Just heard on the news that in case of sanctions that the EU can get ready for retaliation by way of very high gas prices.

Sounds like you’re saying let them eat cake. A few hundred euros for someone who may already be at the limit can be bankruptcy. 1800 for someone with some reserves can also mean bankruptcy.

I meant that those preferential long term contracts that some European leaders brag about in their native countries, come with strings attached.

Russia has gas (and other resources), fair enough, but it shouldn't be more than a commercial partner. That alone doesn't give anyone the right to mingle in other countries' political affairs. Old EU (and some of the new EU too) had treated Russia as if they owe her more than that.

Yeah, but...a bit of context, wholesale prices right now are lower than around end last year. There was no Ukraine crisis then, it was driven by high demand. A scenario in which Gazprom stops supplying Europe is certainly possible, but very unlikely, they would be losing billions and Russia doesn't have many sources of income apart from oil and gas right now. Moreover, even if prices remain so high and possibly even higher next winter, Europe has tools to offset this for the end consumer. The Russian propaganda that somehow people will be cold and hungry in Europe is simply this: propaganda.

This is precisely where you and Putin disagree He was clear in his speech that not only is this his right, it is his obligation to fix a mistake from the past . The difference is that he has a few hundred thousands soldiers to back his challenge.

It just seems very shortsighted to say that people who will be heavily impacted will think....well I'm homeless, but it could be worse, I could be in Ukraine.

It's also ignoring the possible inflationary pressure as energy prices are want to do

Inflation has been creeping up in Europe since last year driven by economies picking up post covid combined with shortage of raw material and logistical challenges. In that context, we're now at around 5% in Europe, how much do you think does Russian gas contribute to that 5%?

So inflation excl. energy was 2.6% in Jan22 vs 5.1% including.

It is quite clear that energy prices are the main inflation driver. What is less clear is how much of it is due to the Ukraine crisis and related Russian behaviour of selling less gas. It is correct that energy prices would also be high without this, but how high? I recently saw an analysis that concluded that gas prices should be around 50 EUR/MWh based on pure fundamentals. There are close to 80 EUR/MWh now.

OK, „the US“ doesn’t gain from the high prices in Europe. The corresponding companies are gaining, including the US companies.

But higher prices are only part of the picture. At the moment the US is the world leading exporter of LNG. The ability to bring the replacement gas to Europe would be a huge political win for the US. Russia is being pushed out of the European gas market. The US was in recent talks with Japan and Qatar for their LNG to be increased for Europe. Also NS2 was announced indefinitely shut the moment Putin recognized the LDNR, even before any other sanctions were decided.

I agree. If Russia loses market share in Europe because Europe wants to diversify - that is great. Europe - whoever that is exactly - just needs to ensure that we have firm supplies, not again act as the sink for gas if the world is in oversupply but ending up short if it is not.

Shell published their annual LNG Outlook some days ago. A very good and easy to read overview of the global market.

https://www.shell.com/promos/energy-...tlook-2022.pdf

I am not sure though if it will be great for every European country if Russia is losing market share in Europe. I mean the consequences for Europe, not Russia — some power shifts might happen in Europe and in EU because of this. This might be not so great in the end, at least for some. It would be interesting to know who will benefit and who will lose.

That's exactly my point, I was trying to explain that at 5% inflation out of which half is energy, the Russian impact would be what? A quarter of that half? Half of the half? Just for the sake of the argument let's assume it would contribute 0.5% to the overall inflation. Sure, no small thing, but hardly an apocalypse scenario for European economies. Posters here were implying that this would lead to people going homeless in Europe, which is hardly a realistic scenario.


On the contrary. Eastern Europe is heavily dependent on Russian gas and even Romania which has reserves is importing. This is to a great extent driven by the hard-play tactics of Gazprom in countries such as Romania and Bulgaria which would only benefit if forced to diversify. The contracts in those countries are very political and with significant corruption attached to them. A crisis is a terrible thing to waste and I hope forced diversification will wean them off Russia which has been using gas as a political tool for decades.

As they are in Hungary as Orban is friends with Putin, Austria and probably all the rest. You forgot OMV's (which is Austrian, the irony, a country with no gas and oil reserves) manoeuvres.

Anyways, yes, I totally agree we are dependent on the Russian gas. Who isn't in Europe? Who has made non-political contracts with Russia? What is Nord Stream 2 after all ????

A very explicit study here about Gazprom's ramifications and modus operandi back already in the 2000's

https://www.files.ethz.ch/isn/113176/GP_EU_10_09_en.pdf

I am sorry to hear that your homeless (if I am reading correctly) definitely not a nice situation to be in.

Puts life into a new perspective indeed

Not suprisingly, Comrade Trump is siding with Vlad...

https://edition.cnn.com/2022/02/23/p...den/index.html

Guess a Star of Lenin is in order!

Funny. I think you should read hist post again. But what do I know, maybe he *is* homeless.

Not only Trump. Half the GOP it seems, plus of course FOX. It is time for GWB to call out this bullshit and make a point that the current GOP is a bunch of lunatics and puppets. Not that it will help much, but still.

I don’t think he is actually homeless, he was using it as a general example not specifically in relation to himself.

It's absolutely sad and scary how the US politics is developing. A GOP with an instinct to support and almost envy dictators with no regard for the rule of law or foreign borders and a Dem party which is unable to formulate a coherent unifying message and which tries to be everything to everybody.

Don’t forget Vladimir still has those naughty photos of Donald and Prince Andy

So Johnson is giving just enough time for all the dirty Russian money in London to be taken out and moved around.

Where will it go?