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Thread: Energy Transit routes and conflict

  1. #16
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    Quote Originally Posted by snapper View Post
    Might want to look at Caspian gas supply increases to Europe during the late 1990s upto 2008 in relation to the Muscovite Georgian war or why the Nagorno Karabakh/Artsak dispute remains 'frozen' when Armenia would be a better and easier route. Also look into the ongoing Belarusian Muscovite gas price dispute, North Stream (1 and the proposed 2), Polish and Lithuanian LNG terminals, recent Ukrainian - Romanian agreements, the 2013 Muscovite Ukrainian 'trade war' and the gas contracts following. Gas blackmail is a form of Muscovite hybrid war as is conventional war for control of the pipelines.
    Well there must be a way to break this cycle somehow.

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    Quote Originally Posted by Versus View Post
    Well there must be a way to break this cycle somehow.

    Certainly there are several ways. One is 'renewable energy' - solar, wind etc and long term environmentally this may be the wisest option (if you believe the global warming stuff) but it remains a long term objective and is not possible overnight. Shorter term LNG supply via the Black Sea (or the Baltic) relieves some stress on supply as does the exploitation of shale gas reserves in Poland and Ukraine. There is also the issue of a 'single European energy market' which has not yet been achieved. Explaining this may sound somewhat 'partisan' on my side but it should be common knowledge that Moscow uses gas blackmail as one of it's weapons. The point is that Gazprom seek to make what you might call 'binding contracts' which can be used beneficially for those who has done deals with or detrimentally for those who it feels may pose a problem. You may recall Yanukovych's 'deal' for Ukrainian gas in December 2013 at $268 per 1,000 cubic metres. The next year that agreement was unilaterally torn up on the Muscovite side and Uktransnaftgaz was required to pay $485.50 per 1,000 cubic metres. Belarus has been in a similar dispute since last year and the signs look ominous there with Zapad 17 coming up in 4 days.

    However last year Ukraine imported NO gas from Muscovy because in a free market you can buy from anyone at the lowest price; if the Slovaks get gas from Muscovy at $250 per 1,000 cubic metres let them buy more and Ukraine can buy from them cheaper than from their supplier. The Muscovite's 'binding contract' idea that goes something like "I am selling you this but you cannot sell it to anyone else" - as if they still had a residual right of veto on onward sale in the commodity they have allegedly sold their right to - does not apply in any normal law. So the freedom of the contract envisaged under a single European energy market would potentially increase competition and reduce prices for all.

  3. #18
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    if the Slovaks get gas from Muscovy at $250 per 1,000 cubic metres let them buy more and Ukraine can buy from them cheaper than from their supplier.
    What!...Really!! you think ???? Sounds like somebody is subsidising it if they are...

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    Quote Originally Posted by Toby View Post
    What!...Really!! you think ???? Sounds like somebody is subsidising it if they are...
    In a way you are right - ish; what price one is required to pay is dependent not on the market price but used as a form of political blackmail so that one does as Moscow wishes. The most obvious of the carrot and stick deals was the December 2013 'deal' with Yanukovych for the price of $268 per 1,000 cubic metres which came after he had rejected the EU free trade deal at Vilnius the month before; additionally Moscow offered to buy $10bn worth of Ukrainian bonds; they only ended buying $3bn and all of it vanished in Yanukovych's pocket; a kind of personal 'fee' for Yanukovych in other words. By March that deal was regarded (unilaterally by them) as having been broken. Why? Had Ukraine invaded Muscovy? On the contrary of course but the new Government was not behaving as wished so it turned out the Ukrainian energy buyer (Naftogaz), which three months before was sweet, owed $10bn in past debts for gas supply, no gas would be supplied without pre-payment, the price nearly doubled and of course forget the bond buying sweetner.

    If you look at the Paks ll deal for the upgrading of the Hungarian nuclear power station an almost identical 'loan' was involved the subject of which is a 'state secret' in Hungary. Of course nor all the Huns stupid or fooled; Zoltan Illes (from Orban's own party) a former Environment Minister said a few years ago; "This is a financial transaction, and for the Russians this is buying influence."

    The current problems in Belarus also stem in large part from Moscow reducing it's subsidisation of their gas last year, presumably because Moscow is running out of money. Lukashenka did not take this well. He and Putin never 'got on' personally and for him the Muscovite illegal actions in Ukraine were a clear warning; if Ukraine why not Belarus and he intends to keep what he regards as 'his fiefdom for life'; almost like a Medieval Baron. Thus he did not recognise the occupation of Crimea, came to Kyiv and offered whatever Ukraine wanted, refused Moscow's request for an air base, and then got himself international recognition by playing the intermediary at the Minsk agreements. Then as he was in the spotlight he released some political prisoners to great applause and EU sanctions were eased; you have to admire his game in some ways. At the same time came the gas price dispute in late summer last year. Negotiations were held but nothing gave so Lukashenka started paying what he considered a 'fair price' while Moscow was demanding their price. His next move was to ease the Belarusian visa requirement for 18 countries including the Baltics, Poland and Ukraine; tourists welcome as an economic boost ostensibly. The problem with this is since the Muscovite sanctions were imposed on various EU goods (Polish apples, French cheese etc) many of these goods had naturally found their way to Belarus where they were simply repackaged and stamped "Produce of Belarus" then sold on into Muscovy at a premium; smuggling being a long standing, professional and very lucrative expertise in this part of the world which the Belarusian state (ie Lukashenka) has long turned a blind eye to while seeking some of the profits. Of course Moscow knew all this and the visa business was regarded (rightly perhaps) as a further exploitation of the smuggling lines; the response was to set up border checks on the Belarus/Muscovite border. Oh dear! You see they are supposed to be working toward a union state; one people and all that and border checks kind of make a mockery of that when Poles and Ukrainians can walk into Belarus willy nilly (though officially only for two weeks but hey who knows you are there?). Who's side is who on? Apart from other things Lukashenka ran Belarusian exercises along his Eastern Frontier at the end of last year and this January (as is normal) went on TV for a nine hour rant about the everything and nothing but regarding Muscovy along the lines of "I have not betrayed them, why are they betraying our agreement?" specifically regarding the oil price dispute. Earlier this year Belarus through Polish intermediaries placed an order for Iranian oil to be imported via Poland (http://belarusfeed.com/belarus-buys-first-iran-oil/). Moscow must hate the irony! Then came the 'parasite tax' - enacted last year and due to come into force this January (I think). This is a 'tax' on anyone who does not work (and therefore pay tax) for 183 days per year; in other words a tax on unemployment because you 'owe' tax and the fine would be $245 to make up this shortfall. Well protests started fairly unsurprisingly; it does seem to be a little like getting blood from a stone initially but could perhaps be interpreted as a smugglers tax; either way not popular at all;


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    At the same time they did something extraordinarily stupid by starting to build on some war grave site which provoked similar protests; the dead were murdered by the Soviets. One has to wonder if this not calculated. Last year Lukashenka gave his first ever speech in the native language... now it seems it is his language of choice. You can imagine where he might have been telephoning; it was not east. Well the building program were suspended having stirred up the patriotic fervour and the 'parasite tax' (which some 460,000 Belarusians might be required to pay) was suspended for this year (only around 10% having payed). Moscow has obviously been urging a 'crack down' on the protestors and it seems a partial crack down is now under way (https://www.amnesty.org/en/latest/ne...eful-protests/) but naturally NOT against the smugglers. Meanwhile the gas dispute, which started the whole chain of events, continues, as do the protests (which are now threatening to turn into an anti Lukashenka regime, Maidan like reform like movement) and Zapad 17 is about to start (see https://osteuropastudien.wordpress.c...7-has-started/). This is very dangerous. I will not go into the strategics of why here.

    I would finally point out one further matter on the current gas wars agenda with regard to North Stream 2 and a little of the history of this for the sake of understanding. The first Ukrainian Muscovite gas dispute actually happened in back in the 1990s - there was always argument - over price and transit fees and rumbled on and off under reaching a near flat out war in Jan 2009 when Kyiv (stupidly) 'pinched' some of the gas supposed to be transited onwards. Result; North Stream 1 which Radek Sikorski (then the Polish Defence Minister) compared to another Molotov Ribbentrop Pact. I remember mentioning on this forum at the time and our German friend kato telling me this was Polish paranoia. The point is the transit fees (payed by Gazprom not the purchaser) are quite significant; North Stream 1 cost Ukraine and North Stream 2 could potentially cost Ukraine upto $1bn in transit fees per year. The Slovaks, Belarusians, Poles etc will also lose out and without a single European energy market are at increased risk to more 'gas blackmail' from Moscow, notwithstanding the new LNG terminals in Poland and Lithuania. It is one thing for the Germans to say "we are all Europeans now" when their actions rob other Europeans of income. So you see how this gas weapon is used? Of course I do not blame the average Kraut, though some of them are deeply suspect in my view a la Shroeder (who surely should be charged). I would welcome a true German response to European unity, which may be required sooner rather than later if they do not wish see the Muscovites back on the Oder Neisse line. The point of it all - and I started off involved in trade diplomacy dealing specifically with gas - has been firstly for Moscow to acquire as far as possible an energy monopoly over Central and Eastern Europe (including the Western Balkans - South Stream etc) and secondly to do a separate deal with Germans. That's what Georgia was about; ended Nabucco, apart from the murders. That's what Syria is about. The Turks shot down one of their planes and their Ambassador was shot but all is forgiven and the Turkish nutcase encouraged, feasted in Moscow and their Syrian incursion ignored. The recent reports of Muscovite spetsnaz in Libya should come as no surprise; the Libyan General Haftar, armed by Muscovy has again acquired possession of the oil refineries; the Italian - Libyan oil deals are now contingent on Muscovite say so; good behaviour required or refugees sent. Again the opportunity was wasted; the Italians offered to go into Libya a few years back; Obama wouldn't give the US naval committment; shame now we have worse in the White House and the Italians don't want to get into a tangle with the Muscovites. If you leave a vacuum do not be surprised if your enemies fill it.

    In the end the 'West' needs to understand that we are at war on every front; information, oil, gas, propaganda, elections, intelligence, technology, cyber, corruption; everything. Go watch Putin's speech at the Munich Security Conference in 2007 and look what has happened since. Of course we must set our house in order, rebuild and re - brand the 'social contract' and the economic model with more hope for the individual and less favour to the international conglomerates, more transparency and accountability and above more unity of purpose and belief that freedom under the law is rights for all, be they ne'er so low. Above all though we must fight back against a new Medieval-ism of belief as opposed to facts shared by both Moscow and the new Islamists. There is an intellectual war as well - a concept war as it were - and if that can be won we shall be a long way toward a new enlightenment. I have done many things which doubtless some would consider immoral or even evil in the name of the greater good but I have never wished for dominion as the truly evil do.
    Last edited by snapper; 16 Mar 17, at 14:30.

  5. #20
    Senior Contributor Toby's Avatar
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    Quote Originally Posted by snapper View Post
    In a way you are right - ish; what price one is required to pay is dependent not on the market price but used as a form of political blackmail so that one does as Moscow wishes. The most obvious of the carrot and stick deals was the December 2013 'deal' with Yanukovych for the price of $268 per 1,000 cubic metres which came after he had rejected the EU free trade deal at Vilnius the month before; additionally Moscow offered to buy $10bn worth of Ukrainian bonds; they only ended buying $3bn and all of it vanished in Yanukovych's pocket; a kind of personal 'fee' for Yanukovych in other words. By March that deal was regarded (unilaterally by them) as having been broken. Why? Had Ukraine invaded Muscovy? On the contrary of course but the new Government was not behaving as wished so it turned out the Ukrainian energy buyer (Naftogaz), which three months before was sweet, owed $10bn in past debts for gas supply, no gas would be supplied without pre-payment, the price nearly doubled and of course forget the bond buying sweetner.

    If you look at the Paks ll deal for the upgrading of the Hungarian nuclear power station an almost identical 'loan' was involved the subject of which is a 'state secret' in Hungary. Of course nor all the Huns stupid or fooled; Zoltan Illes (from Orban's own party) a former Environment Minister said a few years ago; "This is a financial transaction, and for the Russians this is buying influence."

    The current problems in Belarus also stem in large part from Moscow reducing it's subsidisation of their gas last year, presumably because Moscow is running out of money. Lukashenka did not take this well. He and Putin never 'got on' personally and for him the Muscovite illegal actions in Ukraine were a clear warning; if Ukraine why not Belarus and he intends to keep what he regards as 'his fiefdom for life'; almost like a Medieval Baron. Thus he did not recognise the occupation of Crimea, came to Kyiv and offered whatever Ukraine wanted, refused Moscow's request for an air base, and then got himself international recognition by playing the intermediary at the Minsk agreements. Then as he was in the spotlight he released some political prisoners to great applause and EU sanctions were eased; you have to admire his game in some ways. At the same time came the gas price dispute in late summer last year. Negotiations were held but nothing gave so Lukashenka started paying what he considered a 'fair price' while Moscow was demanding their price. His next move was to ease the Belarusian visa requirement for 18 countries including the Baltics, Poland and Ukraine; tourists welcome as an economic boost ostensibly. The problem with this is since the Muscovite sanctions were imposed on various EU goods (Polish apples, French cheese etc) many of these goods had naturally found their way to Belarus where they were simply repackaged and stamped "Produce of Belarus" then sold on into Muscovy at a premium; smuggling being a long standing, professional and very lucrative expertise in this part of the world which the Belarusian state (ie Lukashenka) has long turned a blind eye to while seeking some of the profits. Of course Moscow knew all this and the visa business was regarded (rightly perhaps) as a further exploitation of the smuggling lines; the response was to set up border checks on the Belarus/Muscovite border. Oh dear! You see they are supposed to be working toward a union state; one people and all that and border checks kind of make a mockery of that when Poles and Ukrainians can walk into Belarus willy nilly (though officially only for two weeks but hey who knows you are there?). Who's side is who on? Apart from other things Lukashenka ran Belarusian exercises along his Eastern Frontier at the end of last year and this January (as is normal) went on TV for a nine hour rant about the everything and nothing but regarding Muscovy along the lines of "I have not betrayed them, why are they betraying our agreement?" specifically regarding the oil price dispute. Earlier this year Belarus through Polish intermediaries placed an order for Iranian oil to be imported via Poland (http://belarusfeed.com/belarus-buys-first-iran-oil/). Moscow must hate the irony! Then came the 'parasite tax' - enacted last year and due to come into force this January (I think). This is a 'tax' on anyone who does not work (and therefore pay tax) for 183 days per year; in other words a tax on unemployment because you 'owe' tax and the fine would be $245 to make up this shortfall. Well protests started fairly unsurprisingly; it does seem to be a little like getting blood from a stone initially but could perhaps be interpreted as a smugglers tax; either way not popular at all;


    Name:  people-protest-against-new-taxes-and-increased-tariffs-for.jpg
Views: 270
Size:  53.7 KB

    At the same time they did something extraordinarily stupid by starting to build on some war grave site which provoked similar protests; the dead were murdered by the Soviets. One has to wonder if this not calculated. Last year Lukashenka gave his first ever speech in the native language... now it seems it is his language of choice. You can imagine where he might have been telephoning; it was not east. Well the building program were suspended having stirred up the patriotic fervour and the 'parasite tax' (which some 460,000 Belarusians might be required to pay) was suspended for this year (only around 10% having payed). Moscow has obviously been urging a 'crack down' on the protestors and it seems a partial crack down is now under way (https://www.amnesty.org/en/latest/ne...eful-protests/) but naturally NOT against the smugglers. Meanwhile the gas dispute, which started the whole chain of events, continues, as do the protests (which are now threatening to turn into an anti Lukashenka regime, Maidan like reform like movement) and Zapad 17 is about to start (see https://osteuropastudien.wordpress.c...7-has-started/). This is very dangerous. I will not go into the strategics of why here.

    I would finally point out one further matter on the current gas wars agenda with regard to North Stream 2 and a little of the history of this for the sake of understanding. The first Ukrainian Muscovite gas dispute actually happened in back in the 1990s - there was always argument - over price and transit fees and rumbled on and off under reaching a near flat out war in Jan 2009 when Kyiv (stupidly) 'pinched' some of the gas supposed to be transited onwards. Result; North Stream 1 which Radek Sikorski (then the Polish Defence Minister) compared to another Molotov Ribbentrop Pact. I remember mentioning on this forum at the time and our German friend kato telling me this was Polish paranoia. The point is the transit fees (payed by Gazprom not the purchaser) are quite significant; North Stream 1 cost Ukraine and North Stream 2 could potentially cost Ukraine upto $1bn in transit fees per year. The Slovaks, Belarusians, Poles etc will also lose out and without a single European energy market are at increased risk to more 'gas blackmail' from Moscow, notwithstanding the new LNG terminals in Poland and Lithuania. It is one thing for the Germans to say "we are all Europeans now" when their actions rob other Europeans of income. So you see how this gas weapon is used? Of course I do not blame the average Kraut, though some of them are deeply suspect in my view a la Shroeder (who surely should be charged). I would welcome a true German response to European unity, which may be required sooner rather than later if they do not wish see the Muscovites back on the Oder Neisse line. The point of it all - and I started off involved in trade diplomacy dealing specifically with gas - has been firstly for Moscow to acquire as far as possible an energy monopoly over Central and Eastern Europe (including the Western Balkans - South Stream etc) and secondly to do a separate deal with Germans. That's what Georgia was about; ended Nabucco, apart from the murders. That's what Syria is about. The Turks shot down one of their planes and their Ambassador was shot but all is forgiven and the Turkish nutcase encouraged, feasted in Moscow and their Syrian incursion ignored. The recent reports of Muscovite spetsnaz in Libya should come as no surprise; the Libyan General Haftar, armed by Muscovy has again acquired possession of the oil refineries; the Italian - Libyan oil deals are now contingent on Muscovite say so; good behaviour required or refugees sent. Again the opportunity was wasted; the Italians offered to go into Libya a few years back; Obama wouldn't give the US naval committment; shame now we have worse in the White House and the Italians don't want to get into a tangle with the Muscovites. If you leave a vacuum do not be surprised if your enemies fill it.

    In the end the 'West' needs to understand that we are at war on every front; information, oil, gas, propaganda, elections, intelligence, technology, cyber, corruption; everything. Go watch Putin's speech at the Munich Security Conference in 2007 and look what has happened since. Of course we must set our house in order, rebuild and re - brand the 'social contract' and the economic model with more hope for the individual and less favour to the international conglomerates, more transparency and accountability and above more unity of purpose and belief that freedom under the law is rights for all, be they ne'er so low. Above all though we must fight back against a new Medieval-ism of belief as opposed to facts shared by both Moscow and the new Islamists. There is an intellectual war as well - a concept war as it were - and if that can be won we shall be a long way toward a new enlightenment. I have done many things which doubtless some would consider immoral or even evil in the name of the greater good but I have never wished for dominion as the truly evil do.
    Strikes me that Russian citizens would fair far better under the EU than under their current mafia. Far better than the UK for example. Oh don't worry we know we are at war on every front...Unfortunately we have British institutions like the BBC that try to be balanced and yet fail miserably and turn their backs on the very people that pay their wages....
    Anyway IF you are getting your gas cheaper from a 3rd party. Well in most common a garden books that is called fiddling!

  6. #21
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    Quote Originally Posted by Toby View Post
    Anyway IF you are getting your gas cheaper from a 3rd party. Well in most common a garden books that is called fiddling!
    I have tried to explain the real world but you wish to not to see it; when Muscovy asks prepayment at an inflated (for political reasons) price but sells to others for nearly half the price what would make sense to you? I understand you may not wish to believe it but why not check it up yourself? I have told you nothing that is secret; all is in the public domain. Don't believe it or chose to close your eyes? I know I have an 'interest' as it were but prove me wrong. You are what they call a "useful idiot" and generally in older days when they preached Marxism they were the first before the firing squads; "dangerous intellectuals" or some such. Plus ca change plus c'est la meme chose.

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    Quote Originally Posted by Toby View Post
    What!...Really!! you think ???? Sounds like somebody is subsidising it if they are...
    They go above $300, but you guys are/were in the lower pier.

    With the EU's pressure on Gazprom to let them resell...
    No such thing as a good tax - Churchill

    To make mistakes is human. To blame someone else for your mistake, is strategic.

  8. #23
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    Quote Originally Posted by snapper View Post
    I have tried to explain the real world but you wish to not to see it; when Muscovy asks prepayment at an inflated (for political reasons) price but sells to others for nearly half the price what would make sense to you? I understand you may not wish to believe it but why not check it up yourself? I have told you nothing that is secret; all is in the public domain. Don't believe it or chose to close your eyes? I know I have an 'interest' as it were but prove me wrong. You are what they call a "useful idiot" and generally in older days when they preached Marxism they were the first before the firing squads; "dangerous intellectuals" or some such. Plus ca change plus c'est la meme chose.
    You do tend to rewrite the bible when explaining, so I was helping you get to the point. Which is Useful, hardly an idiot!

  9. #24
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    Quote Originally Posted by Doktor View Post
    They go above $300, but you guys are/were in the lower pier.

    With the EU's pressure on Gazprom to let them resell...
    I get it.. ;-)

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    Quote Originally Posted by Toby View Post
    You do tend to rewrite the bible when explaining, so I was helping you get to the point. Which is Useful, hardly an idiot!
    What is happening in Belarus - partly as a result of this gas dispute - matters. There is a prima facie case regarding the Iranian or Qatari pipeline going via Syria and look what happened there. Fortunately that is not my business and I do not have time to follow it or I may feel I need to explain that! As far as I do understand it I would call it a sectarian and arab/Persian war with gas thrown in.

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    Quote Originally Posted by snapper View Post
    What is happening in Belarus - partly as a result of this gas dispute - matters. There is a prima facie case regarding the Iranian or Qatari pipeline going via Syria and look what happened there. Fortunately that is not my business and I do not have time to follow it or I may feel I need to explain that! As far as I do understand it I would call it a sectarian and arab/Persian war with gas thrown in.

  12. #27
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    Quote Originally Posted by snapper View Post
    I have tried to explain the real world but you wish to not to see it; when Muscovy asks prepayment at an inflated (for political reasons) price but sells to others for nearly half the price what would make sense to you? I understand you may not wish to believe it but why not check it up yourself? I have told you nothing that is secret; all is in the public domain. Don't believe it or chose to close your eyes? I know I have an 'interest' as it were but prove me wrong. You are what they call a "useful idiot" and generally in older days when they preached Marxism they were the first before the firing squads; "dangerous intellectuals" or some such. Plus ca change plus c'est la meme chose.
    In the political sense my idea of a 'useful idiot' would be John Douglas Wilson Carswell.

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    Quote Originally Posted by Toby View Post
    In the political sense my idea of a 'useful idiot' would be John Douglas Wilson Carswell.
    But not the former Great Leader of his Party right?

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    Quote Originally Posted by snapper View Post
    But not the former Great Leader of his Party right?
    I don't think he was a great leader. But after successive governments had basically sold UK democracy out to a bunch of bureaucrats. It wasn't exactly hard to convince people to vote for him. The political class got what they deserved, You reap what you sow basically!

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