Russian Economy General News: #5

Austin wrote:

par far wrote:I just want this confirmed, this came out a while back, is this true? Did Russia get back it's oil stocks back?

http://inserbia.info/today/2014/12/grandmaster-putin-russia-earns-20-bln-recovers-stocks-of-its-companies/

I read that before but was there a buy back of stock in reality ?

Well Most US companies are running till date because they buy back their stocks from the profit they earn . Eg.Apple etc otherwise they would have applied for bailout.



@Garry- Russia has cancelled Turkish Stream project for start. Don't know whether they will revive south stream or simply push for Nord Stream 2 .

Though, still will need time catch up but it grows at twice the rate EU LP

The upside of devaluation.

KoTeMoRe wrote:The upside of devaluation.

You should look at the time axis. What devaluation are you talking about? The ruble to dollar exchange
rate was around 27-35:1 over the whole period that the productivity was increasing. So it clearly has
nothing to do with any devaluation.

Silk Road without Russia?

http://lenta.ru/news/2015/11/30/transkasp/

Turkey and China, together with Kazakhstan, Azerbaijan and Georgia have established a consortium of shipping goods from China to Europe, bypassing Russia. The agreement was signed on November 28 between representatives of large transport and logistics operators in Istanbul. This is reported by Interfax, referring to the statement of the press service of Georgian Railways.

The only obstacle that I see in this plan is the Caspian Sea, because these countries would have to ship the goods over the Caspian Sea if they want to avoid using Russian railways.

This seems like a stab in the back by China, Kazakhstan and other supposed Russian partners.

Turkey does.

Karl Haushofer wrote:Silk Road without Russia?

http://lenta.ru/news/2015/11/30/transkasp/

Turkey and China, together with Kazakhstan, Azerbaijan and Georgia have established a consortium of shipping goods from China to Europe, bypassing Russia. The agreement was signed on November 28 between representatives of large transport and logistics operators in Istanbul. This is reported by Interfax, referring to the statement of the press service of Georgian Railways.

The only obstacle that I see in this plan is the Caspian Sea, because these countries would have to ship the goods over the Caspian Sea if they want to avoid using Russian railways.

This seems like a stab in the back by China, Kazakhstan and other supposed Russian partners.

Stab in the back? Why would goods going across the Caspian, Transcaucasus and Turkey need to cross Russian territory?

This is just another alternative route to the China-Kazakhstan-Russia-Belarus one. And it makes sense to have several alternative routes for the Silk Road project.
It makes sense for China to not put all their eggs in one basket and be dependent on any 1 set of countries (however close relations may now be), and it also makes sense for Kazakhstan to position itself at the conflux of 2 or more routes as opposed to one and make itself the one country that is indispensable to China.

There is no backstabbing here, just economic and political common sense on the part of all countries involved.

BTW, Russia is also working on its own corridors; Northern Sea Route, Japan-Sakhalin-Transiberian and Transkorean-Transiberian. All 3 proposed as Europe-Asia transport corridors, and all 3 bypassing China and Kazakhstan. The shock and horror

sepheronx wrote:

ExBeobachter1987 wrote:Turkey does.

I dont think there is direct land connection or ships couldnt pass through black sea. Bridge connection has to be established.  This new route or whatever if claimed to be true (lenta has been caught various times to be full of shit), then this is a far more expensive manouver which China will just piss off Russia and make it harder for themselves.

This may be an alternative route to work with the Russian route, as Russia is indeed sanctioned by Europe and may cause problems for China.

Turkey does have a land border with the EU members Bulgaria and Greece. The Black Sea can be bypassed.

If donald trumph gets the green light from US elites to Rule in the next elections
and become President of USA ending Bush and obamas eras for once. China then
will be doomed.. Because his policies he advertise that will retake the American jobs
lost to CHina back To USA. and that he will have good relations with RUssia.
and strike a deal to them..

and China will be doomed..

So if he wins ,probably Russia will have to take sides an pick a major ally between
US and CHina. So China cannot think for a second that it goes both ways.. and failing
to have a strong alliance with Russia now ,will heavily damage is long future economic relations with RUSSSiA.

trumph is also Pro ISrael.. and Putin have ok relations to Israel..
So is quite probably that Russia will have to create new alliance where CHINA and IRAN
are not present. will not be present. In change trumph will convince the elites who control USA
to stop the war against Russia and remove the missile shield from Europe and or include Russia in NATO.. and something like this will be in the interest of Russia.. after the major betrayal of all its allies in Syria that are not helping when Russia asked for help.

Vann7 wrote:

If donald trumph gets the green light from US elites to Rule in the next elections
and become President of USA ending Bush and obamas eras for once. China then
will be doomed.. Because his policies he advertise that will retake the American jobs
lost to CHina back To USA. and that he will have good relations with RUssia.
and strike a deal to them..  

and China will be doomed..  

So if he wins ,probably Russia will have to take sides an  pick a major ally between
US and CHina. So China cannot think for a second that it goes both ways.. and failing
to have a strong alliance with Russia now ,will heavily damage is long future economic relations  with RUSSSiA.

trumph is also Pro ISrael.. and Putin have ok relations to Israel..
So is quite probably that Russia will have to create new alliance where CHINA and IRAN
are not present. will not be present.  In change trumph will convince the elites who control USA
to stop the war against Russia and remove the missile shield from Europe and or include Russia in NATO.. and something like this will be in the interest of Russia.. after the major betrayal of all its allies in Syria that are not helping when Russia asked for help.

Trump won't/can't do shit, Jews run America and they say what goes on.

Floating ruble policy has given Russia powerful foreign policy tool:

http://www.rferl.mobi/a/russia-iran-iraq-quash-saudi-bid-cut-oil-output-opec/27406246.html?utm_source=dlvr.it&utm_medium=twitter

Quite different story from usual MSM bollocks, low oil prices have began to affect some key countries allied or quasi-allied to US , Azerbaijan FOREX reserves collapsed in a year from $14.9 bln to $6.2 bln; Bahrain runs two digit deficits, break even price for budget is $122 per barrel , gov. debt exploding, same as Saudi Arabia but given volatility and current intervention in Yemen and a new potential intervention in Bahrain in horizon , it will overstretch Saudi finances even more. Nearly all petrodollar economies are fighting in vain against devaluation and cutting welfare & subsidies.

More domestic problems less stomach for foreign policy adventures.

zg18 wrote:Floating ruble policy has given Russia powerful foreign policy tool:

http://www.rferl.mobi/a/russia-iran-iraq-quash-saudi-bid-cut-oil-output-opec/27406246.html?utm_source=dlvr.it&utm_medium=twitter

Quite different story from usual MSM bollocks, low oil prices have began to affect some key countries allied or quasi-allied to US , Azerbaijan FOREX reserves collapsed in a year from $14.9 bln to $6.2 bln; Bahrain runs two digit deficits, break even price for budget is $122 per barrel , gov. debt exploding, same as Saudi Arabia but given volatility and current intervention in Yemen and a new potential intervention in Bahrain in horizon , it will overstretch Saudi finances even more. Nearly all petrodollar economies are fighting in vain against devaluation and cutting welfare & subsidies.

More domestic problems less stomach for foreign policy adventures.

Looks like the Saudis have bitten off more than they could chew when they agreed to Kerry's proposal last year of boosting oil output to pressure Russia and Iran.

Now the shoe is on the other foot. Russia and Iran may have taken a hit, but the Saudis are positively squirming, and everyone can see that.

flamming_python wrote:Looks like the Saudis have bitten off more than they could chew when they agreed to Kerry's proposal last year of boosting oil output to pressure Russia and Iran.

Now the shoe is on the other foot. Russia and Iran may have taken a hit, but the Saudis are positively squirming, and everyone can see that.

I heard that, low oil price is the secret agreement between Russia, Saudi and Western oil oligarchs (Shell, BP...)

The goal of that is crushing Obama's "shale oil". Obama tried to use shale oil as a trump card to boost his own prestige. But that harm the position of traditional oil oligarchs, so they teamed up together and crush the shale companies.

And crushed Obama along with these.

higurashihougi wrote:I heard that, low oil price is the secret agreement between Russia, Saudi and Western oil oligarchs (Shell, BP...)

The goal of that is crushing Obama's "shale oil". Obama tried to use shale oil as a trump card to boost his own prestige. But that harm the position of traditional oil oligarchs, so they teamed up together and crush the shale companies.

And crushed Obama along with these.

Oil prices crashed soon after Kerry visited Saudis. Obama administration wanted to hurt Russia so badly they sacrificed "shale oil", it was the price Washington payed to Saudis to agree to the proposal.

But Russians were for years preparing for such scenario, ruble devaluation and debt deleveraging that put Russia on top of the game compared to other energy producers.

Iranians will add new oil on saturated markets, it will put lot of ME and GCC countries on breaking point. Saudis used to set price of oil, but now they need Russia & Iran on board, which means political leverage.

zg18 wrote:

higurashihougi wrote:I heard that, low oil price is the secret agreement between Russia, Saudi and Western oil oligarchs (Shell, BP...)

The goal of that is crushing Obama's "shale oil". Obama tried to use shale oil as a trump card to boost his own prestige. But that harm the position of traditional oil oligarchs, so they teamed up together and crush the shale companies.

And crushed Obama along with these.

Oil prices crashed soon after Kerry visited Saudis. Obama administration wanted to hurt Russia so badly they sacrificed "shale oil", it was the price Washington payed to Saudis to agree to the proposal.

But Russians were for years preparing for such scenario, ruble devaluation and debt deleveraging that put Russia on top of the game compared to other energy producers.

Iranians will add new oil on saturated markets, it will put lot of ME and GCC countries on breaking point. Saudis used to set price of oil, but now they need Russia & Iran on board, which means political leverage.

Correlation is not causation. There are firms that track Saudi oil exports (e.g. number of loaded tankers shipping out) and they did not
observe any large jump in Saudi oil production in late summer, early fall of 2014. The Saudis are still pumping about 10 million barrels per
day. They are not pumping 12 million barrels per day. So there is no flood of extra oil on the market as during the 1980s when the
Saudis did flood the market (their OPEC quota abuse was repeated by most of the other OPEC members).

The real reason for the oil price crash is global demand decline due to recession. We had the same pattern in 2008 when the oil
price crashed together with the financial meltdown. The difference this time around is that the recession is lasting much longer and
the MSM is pretending it is not there. Given that there is a feedback on consumer confidence and hence economic activity due to
negative reporting on the economy, this is clearly an attempt to boost the economy via psychological means. However, that can
only last for a short period since eventually people notice that they are getting poorer.

kvs wrote:Correlation is not causation.   There are firms that track Saudi oil exports (e.g. number of loaded tankers shipping out) and they did not
observe any large jump in Saudi oil production in late summer, early fall of 2014.   The Saudis are still pumping about 10 million barrels per
day.   They are not pumping 12 million barrels per day.   So there is no flood of extra oil on the market as during the 1980s when the
Saudis did flood the market (their OPEC quota abuse was repeated by most of the other OPEC members).  

The real reason for the oil price crash is global demand decline due to recession.   We had the same pattern in 2008 when the oil
price crashed together with the financial meltdown.   The difference this time around is that the recession is lasting much longer and
the MSM is pretending it is not there.   Given that there is a feedback on consumer confidence and hence economic activity due to
negative reporting on the economy, this is clearly an attempt to boost the economy via psychological means.   However, that can
only last for a short period since eventually people notice that they are getting poorer.

I agree with you, i`ve never said that Saudis are pumping additional oil, rather they didn`t want to cut production to keep the prices up.

Now, they want to do it but Russians and Iranians want to keep oil prices down to pressure Saudis.

With oil at 60$ Russia functions without a single problem. Price is below that ATM but it is perfectly manageable as we all can see.

But at 60$ Saudi Arabia goes down in flames. I have a feeling that Russia and Iran will make sure that price stays at 60$ or lower for quite some time...

higurashihougi wrote:

flamming_python wrote:Looks like the Saudis have bitten off more than they could chew when they agreed to Kerry's proposal last year of boosting oil output to pressure Russia and Iran.

Now the shoe is on the other foot. Russia and Iran may have taken a hit, but the Saudis are positively squirming, and everyone can see that.

I heard that, low oil price is the secret agreement between Russia, Saudi and Western oil oligarchs (Shell, BP...)

The goal of that is crushing Obama's "shale oil". Obama tried to use shale oil as a trump card to boost his own prestige. But that harm the position of traditional oil oligarchs, so they teamed up together and crush the shale companies.

And crushed Obama along with these.

This does not make sense to me because overall Russia and Saudi Arabia benefit from high oil prices while the US benefits from low oil prices because their economy is a major consumer of oil. Shale oil is just one small part of the US economy while Russia and Saudi Arabia rely on oil much more.

Karl Haushofer wrote:This does not make sense to me because overall Russia and Saudi Arabia benefit from high oil prices while the US benefits from low oil prices because their economy is a major consumer of oil. Shale oil is just one small part of the US economy while Russia and Saudi Arabia rely on oil much more.

That is a common misconception, shale was a rare industry which boomed in US, adding quality jobs, not McDonalds hamburger flip-flop jobs. All savings from cheaper gasoline Americans spend on more gasoline not buying stuff. Cheaper oil doesn`t add more dollars to the economy, it doesn`t create more jobs.

zg18 wrote:

Karl Haushofer wrote:This does not make sense to me because overall Russia and Saudi Arabia benefit from high oil prices while the US benefits from low oil prices because their economy is a major consumer of oil. Shale oil is just one small part of the US economy while Russia and Saudi Arabia rely on oil much more.

That is a common misconception, shale was a rare industry which boomed in US, adding quality jobs, not McDonalds hamburger flip-flop jobs. All savings from cheaper gasoline Americans spend on more gasoline  not buying stuff. Cheaper oil doesn`t add more dollars to the economy, it doesn`t create more jobs.

Well, cheap oil also makes cost of transport cheaper, and therefore it also makes services and goods more affordable for the consumers in the US.

Karl Haushofer wrote:Well, cheap oil also makes cost of transport cheaper, and therefore it also makes services and goods more affordable for the consumers in the US.

That`s the only benefit of cheap oil.