Russia and economic war by the west

Sure. I expected deliveries to China to double or close to it this year as the new gas pumping stations come online.
But deliveries are still at a really low level. Belarus consumes more Russian piped gas than China currently.
Even once Power of Siberia is fully operational, China will consume about a third of the piped gas that Europe does.
And this is a different gas resource, so we can't really call it an alternative client, just an alternative income stream.

They will have to make Soyuz Vostok and/or the Altai pipeline to divert Yamal gas to Europe.
The delayed LNG projects at Yamal, like the Novatek Arctic LNG 2 project which is going to be delayed with sanctions would also help transition Yamal gas supplies to Asia if they manage to solve the import substitution issues with liquefaction equipment and get the thing to work.

bmpd
April 29th, 11:39 pm
As the Czech group OMNIPOL announced on April 27, 2022, the largest manufacturer of civil transport aircraft in the Czech Republic, Aircraft Industries (formerly LET Kunovice) is returning to Czech ownership after 14 years. On April 21, 2022, the Russian owner and the OMNIPOL group agreed to sell 100% of the shares of Aircraft Industries to the Czech company OMPO Holding (a subsidiary of OMNIPOL).

Of course they sold it because they likely got told that if you don't sell it to us we will simply nationalise it and you wont get a cent for it.

It's a repeate that continues to fail on grand scale. To the point Russians are returning to Russia. That is an achievement if I ever saw one of America's very poorly thought out and contradicting policies...

It is good to confirm they are still that stupid though... still drinking their own cool aide.

Even if Americans are able to get hold of Ukrainian scientists, engineers they will still benefit just like they benefited from the import of scientists, engineers from Nazi Germany aster the end of WW-II

This is true, but if they keep using their dollar as a weapon and just printing more money when they want it its value is going to tank which means all those imported experts are going to be suffering with the rest of the population because all production was exported and now they import everything and now they can't pay in monopoly money US dollars any more... what are they going to pay with?

Sure. I expected deliveries to China to double or close to it this year as the new gas pumping stations come online.
But deliveries are still at a really low level. Belarus consumes more Russian piped gas than China currently.

The issue would be that the capacity potential has increased to pump more gas to China but traditionally gas was expensive in the Asian market so many energy users went for cheap and dirty coal or other sources of energy and the sudden introduction of cheap gas will create interest in the market and over time users of coal and other sources of energy will switch to cheaper cleaner gas supplies.

With the new pipe going through Mongolia companies in Mongolia and China might realise gas is a safe and affordable alternative to other energy sources and switch to it.

Energy prices in Central and eastern Russia is also expensive compared to western Russia. I know there was plans to improve the natural gas pipelines throughout Russia. Would be ideal to use it as well for up north/northeast as those areas is most expensive. Natgas plants can be very ideal and inexpensive for russians.

It is an energy source that can be piped around the place with no risk of freezing like water, and in very cold places the need for gas powered energy generation is obvious because a natural byproduct is heat which is also important in such regions.

Nuclear power stations mounted on ships have the same advantages... except the NPPs are mobile.

sepheronx wrote:

Mobile NPP's was a temporary stopgap till they had proper working NG stations up and running.  Nuclear for a smaller community up north just doesnt make sense and instead NAT Gas plants generate reliable and cheap energy and can be easily upgraded or expanded to push even more out.

Places like Pevek can have LNG stations, in the best case. It is nonsensical to run pipeline for thousands of kilometers for a single village. Whole Chukotka has 50000 people and it is double the size of Germany.

Is it true that Russian gas pipelines and LNG stations still mostly depend on western machinery?

limb wrote:Is it true that Russian gas pipelines and LNG stations still mostly depend on western machinery?

The gas pipelines part is BS. The pipes used in Power of Siberia were made in Russia. The pumping machinery is also made in Russia. The US has also put sanctions on horizontal drilling equipment since 2014. Russia has since made its own drilling equipment from what I heard.

The LNG liquefaction facilities however they still use European and Japanese machinery from what I understand. The sanctions seem to have delayed entry into service of the Novatek Arctic 2 LNG project for example. Novatek has funded development of alternative equipment in Russia, but last I heard it did not have the performance they wanted, and they were suing the manufacturers. The government might have to straighten that out.

The sanctions might also delay some of the gas and oil processing facilities which were being built. Since those AFAIK also use European equipment.

But anyway, in the first case we are talking about giant refrigerators, and in the second case we are talking about membranes and gas separation towers and the like. It is not like it is something impossible for the Russian industry to build if they really want to.

With regards to the oil industry, the Europeans were blabbering how Russian oil industry would collapse. i.e. they thought the Russians couldn't refine diesel without catalysts they used to import from Europe to use in refineries in Russia. But, the thing is, Rosneft had already made and tested their own Russian made catalyst like two years ago. And Rosneft have more than enough production of catalyst to meet the needs of the Russian market. In the meantime, a lot of their refineries depend on Russian distillate exports to make diesel fuel, and without the distillates to dilute the oil European refining would be seriously impacted. Just think about what happened to Venezuela when the US stopped sending them distillates. From what I understand they will be hard pressed to replace those and are already importing refined diesel from Saudi Arabia.

Some LNG tankers are also being built in cooperation with South Korean shipyards, and there might be problems with that. But it is not like the Chinese can't build LNG tankers. And good luck to the South Koreans selling those tankers to someone else. Those are Arc7 icebreaking LNG tankers. They will be useless for anything else other than transporting LNG from the Russian Arctic.

lancelot wrote:

limb wrote:Is it true that Russian gas pipelines and LNG stations still mostly depend on western machinery?

The sanctions might also delay some of the gas and oil processing facilities which were being built. Since those AFAIK also use European equipment.

One bulit by Gazprom in Blagoveschensk  will be finished. Delay will be for one built by Novatek amd they already said that. 
I'm not sure what will happen to Gazprom's facility in Ust Luga. I think that a lot of tech is Russian, but not 100% sure.
Biggest problems will be LNG facilities imo.

Mobile NPP's was a temporary stopgap till they had proper working NG stations up and running. Nuclear for a smaller community up north just doesnt make sense and instead NAT Gas plants generate reliable and cheap energy and can be easily upgraded or expanded to push even more out.

Ship based NPPs are vastly too expensive to be stopgap measures... their advantages is that they can be used in temporary locations for prospector stations looking for resources that may find nothing and then move on... not something worth building a pipeline too unless there was already a pipeline going past that area.

A NPP being mobile has the advantage of being sailed where it is needed to boost local energy levels without needing lots of infrastructure to be built... for instance a coastal city that is using more power than it is getting could have one or more NPPs sail into harbour and connect to the electricty grid... it could also be used for desalination to provide significant volumes of fresh clean drinking water too... for small island countries or remote areas as well as large coastal cities that would be very valuable.

Here in New Zealand when we privatised electricity supply there were six main power cables going into Auckland, our largest city... not long afterwards there were two main power cables running that supplied the bare minimum needed to keep the lights on so if one failed the other could not cope on its own and there would be blackouts... being able to sail in a nuclear power station able to handle the needs of the whole city on its own would allow the remaining power line to be shut down for maintenance and repair... one at a time and then perhaps bring one or two other lines back on line for some redundancy and growth capacity.

Of course if they didn't cut costs all six would be operational and they could shut down one or two at a time for maintenance, but private companies wanted to cut costs and 6 lines was just too much overheads in terms of support costs.

Places like Pevek can have LNG stations, in the best case. It is nonsensical to run pipeline for thousands of kilometers for a single village.

It would only make sense linking distant regions together and having offshoot pipes at different places to feed local users... they could follow the rail lines and therefore provide power for stops along the route where small support towns could pop up if there were local resources worth extracting or junctions of branches for rail or road lines.

Later it could be modified to carry hydrogen for electric and hydrogen fuel cell technology if that takes off.

Is it true that Russian gas pipelines and LNG stations still mostly depend on western machinery?

The oil and gas technology was sanctioned in 2014 in the hopes of crippling Russia and it backfired... they can now use old military jet engines for pumping stations and extraction and exploration is done with Russian equipment too.

Some LNG tankers are also being built in cooperation with South Korean shipyards, and there might be problems with that

The new shipyards in the far east were designed and built by SK and their primary purpose is to build LNG tankers and other very large ships up to 350K tons to replace the ships they currently have built in SK, but also be able to make large military ships too.... it is likely where any CVN might be built for Russia.

The Russians have a special LNG ship for delivering gas to Kaliningrad... it is designed to connect to a port based gas pipe and take the gas onboard and liquify it as it takes it onboard in Leningrad. It then sails to Kaliningrad and connects to their gas pipe infrastructure and converts the LNG to gas and pipes it straight into their gas pipe network without port based conversion equipment.

It is why they are not panicked about getting gas to Kaliningrad via the existing or newly built pipelines... if they didn't have those special ships a branch of pipes would be added to NSII to feed gas to Kaliningrad too but it is not needed.

sepheronx wrote:

caveat emptor wrote:

sepheronx wrote:

Mobile NPP's was a temporary stopgap till they had proper working NG stations up and running.  Nuclear for a smaller community up north just doesnt make sense and instead NAT Gas plants generate reliable and cheap energy and can be easily upgraded or expanded to push even more out.

Places like Pevek can have LNG stations, in the best case. It is nonsensical to run pipeline for thousands of kilometers for a single village. Whole Chukotka has 50000 people and it is double the size of Germany.

Depends what is cheaper in the long run.  With the development of BAM and the rest of what is happening, I would wager to say that the Russian government is willing to spend now, so it benefits in long run.

Now is the time to build while the economy is down - this gets people working, buying goods, development where is needed, etc.  But I agree, massive pipeline for a small population isn't necessary either.  But a NPP.... Maybe but the bigger heads decided to forgo that and shut down the old one.

It is interesting times and hopefully we will see soon what they decide.

BAM is few thousand kilometers to the south. Chukotka is so isolated that i doubt it will ever get a gas pipeline. What will get amd should get gas pipelines are Chita and Zabaikalskiy krai and parts of Krasnoyarsk and Kuzbas

Anyone know the justification for Russia have/had law forbidding the called «grey imports»?

I have never heard of any country doing it. In Brazil for instance this is not ever a subject,[1]
and products available as «grey imports» are cheaper than the official one 99% of the time.

[1] this is only about proving the legal source of the product (as to speak) and paying the import duties.

rigoletto wrote:Anyone know the justification for Russia have/had law forbidding the called «grey imports»?

I have never heard of any country doing it. In Brazil for instance this is not ever a subject,[1]
and products available as «grey imports» are cheaper than the official one 99% of the time.

[1] this is only about proving the legal source of the product (as to speak) and paying the import duties.

My theory is that this was a legacy of the comprador regime change that saw Yeltsin installed as chief stooge.
Lots of theoretical western capitalist "values" were installed that have been f*cking Russia up even after all the
medicine applied after 1999. Protecting western intellectual property was paramount in Russia. It makes sense
that the same grovelling would be applied to primary suppliers. The gray market undercuts their revenue.

As of now the last structural deformations introduced under Yeltsin are crumbling.

Eurasia & Multipolarity
Sooner or later, everything secret becomes clear.

Press Secretary of the head of state Dmitry Peskov said that the country is discussing the issue of pegging the ruble to gold and currency values. In turn, Security Council Secretary Nikolai Patrushev noted that experts are working on a project proposed by the scientific community to create a dual-loop monetary and financial system.

What this means: in the foreseeable future, the Russian ruble will become a full-fledged world-class monetary unit, that is, a convertible ruble, and for this the country is taking all the necessary steps and decisions.

As soon as this happens, all Russian export goods will not only be sold abroad for rubles, but their value for foreign companies will be determined within our country. I am sure that a complete “decoupling” from the dollar and the creation of our own national monetary contour are ahead of us. Gradually, to one degree or another, other countries will also catch up to this contour, because they will no longer be able to participate in trade with Russia without complying with our rules, and this is inevitable.

@mironovonline
Duma Deputy Sergey Mironov, party leader of A Just Russia

EU strategy not to rely on Russian energy will hurt it more on short term but on long term - Russia will suffer more.

And it will not stop at this, once EU gets rid of oil and gas Russian financial institutions will be kicked out of SWIFT etc...

On long run Russia will even more slow down with its economical growth and transition -and its overall record is already not so good compared to CEE and Baltics countries for example.

This mess in Ukraine already costs way too much.

mr_hd wrote:EU strategy not to rely on Russian energy will hurt it more on short term but on long term - Russia will suffer more.

The EU isn't forced to buy Russian energy now and they could cut themselves off from it today if they so choose, but they don't because every alternative is significantly more expensive and in the case of LNG, the global capacity of LNG carriers is less than what Europe gets from Russian piped gas annually. 

And it will not stop at this, once EU gets rid of oil and gas Russian financial institutions will be kicked out of SWIFT etc...

https://en.wikipedia.org/wiki/SPFS
https://en.wikipedia.org/wiki/Cross-Border_Interbank_Payment_System
https://economictimes.indiatimes.com/news/economy/foreign-trade/india-russia-china-explore-alternative-to-swift-payment-mechanism/articleshow/72048472.cms

On long run Russia will even more slow down with its economical growth and transition

Of course, because the colossal Asian market as well as the middle eastern, south american and african market doesn't exist.

and its overall record is already not so good compared to CEE and Baltics countries for example.

https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)
Let me know where Russia and the 1st Baltic Lapdog on that list is.

This mess in Ukraine already costs way too much.

I agree, its practically destroying the EU and hurting the US too.

LMFS wrote:Eurasia & Multipolarity
Sooner or later, everything secret becomes clear.

Press Secretary of the head of state Dmitry Peskov said that the country is discussing the issue of pegging the ruble to gold and currency values. In turn, Security Council Secretary Nikolai Patrushev noted that experts are working on a project proposed by the scientific community to create a dual-loop monetary and financial system.

What this means: in the foreseeable future, the Russian ruble will become a full-fledged world-class monetary unit, that is, a convertible ruble, and for this the country is taking all the necessary steps and decisions.

As soon as this happens, all Russian export goods will not only be sold abroad for rubles, but their value for foreign companies will be determined within our country. I am sure that a complete “decoupling” from the dollar and the creation of our own national monetary contour are ahead of us. Gradually, to one degree or another, other countries will also catch up to this contour, because they will no longer be able to participate in trade with Russia without complying with our rules, and this is inevitable.

@mironovonline
Duma Deputy Sergey Mironov, party leader of A Just Russia

A currency strenght comes out from ones country economic performance. if your economy is doing well, your currency will do well. No need to worry about its value comparing to others, or even more about takink measures to prop it up, or manipulate its value. A healthy market will do that for you. Seems that is not the road the government decided to take. All this measures only create more confusion on the economic agents. And that's a fact. I love gold, have loads of it on my own, but that is a road not worth to take right now, especially for a big economy as the Russian one.

And the speech of "the country is taking all the necessary steps and decisions" is, for the lack of better words, unthusiastic already.

Sergey Glazyev: For those who still don’t understand

Source: https://glazev.ru/articles/10-vlast-i-obshhestvo/101493-narod-plokho-ponimaet-chto-proiskhodit

Machine Translation and then checked and finessed by the Saker Blog Translators

I will try to briefly explain and justify the necessary measures to achieve Victory

A special military operation (SVO) revealed a plan prepared in advance by the US power and financial elite to seize power in Russia. It includes the following components and stages.

1. Wear out the Russian armed forces in a war with well-trained and directly controlled by the Pentagon fighters of the Armed Forces of Ukraine, “stitched” by the Nazis with a vertical of officers appointed by the US and British special services. Turn the population of Ukraine into zombies infected with Russophobia. At the same time, incite the international community against Russia, making accusations of war crimes and genocide against its leadership. On this basis, confiscate Russia’s foreign currency assets and impose total sanctions against it, causing the maximum possible damage. This stage is actually completed.

2. Terrorize the Russian population with shelling of border settlements and military infrastructure, sabotage of transport, and hacker attacks. Hit the public consciousness with a flood of negative fake news and anti-government propaganda through social networks. To impose, through their agents of influence in the financial and economic authorities, an economic policy that blocks the mobilization of resources, including: inflating interest rates, continuing the export of capital, encouraging currency and financial speculation, manipulating the ruble exchange rate, and inflating prices. Thus, the sanctions can be repeatedly aggravated and provoke a collapse in production and a decline in living standards. This stage is in full swing.

3. Provoking protest moods and destructive socio-political actions aimed at overthrowing the legitimate authorities against the background of falling living standards and losses in the course of their activities. The use of the entire arsenal of methods for organizing “color revolutions” financed by the Comprador oligarchy under the promise of unfreezing assets seized in the US-European jurisdiction. At the same time, we are preparing the organizational and ideological foundations for separatist actions in the regions. This stage is under active development.

This plan also provides for the following tasks::

consolidation of US control over the European Union and NATO countries;
use of the armed forces of Poland, Romania and the Baltic states, as well as mercenaries from the West, the Middle East and the Middle East in combat operations against Russia;
the destruction of the male population and the actual enslavement of women and children of Ukraine for the subsequent development of this territory in the interests of the power and financial elite of the United States, Britain and Israel.

The implementation of this plan, in fact, is aimed at destroying the Russian world, followed by the American “deep state” plans to destroy Iran and block China.

Due to the objective laws of global economic development, this plan is doomed to failure. The United States will not be able to win the global hybrid war it has unleashed to maintain its global hegemony. They are irrevocably losing it to China, which is rapidly strengthening as a result of anti-Russian sanctions.

Washington, London, and Brussels played their main trump cards in an effort to inflict maximum possible damage on Russia: a monopoly on the issue of world currencies, an image of an exemplary legal democratic state, and a belief in the “sacred” right of private property. Thus, they have put all independent countries in front of the need to find new global currency instruments, risk insurance mechanisms, restore the norms of international law and create their own economic security systems.

Anti-Russian sanctions did not strengthen, but, on the contrary, undermined the global dominance of the United States and the EU, which the rest of the world began to treat with distrust and apprehension. They dramatically accelerated the transition to a new world economic order and the shift of the center of the world economy to Southeast Asia. Russia needs to stand up to the United States and NATO in its confrontation, bringing IT to its logical conclusion, so as not to be torn between them and China, which is irrevocably becoming the leader of the world economy.

https://thesaker.is/sergey-glazyev-for-those-who-still-dont-understand/

I think the whole "democracy" vs "autocracy" drivel is just a smokescreen for a technology war

The way I see it the West had organised the world into convenient little boxes
(a modern form of colonialism )

Russia = gas station and commodities .... (in fact the entire southern hemisphere as well)
China and SE Asia = mass production of low margin manufactured products
ME = gas station
India = call centres and programmers ... and lots of farmers

G7 = high end high margin manufacturing .... top of the pile

what they are really attacking is Russia and China emerging from their "allocated" boxes ...
and moving into the G7's self-appointed turf
( in fact this all blew up when Xi made that speech in 2018? about the smart high tech future of China )

but it is being presented as "democracy" vs "autocracy"

G7 group are desperately trying to hold onto the high tech position
because there are 1 billion of them
and if the other 7 billion get into high tech then sheer number of brains working on stuff will eventually crush them -
they can see that clearly .... eg China

G7 are 50% of world GDP now .....
they are headed for 25% very rapidly if they can't stop the developing world .... developing

globalisation was invented for the benefit of the G7 - is another way of putting it

the "rules based order" .... rules made by the G7 .... for the benefit of the G7

anyway that's the way it looks to me - just my view

sepheronx wrote:That isn't how things work. If it was as simple, Europe would have switched off Russian energy long ago. Instead they will now face hardship due to high energy costs and low productivity within European industries to which Asia will leave them behind. Most of Europe's advances and achievements are much the same as the North Americans- through pillaging resources and wealth from others to themselves. Like Rome, when that cannot be done anymore, they will fall behind and slowly collapse to obscurity.

Energy and resources do not come out of thin air. He who has cheapest energy, wins. And in this case, both China and Russia has the cheapest resources thus the cheapest production capabilities.

This is why everyone else is eager to eat up Russian assets that euros leave behind. All the while, the Europeans will grow dissatisfied that their Prada products, their Volkswagen, their French wines and campaigns, their general products are just not competitive nor needed. I mean, it was in the end brand naming while their products were barely made in Europe as is.

Russia has all it needs to grow itself regardless how the market trend of the world follows.  Now more so than ever.

Well there are few wrong assumptions - first EU can not in any case get rid of Russian energy import quickly. Simply it is impossible to switch off on short notice something like that and disconnect trade and infrastructure links that are build over period of 70 years.

For example Germany has gas contract that stipulates that it has to pay certain amount of Russian gas till 2030 even if country will not consume it. Of course that contract was signed in different times and was ok for both sides since assured stability of supply and production with relatively competitive and profitable prices. But right now no one can guarantee that those contracts can be fulfilled since relationship became too much toxic - no courts or legal institutions can repair that.

Second EU is not united so much, each country actually has its own national energy policies, that is of course weakness that is now fully exposed. United EU as single buyer on international market is totally different animal even compared to Germany for example. We see this already in LNG market where EU is right now the hottest and most lucrative market, it is so lucrative that it pushed away Asia which was unimaginable thing just few months ago.

Third - no serious country or entity like EU can afford to be energy depended and be serious power. That is the reason why China will be very careful and will not allow that Russian energy import becomes only dominant one and make China dependent - even if Russian energy right now has super attractive below market price. For the EU and long term strategy diversification is the goal - that is why it will build more LNG terminals even if that is more expensive compared to pipelines, but once infrastructure is built (additional terminals and interconnectors) it is much more easy to change supplier in case of a need - it makes long term perfect sense.

Fourth - energy is serious leverage that Russia has over EU. Without that situation totally changes for worse for Russia. Without energy dependency nothing stops EU to block all Russian financial institutions and banks from international finance system. Yes it will not break Russia but it will make sure doing international business with Russia much more difficult and expensive. And if that will not be enough EU and US will go after big third party customers - for example Indian and Chinese state energy companies, private business from both those countries is already careful about exposure to Russian market. All those measures will make Russia development much more difficult and slower. Russia is basically developing too slow already for last 3-4 years despite huge income from resource and agro products exports.

I personally love Russia and I think it is great country with huge potential. Russians are very smart people, I work in big company and we do have quite big branch in Russia, our colleagues there are hard working and very skilled. Of course I do not wish that country ends bad and that ordinary people have economical issues - that is the reason I think Russian leadership lost its compass and is not going to make Russia stronger on long run - actually quite the opposite is happening. I would love that I am wrong, time will tell.

The PPP rankings are still misleading. Consumer-centric price normalization does not reflect non-consumer parts of the GDP
and the structure of the economy. The G7 economies are mostly fluff. They offshored their industry and live off trickle down.
The US is not the largest economy as purported in the wiki link. China is clearly bigger in PPP terms and most importantly in
physical economy terms. Russia is not sixth place.

The GDP roughly scales with the size of the population. For some reason people have a hard time wrapping their heads around this.
So large population countries like India and China will be bigger in economic terms than Russia simply because of the size of the population.
But that is not a metric of the strength and importance of the Russian economy. The important thing is technological capacity and
the ability to render that technology into economically relevant reality. So "banana republic" Russia can stand on its own two feet with
the most autonomous and technologically diversified economy on the planet. It can also slug Uncle Scumbag in the face and send him flying.
Bigger economies such as India and supposedly bigger Germany can't.

The US is supposed to be autonomous and most technologically developed and diversified. But that is not true today. They are import
dependent. Their technological base is atrophied as shown by Westinghouse's failure in nuclear power plant development. It is not easy
in a laissez-faire capitalist utopia like the USA to reboot defunct production activity because all of the skilled workers are long gone.
They basically have to start from scratch. It is not clear that they can start from scratch because their education system has degenerated
to a critical extent. The US may well have reached a tipping point where it is not able to sustain its development level. Apple and
Microsoft are not enough and the current woke spasm is trumpeting the end times. The US cannot float on tranny affirmative action and
CRT where math is "racist". This depravity is not a boutique side show, it is now the core essence of the US.

mr_hd wrote:
I personally love Russia and I think it is great country with huge potential. Russians are very smart people, I work in big company and we do have quite big branch in Russia, our colleagues there are hard working and very skilled. Of course I do not wish that country ends bad and that ordinary people have economical issues - that is the reason I think Russian leadership lost its compass and is not going to make Russia stronger on long run - actually quite the opposite is happening. I would love that I am wrong, time will tell.

People are people the world over and need to be judged individually. However our leadership in the West (political / business and that line is blurry) are committed to their New World Order in which they are in charge. This requires the need for threatening up and comers to be isolated and contained. A clash was inevitable, Ukraine and the Donbas was the point in which Russia was to be forced backwards and weakened. The Russian leadership decided that neither appeasement or backing down were acceptable and it was time a line was drawn.