of IMF, World Bank, and EU concessionary loans. The Constitutional Court is also reviewing cases challenging the constitutionality of the High Anti-Corruption Court (HACC) and the Deposit Guarantee Fund. The government and parliament are negotiating with international partners on legislation to reverse the effects of the rulings.
China Daily? Isn’t that an official mouthpiece of the Chinese Communist Party? The US is forcing poor Putin to invade so they can take over European gas supplies?
Edit: I realise I’ve pushed back on a couple of your posts recently roofie, so please don’t take my questions as aggressive, that’s not my intention. I just don’t get your angle here? I know the US is not the benevolent world police, but I don’t see it as the boogeyman behind everything either.
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I believe the following to be correct, but I may be wrong in certain details. Either way it's what I've culled from various sources over the past few days of panicking over what is happening. I don't think Putin will go further than Ukraine. But Ukraine will be demilitarised. Who knows what happens after that. In his speech the other day he claims not to want to occupy the country.
‘No other option’: Excerpts of Putin’s speech declaring war
Before launching the biggest attack by one state against another in Europe since World War II, Putin made an address.
When the Soviet Union was formed, Lenin and Stalin (Stalin was head of the People's Commissariat for Nationalities after the revolution) redrew the administrative boundaries of the various republics to include Russian minorities in most provinces. This was in order to dilute the national identity of both Russians and the various ethnicities. When the Soviet Union collapsed it was because Russia withdrew first. The other republics retained their administrative boundaries, leaving Russian minorities in each of the republics. These minorities were not the favourite people in places like Ukraine partly because of long memories of starvation when Soviet agriculture collapsed under Stalin. This episode is known as the Holodomor.
When the USSR collapsed, the Americans agreed not to extend NATO further than the existing boundaries, but this commitment was discarded by President Clinton, and the Baltic states and others joined NATO much to Russia's annoyance.
In 2010 Viktor Yanukovich was elected President in Ukraine. He was from the Donetsk Oblast in eastern Ukraine and therefore favoured links with Russia. The US and EU weren't too happy about that, and in 2013 there was what was probably a CIA driven colour revolution (recordings of US leaders discussing who would be in government leaked later https://www.bbc.com/news/world-europe-26079957), and Yanukovich was deposed. The Russians weren't too happy that their man was given the boot, and the eastern part of Russia that is mostly Russian speakers decided to separate from Ukraine. A civil war ensued, and this was in part resolved with the Minsk Protocol, which specified Ukraine would provide special treatment for the Russian speakers in the Donbas region. There have been skirmishes ever since. Both separatist regions have repeatedly requested to be allowed to join Russia, but so far Putin has refused.
Despite the agreement, Ukraine has consistently failed to meet with the Russian speaking separatists, and last year the president of Ukraine had the opposition leader (Putin is his daughters godfather) put under house arrest and shut down the Russian language TV stations. I believe Russian isn't even a recognised language in Ukraine. Ukraine is the second most corrupt country in Europe after Russia. While Obama did not provide military equipment to Ukraine, he did provide billions of dollars in aid, but much of this money ended up in the pockets of oligarchs and politicians. Trump started exporting military equipment and last year $600 million US of military aid was provided to Ukraine allowing Ukraine to build up their military capability.
According to the Russians (so decide for yourself) in the last few weeks Ukraine has started firing rockets into separatist held areas, and as a result, Putin increased the number of troops on the border. The Ukrainian's increased that shelling recently, and so Putin went on Russian TV and after reviewing the history, stated that he was going to invade and "demilitarise" Ukraine. And then he did what he said he would do. Prior to the TV speech, the Russian Duma voted last week to recognise the Donbas regions as independent states.
Putin has been able to do this, because the rest of Europe is militarily weak, relying on the US for defence, and are also heavily dependent on Russian energy. And because the US is also weak. US elites are seeking a peaceful transition of power to China, and key US politicians and corporate leaders have very strong links with China. This has led to a power vaccuum. Evidently Putin thinks the US bark is worse than its bite. And maybe Putin has seen the US Army recruitment video. I attach a comparison between Chinese, Russian and US military recruitment video's.
Russia spends slightly more on its military than does the UK according to data I checked. China spends 5 times more and Russia 11 times more. Russia cannot possibly sustain a shooting war against the US for any length of time. They do have 6000 nuclear warheads similar to the USA. Each has way more than everyone else put together.
What Putin has done may be evil. But he had his reasons. And this could all have been avoided with better diplomacy from the West, or by Ukraine negotiating with the separatists. Just my opinion but it seems western political elites appeared to want war between Ukraine and Russia. Why is anyone's guess. If they didn't want war, they'd have agreed to a neutral Ukraine (a la Sweden or Switzerland) with Russia. If you keep poking someone in the eye, eventually he's going to turn on you.
I’ve posted more than enough on this subject so I’m not going to address all your points, some of which are in line with the Russian state, but the NATO non-expansion agreement is Russian propaganda, even Gorbachev has said those conversations didn’t take place and I’ve previously provided the quotes.
Also, trying to give Putin excuses and blaming this on Ukraine, elites, US etc… it’s like I’m watching Russia Today, which I usually try to avoid. Why should Ukraine be forced into neutrality? Is that it’s wishes? Better diplomacy from the west with a nation already occupying several parts of the country, de facto annexation of its Belarusian neighbour and destabilising various regions on its borders, when has diplomacy worked before? The only man who wanted war was Putin, the opinions of “elites” was irrelevant. You also think Ukraine decided to shell the Donbas whilst a massive army was massed on its borders looking for an excuse to invade?
Even most of the Russians I know aren’t buying all of the Russian official line, but it’s amazing how far it spreads.
FabioPorkpie
Well-known member
Ros Atkins is worth a follow about most topics, as his short and to the point explainers tend to deliver factual information without the drama and theatre of some journalists.
FabioPorkpie
Well-known member
Sanctions -
r00fie1
Well-known member
I leave people to make their own minds up.
Fair enough. I really don’t think anyone (let alone the US which was actively pivoting away from Eastern European affairs prior to this) has manipulated Putin into war, it’s all his own doing and could have been avoided at countless points along the way and the Russian gas would be nicely flowing - Putin has ranted his bizarre reasons for the war including development of nuclear weapons and Nazism, but peace with Ukraine would not threaten the gas supplies, war would though, which he started off his own bat.
A media source from the authoritarian CCP which has allied itself to Putin is unlikely to be a reliable source. That’s my mind.
Beverleyred
Well-known member
That’s what the ICBM submarines are designed for. Does the deterrent become the aggressor? Let’s hope not, we don’t want any Hunt for Red October scenarios.