Russian Gas ban - A problem for Europe or suicide for Russia?

[pooya87]

Right now Russia has around 150,000 soldiers in Ukraine, which is not sufficient to capture large areas outside what they already control. Even in the eastern part (East Kharkiv, Donest and Lugansk), most of the gains were made by the militia of DPR and LPR, who are more knowledgeable about the terrain. Russian forces have struggled to make gains in areas which they control and are constantly losing territory (North Kharkiv, Kherson, Zaporozhia.etc).

Russia's goal was neither what the Western propaganda says nor what the Russian propaganda says. It wasn't to occupy Ukraine, control large territories, take Kyiev, denazify,... It was simply to neutralize the Ukrainian security threat posed through US and NATO, and that is achieved by 2 things: first by destroying Ukraine's military capabilities which Russia has done to some extent and to capture key territories namely the eastern Ukraine (border with Russia) and the south to cut off access to the Black sea. That part of the plan is also 90% complete. In fact annexing Crimea back in 2014 was also both a warning and part of this plan.

P.S. Funny how at least 10 members of European Union are currently paying Russia in Ruble (not even in Euros or USD but in Russian currency) to buy their gas and oil while they publicly say everyone else should stop doing it
P.P.S. Russian Ruble is currently at its highest value ever since 2020. In other words their currency got stronger after they invaded Ukraine thanks to Europe
The politics are so funny sometimes specially when you think about how Ukraine's regime was so eager to join Europe, in other words to join the same alliance that is currently helping Russia in reality while bashing it only in words...

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[Victorik]

If as you said that the Russian economy depend so much on the sales of gas and oil, then I think banning the sales of gas to EU countries will do Russians more harm than good. China will definitely take advantage of this situation since they are now the major buyers.
However, it won't be easy on the European countries as they now have to seek other alternatives to Russian gas, this will affect their economy as well. But as it's been said, necessity is the mother of innovation. They have been surviving without Russian gas and oil.

[Frengki_cisco]

Let's keep in mind some important facts from the very beginning:
1. 45% of Russia's federal budget in 2021 came from oil and natural gas revenues
2. 49% of Russia's crude oil and condensate exports went to European OECD nations.
3. Supplies from Russia account for about 40% of the EU's natural gas imports
4. just under three-quarters of all Russian natural gas exports went to European countries in 2021

If Russia's income comes from gas, of course the ban will have a bad impact on the Russian economy, that's automatic, but what's serious in this problem is not that, believe it or not europe needs gas from russia, even though bans and sanctions keep coming from various parties, gas still flows to europe.

[Sithara007]

~~
P.S. Funny how at least 10 members of European Union are currently paying Russia in Ruble (not even in Euros or USD but in Russian currency) to buy their gas and oil while they publicly say everyone else should stop doing it
P.P.S. Russian Ruble is currently at its highest value ever since 2020. In other words their currency got stronger after they invaded Ukraine thanks to Europe
The politics are so funny sometimes specially when you think about how Ukraine's regime was so eager to join Europe, in other words to join the same alliance that is currently helping Russia in reality while bashing it only in words...

Even more funnier is the fact that now Russia is earning more thanks to the sanctions. As a result of these sanctions and embargoes the gas prices have gone up by multiple times and the crude oil prices have reached a level not seen since 2014. They maybe selling less amount of oil and gas, but from these exports, they are earning more revenues. For the year 2021 Gazprom alone earned a profit of close to $21 billion (almost 20x higher than the level from 2020). For the year of 2022, the profits are going to be even higher.

[Ozero]

~~
P.S. Funny how at least 10 members of European Union are currently paying Russia in Ruble (not even in Euros or USD but in Russian currency) to buy their gas and oil while they publicly say everyone else should stop doing it
P.P.S. Russian Ruble is currently at its highest value ever since 2020. In other words their currency got stronger after they invaded Ukraine thanks to Europe
The politics are so funny sometimes specially when you think about how Ukraine's regime was so eager to join Europe, in other words to join the same alliance that is currently helping Russia in reality while bashing it only in words...

Even more funnier is the fact that now Russia is earning more thanks to the sanctions. As a result of these sanctions and embargoes the gas prices have gone up by multiple times and the crude oil prices have reached a level not seen since 2014. They maybe selling less amount of oil and gas, but from these exports, they are earning more revenues. For the year 2021 Gazprom alone earned a profit of close to $21 billion (almost 20x higher than the level from 2020). For the year of 2022, the profits are going to be even higher.

This effect is temporary, as the reorientation of European Union countries away from Russian oil and gas towards other countries and alternative sources disrupts established supply chains, intensifies panic, and then raises the price. Everything will soon return to normal, and then, in the medium term, Russia will suffer enormous losses from which it will never be able to recover.

Yes, sanctions are not economically beneficial for the countries of the European Union now, but they understand that it is better to take such measures now, but to get rid of the long-term threat from unpredictable Russia.

[darewaller]

Even more funnier is the fact that now Russia is earning more thanks to the sanctions. As a result of these sanctions and embargoes the gas prices have gone up by multiple times and the crude oil prices have reached a level not seen since 2014. They maybe selling less amount of oil and gas, but from these exports, they are earning more revenues. For the year 2021 Gazprom alone earned a profit of close to $21 billion (almost 20x higher than the level from 2020). For the year of 2022, the profits are going to be even higher.

I do agree that gas prices going up, oil prices all going up ended up helping Russia and their Ruble is not doing that bad at all. At the start of this war, it was around 75 per dollar, and it peaked at around 130 if I am not wrong when the war started, right now it went under 70, which is better than before basically. Obviously, you can't just calculate a nations economy based on their fiats Dollar pair rate, but that is a good indicator of what’s going on for sure.

I mean if you are doing fine and getting more valuable against dollar, even better than before the war started, then you should be feeling at ease of what’s going on at least. Sanctions definitely didn't work out as intended.

[stompix]

Even more funnier is the fact that now Russia is earning more thanks to the sanctions. As a result of these sanctions and embargoes the gas prices have gone up by multiple times and the crude oil prices have reached a level not seen since 2014. They maybe selling less amount of oil and gas, but from these exports, they are earning more revenues. For the year 2021 Gazprom alone earned a profit of close to $21 billion (almost 20x higher than the level from 2020). For the year of 2022, the profits are going to be even higher.

This happens when you chew Russian propaganda all day and forget about the context, clearly stated in every article.
So Gazprom made a huuuuuge profit of close to $21 billion in 2021, and this was a surprise because?

The company, which reported a net profit of 1.456 trillion rubles ($23 billion) for 2018, has been going through an unprecedented management reshuffle.

https://www.reuters.com/article/us-gazprom-results-idUSKCN1S51DU

So despite record gas prices, it was a worse year than a year we didn't have covid, can you now use your magical armchair general mega economist prediction skills and explain how the profit sank even with those x15 prices? As for the 10 countries that have accepted to pay in rubles, I wonder if anybody can actually prove that, unless we're talking about Ossetia, Abkhazia, Transnistria, Chechnya, and so on. Maybe we would have to add even Bartovia to reach 10.

Now, if you would have just accepted that bet about Russia conquering Ukraine in a few weeks and if the world would spring the other way around you would have had a full bitcoin by now. But, as usual, only talk, no spine!

[pooya87]

This effect is temporary, as the reorientation of European Union countries away from Russian oil and gas towards other countries and alternative sources disrupts established supply chains, intensifies panic, and then raises the price. Everything will soon return to normal, and then, in the medium term, Russia will suffer enormous losses from which it will never be able to recover.

I don't think that is even possible.
For example gas, there is infrastructure in place that transfers it easily from Russia to Europe. You can't just build another gas line all the way to another farther country. It takes years and the route should go through regions that are unstable. Not to mention that other sources like Qatar for example are not capable of producing 1/1000 of the same amount of gas that Russia is producing and countries that can like Iran are not going to sell it to Europe.
Buying it from elsewhere through other means would also significantly increase the price and won't cover the needs either. To transfer gas using a ship for example you have to first turn it liquid (LNG) which significantly increases the cost and the amount that would be shipped is still not going to be enough.

The problem is the same with oil.
They went to the Arabs and they couldn't increase their production any more. They went to Venezuela and they didn't comply and their infrastructure is already weak and US sanctions prevents them from improving it too so that failed too. They went to Iran that can both produce and ship more than enough oil but Mora met a middle finger 2 days ago so that's not gonna happen either.

Yes, sanctions are not economically beneficial for the countries of the European Union now, but they understand that it is better to take such measures now, but to get rid of the long-term threat from unpredictable Russia.

They haven't even begun sanctioning Russia. If you check the list of sanctions, 90% of them are jokes (like sanctioning Putin's ex-lover or the Russian cats from entering the Cat Show!) an the remaining 10% that target things like Russian energy or banks are not enforced since they are buying it using Russian banks and currency!!

[riso2015]

If as you said that the Russian economy depend so much on the sales of gas and oil, then I think banning the sales of gas to EU countries will do Russians more harm than good. China will definitely take advantage of this situation since they are now the major buyers.
However, it won't be easy on the European countries as they now have to seek other alternatives to Russian gas, this will affect their economy as well. But as it's been said, necessity is the mother of innovation. They have been surviving without Russian gas and oil.

It's true as you said, China will take advantage of Russia's gas ban, because China and Russia relations are still going very well until now, China is a country that always wants to take advantage of every opportunity, like India which gets big profits because they buy cheap oil from russia, so i think this ban could be a big problem for european countries.

[Freeesta]

I think that the main result of the government's actions is to protect its people and create good conditions for them to live and have children. I don't want to think about how other countries will live with or without gas. It is important for me that my family is warm and that we have food. I think any government should take care of this. If people live well in my country, that suits me. let the governments of other countries think about the life of their people, this is their job and they get paid for it. I want to live in a warm house. If someone wants to kindle a fire to keep warm - this is his desire. It is possible that living without gas is better and more environmentally friendly. But it's not for me.

[be.open]

This effect is temporary, as the reorientation of European Union countries away from Russian oil and gas towards other countries and alternative sources disrupts established supply chains, intensifies panic, and then raises the price. Everything will soon return to normal, and then, in the medium term, Russia will suffer enormous losses from which it will never be able to recover.

I don't think that is even possible.
For example gas, there is infrastructure in place that transfers it easily from Russia to Europe. You can't just build another gas line all the way to another farther country. It takes years and the route should go through regions that are unstable. Not to mention that other sources like Qatar for example are not capable of producing 1/1000 of the same amount of gas that Russia is producing and countries that can like Iran are not going to sell it to Europe.
Buying it from elsewhere through other means would also significantly increase the price and won't cover the needs either. To transfer gas using a ship for example you have to first turn it liquid (LNG) which significantly increases the cost and the amount that would be shipped is still not going to be enough.

The problem is the same with oil.
They went to the Arabs and they couldn't increase their production any more. They went to Venezuela and they didn't comply and their infrastructure is already weak and US sanctions prevents them from improving it too so that failed too. They went to Iran that can both produce and ship more than enough oil but Mora met a middle finger 2 days ago so that's not gonna happen either.

Europe could not even reach an agreement with Qatar, Qatar put forward unacceptable demands (a long-term contract for 20 years and a guarantee of protection from European antimonopoly prosecution). It will be extremely difficult for Europe to agree with anyone, why increase production for the sake of a region that has a strategy to reduce its carbon footprint?

[DrBeer]

Right now Russia has around 150,000 soldiers in Ukraine, which is not sufficient to capture large areas outside what they already control. Even in the eastern part (East Kharkiv, Donest and Lugansk), most of the gains were made by the militia of DPR and LPR, who are more knowledgeable about the terrain. Russian forces have struggled to make gains in areas which they control and are constantly losing territory (North Kharkiv, Kherson, Zaporozhia.etc).

Russia's goal was neither what the Western propaganda says nor what the Russian propaganda says. It wasn't to occupy Ukraine, control large territories, take Kyiev, denazify,... It was simply to neutralize the Ukrainian security threat posed through US and NATO, and that is achieved by 2 things: first by destroying Ukraine's military capabilities which Russia has done to some extent and to capture key territories namely the eastern Ukraine (border with Russia) and the south to cut off access to the Black sea. That part of the plan is also 90% complete. In fact annexing Crimea back in 2014 was also both a warning and part of this plan.

P.S. Funny how at least 10 members of European Union are currently paying Russia in Ruble (not even in Euros or USD but in Russian currency) to buy their gas and oil while they publicly say everyone else should stop doing it
P.P.S. Russian Ruble is currently at its highest value ever since 2020. In other words their currency got stronger after they invaded Ukraine thanks to Europe
The politics are so funny sometimes specially when you think about how Ukraine's regime was so eager to join Europe, in other words to join the same alliance that is currently helping Russia in reality while bashing it only in words...

This is very cool, I applaud you!
Now please answer a few questions:
1. Is the Russian economy self-sufficient or import-dependent?
2. Import-dependent economy, forced to buy something from exporters, what currency should be calculated?
3. And if everyone pays her for the main product exported by Russia, in rubles - where will Russia take the currency to pay for imports?

Remember the main axiom - in fact, any step by Russia is "shooting yourself in the foot"! Why ? This question is for them

[Sithara007]

Europe could not even reach an agreement with Qatar, Qatar put forward unacceptable demands (a long-term contract for 20 years and a guarantee of protection from European antimonopoly prosecution). It will be extremely difficult for Europe to agree with anyone, why increase production for the sake of a region that has a strategy to reduce its carbon footprint?

Qatar is one of the major beneficiaries from this war, along with the United States. The EU will end up importing LNG from Qatar and the United States, which will cost them 5x when compared to the pipeline gas from Russia. And this is one of the reasons why the United States is pressuring the EU to stop gas and oil imports from Russia. Americans are planning to significantly increase the gas output and sell them to EU. And producers such as Qatar knows that their super expensive gas will never be able to directly compete with cheap Russian gas. And that is exactly why they are asking for 20-year and 30-year contracts. Once the contracts are signed, Europeans are fucked for ever.

[be.open]

Europe could not even reach an agreement with Qatar, Qatar put forward unacceptable demands (a long-term contract for 20 years and a guarantee of protection from European antimonopoly prosecution). It will be extremely difficult for Europe to agree with anyone, why increase production for the sake of a region that has a strategy to reduce its carbon footprint?

Qatar is one of the major beneficiaries from this war, along with the United States. The EU will end up importing LNG from Qatar and the United States, which will cost them 5x when compared to the pipeline gas from Russia.

If Europe manages to agree on this with Qatar, there are still disagreements. Meanwhile, Germany has a dilemma as to who should be turned off first in the event of a shortage of gas - private households or industrial enterprises.

[DrBeer]

This effect is temporary, as the reorientation of European Union countries away from Russian oil and gas towards other countries and alternative sources disrupts established supply chains, intensifies panic, and then raises the price. Everything will soon return to normal, and then, in the medium term, Russia will suffer enormous losses from which it will never be able to recover.

I don't think that is even possible.
For example gas, there is infrastructure in place that transfers it easily from Russia to Europe. You can't just build another gas line all the way to another farther country. It takes years and the route should go through regions that are unstable. Not to mention that other sources like Qatar for example are not capable of producing 1/1000 of the same amount of gas that Russia is producing and countries that can like Iran are not going to sell it to Europe.
Buying it from elsewhere through other means would also significantly increase the price and won't cover the needs either. To transfer gas using a ship for example you have to first turn it liquid (LNG) which significantly increases the cost and the amount that would be shipped is still not going to be enough.

The problem is the same with oil.
They went to the Arabs and they couldn't increase their production any more. They went to Venezuela and they didn't comply and their infrastructure is already weak and US sanctions prevents them from improving it too so that failed too. They went to Iran that can both produce and ship more than enough oil but Mora met a middle finger 2 days ago so that's not gonna happen either.

Europe could not even reach an agreement with Qatar, Qatar put forward unacceptable demands (a long-term contract for 20 years and a guarantee of protection from European antimonopoly prosecution). It will be extremely difficult for Europe to agree with anyone, why increase production for the sake of a region that has a strategy to reduce its carbon footprint?

Firstly, not the EU but Germany! Secondly, the main problem that is being discussed now is the term of the contract. Qatar wants 20 years. And Germany has already launched a “farewell to Russian gas, oil and coal” program as part of a program to reduce emissions into the atmosphere, and according to the approved plan, Germany should reduce carbon dioxide emissions by 88 percent by 2040. This means that gas purchases should also be reduced until 2040, and not only in Russia. And 2040-2022 = 18, but not 20 years, do you get the point? I'm sure the issue will be resolved. The question remains unresolved - where will Russia put its gas, oil, coal, which no one needs?!

[stompix]

The question remains unresolved - where will Russia put its gas, oil, coal, which no one needs?!

You're wasting your time with people who even if they saw Kremlin on fire they will say it's the White house.
The total logic failure in their propaganda is beyond cure, just read:

- Europe can't get 150 million of gas pipes and gas, Russia will export 150 billion to China and India via, pipes that will be built starting 2026
- Russia will sell 150 billion in gas to China and India, but Europe can't get that because...long contracts
But if Qatar and the rest are bonded by long term contracts with all of South Asia, how will Russia replace them, and wouldn't that mean all the Arabian gas then can be redirected elsewhere
- Europe can't build enough LNG gas facilities, and Russia will export its gas to South Asia via LNG ...for which it has no facilities
- Gazprom posted records of 20x in profit compared to 2020 because of prices being 15 times higher, but, still 20% lower than 2018..because...crickets
- Russia is making a killing because oil prices are higher than before, although the Ural sells at 75$ and Espo at $80, which is actually lower than what they were getting in 2018 

But you will not see them commenting facts, they will come with the 10 countries that agree on paying in roubles, as this would change a thing, they will come with Urakine will be conquered is Russia would commit, and stuff like that. Meanwhile, on Russian state tv:
https://mobile.twitter.com/TechTraderView/status/1523389860748271616

Look at their faces, live on national television they are told, nothing we can do against a Nato army.
The same guys that were talking about conquering Lisbon in a week. 

[be.open]

Firstly, not the EU but Germany! Secondly, the main problem that is being discussed now is the term of the contract. Qatar wants 20 years. And Germany has already launched a “farewell to Russian gas, oil and coal” program as part of a program to reduce emissions into the atmosphere, and according to the approved plan, Germany should reduce carbon dioxide emissions by 88 percent by 2040. This means that gas purchases should also be reduced until 2040, and not only in Russia. And 2040-2022 = 18, but not 20 years, do you get the point? I'm sure the issue will be resolved. The question remains unresolved - where will Russia put its gas, oil, coal, which no one needs?!

OK, Germany cannot agree with Qatar on the supply of liquefied natural gas. Qatar does not want to increase production for the sake of a country that is going to reduce its gas consumption in the long term. Qatar also fears that its profits from gas supplies to Germany will be nullified by European antitrust law. Qatar also does not want the gas it supplies to be resold to other European countries. There are several reasons, but the result is the same - Germany does not have an agreement with Qatar on gas supplies.

[jootn2kx]

Green energy, high-tech, and crypto will be the pillars on which the future civilized society will stand. Fossil fuel-based economies like that of Russia are pretty much done with anyway - this war only expedites Russia's inevitable demise as an impactful player from the economic standpoint. So gas ban or not, Russia's geopolitical ambitions or not, the world needs to reduce its dependency on fossil fuels while the crypto community needs to find solutions for PoW mining.

[popeye95]

Firstly, not the EU but Germany! Secondly, the main problem that is being discussed now is the term of the contract. Qatar wants 20 years. And Germany has already launched a “farewell to Russian gas, oil and coal” program as part of a program to reduce emissions into the atmosphere, and according to the approved plan, Germany should reduce carbon dioxide emissions by 88 percent by 2040. This means that gas purchases should also be reduced until 2040, and not only in Russia. And 2040-2022 = 18, but not 20 years, do you get the point? I'm sure the issue will be resolved. The question remains unresolved - where will Russia put its gas, oil, coal, which no one needs?!

OK, Germany cannot agree with Qatar on the supply of liquefied natural gas. Qatar does not want to increase production for the sake of a country that is going to reduce its gas consumption in the long term. Qatar also fears that its profits from gas supplies to Germany will be nullified by European antitrust law. Qatar also does not want the gas it supplies to be resold to other European countries. There are several reasons, but the result is the same - Germany does not have an agreement with Qatar on gas supplies.

Germany doesn't have an agreement with Qatar but there is another player that you haven't accounted for. US going to apply pressure on the oils cartel with NOPEC bill that allows US to sue the oil cartel or its members, force them to increase their oil production or risk of their assets frozen in US banks or no business with US's entities. If those cartel doesn't like it, they can open up a shooting war with US which I'm sure US will be happier to have more oil country under their control.

[Sithara007]

Germany doesn't have an agreement with Qatar but there is another player that you haven't accounted for. US going to apply pressure on the oils cartel with NOPEC bill that allows US to sue the oil cartel or its members, force them to increase their oil production or risk of their assets frozen in US banks or no business with US's entities. If those cartel doesn't like it, they can open up a shooting war with US which I'm sure US will be happier to have more oil country under their control.

LOL.. do you really believe that at this point, the United States government has the guts to act against the OPEC cartel? Any such move would mean crude oil surging beyond the $200 per barrel level, and it will cause immediate economic ruin to oil importing nations such as Germany, Japan and France. The US will be fine, because they produce most of the oil and gas which they consume within their borders. So far OPEC members such as Saudi Arabia has refused demands from the US to increase oil production, because they don't see any economic benefit from doing so.