Skip to comments.Beyond oil and reserves, Russia running on empty
Posted on 07/31/2014 10:06:50 PM PDT by elhombrelibre
MOSCOW (Reuters) - For all the sanctions Western leaders can throw at Russia, the biggest threat to President Vladimir Putin's ability to back separatists in east Ukraine is something beyond his or their control: the price of oil.
With Russia's $2 trillion economy heavily dependent on crude exports, oil prices are always closely monitored by the Kremlin, but the government is particularly wary now as tensions with the West mount and sanctions ratchet up.
Such conflicts often push up crude prices, but as long as oil, which accounts for 40 percent of state revenues, remains above the average $104 per barrel written into the 2014 budget, Moscow has little immediate need to worry.
(Excerpt) Read more at news.yahoo.com ...
""If the oil price goes down to $75 and stays there for a few years, Russia will have regime change," said a prominent Russian economist who asked not to be named."
He asked not to be named because speaking of a government not led by Putin is dangerous.
Accelerated Keystone would certainly get Vlad’s attention.
Will Jughead do anything in the Free World’s interest?
Allowing Putin to game the system so he can retain power was supposed to workout well for Russia?
Just like in governments led by Clintons or Obamas?
Apart from the vague and unsupported assertion, "Asian banks are unlikely to be able to fill the gap" it is not clear why the Russians cannot look to China with whom they recently signed a big energy deal, for the funds needed to expand energy production in the East for delivery to energy hungry China.
Although the sanctions purport to close access by Russia to American banks to finance expended energy production, if the money comes from China America will be indirectly financing the expansion but with our money laundered through China. Every year we have stupendous trade imbalances in stupendous debts run up to China which that country uses to buy up commodities around the globe and, not incidentally, to support regimes openly hostile to America.
Are these sanctions pushing the Russians and the Chinese together? Has it not been in the strategic interest of the United States since Henry Kissinger to drive a wedge between Russia and China?
If we had a president who thought about these things or who even cared about these things we might forge a policy over Ukraine which is not self defeating. A president who is not anti-American might find a way to think his way through these things as did the Nixon/Kissinger team which exploited the split between Russia and China.
Russia and Putin play chess while the West plays checkers.
Anyone else notice that the Middle East is going BOOM?! Gee, wonder what that will do to the price of oil? And that also tells you who is behind it all.
More recent news from this year: Russia needs $101.70 a barrel to break even.
Oil Price Leverage Over Russia in Ukraine Crisis
By Roman Kilisek on April 17, 2014 at 12:10 PM
They left out rocket engine and space taxi revenue.
There is some thought that Putin is going on his adventures to get the people’s minds off their domestic misery. How true this might be, I couldn’t say, but apparently Russia’s economy is even worse than ours, despite Obama’s sabotage.
One of the reasons that could be given as a rationalization for Zero and company’s lifting of Iranian sanctions is that it puts pressure on oil prices, thus leveraging against Russia. Problem with that rationalization is, Zero also hurts our ally in the Middle East (Israel) and our expediencies in the Middle East (the Gulf states) while benefiting our enemies there (Iran, Turkey, Syria) — AND Zero has systematically attacked US energy production, including so-called green energy (those companies were merely fronts for money laundering).
This is why approving the Keystone pipeline and unleashing US energy potential is the best way to deal with Russia and the mid east. It mention of both of those events will start the decline of world energy prices and drive socialist countries into bankruptcy.
And the price yesterday was under $100.00 per barrel.
In terms of energy security, don’t forget fracking and allowing gas export.
I bet even eastern Europe is going to get in on the fracking game. Poland, for example, both is desperate to reduce it (and the rest of Europe)’s dependency on Russian gas, and happens to have massive shale gas reserves, some of the biggest in Europe.
Now that European countries are going to be directly sanctioned and to a large extent self-sanction (fines for violating sanctions are so massive that most companies don’t want to do anything that might have even a remote possibility of getting them hit), all of that money and equipment that would have otherwise gone to Russia is going to need new markets. A bet a large chunk will go to shale oil and gas.
Bush played checkers. Obama plays Go Fish.
These analysts aren’t running the full game simulation. The flip side is that Europe has no compelling alternative to Russian natural gas this Winter if Putin embargoes them by shutting the pipelines off.
Ditto for Russia ceasing to sell its 7 million barrels of oil per day.
Oh golly, Moscow’s budget won’t balance...gee, they can talk to DC about that one.
I’m with you on that one.
Everything our energy sector does to free the US from buying foreign oil makes the US richer and many of our enemies poorer.
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