Moon of Alabama Brecht quote
April 01, 2022

Europe Must Learn To Cheat On Its Sanctions (Just Like The U.S. Is Doing It)

The European Union and China will hold a virtual summit today. Before the summit started Brussels has strewn rumors that it would pressure China to not support Russia.

China is of course rejecting any pressure and retaliates by pointing out Europe's weak strategic autonomy:

Hours before the China-EU leaders' meetings on Friday, Chinese analysts warned that China-EU relations cannot be kidnapped by the Ukraine crisis, and Europe should no longer be abducted by the US in foreign policy, as it will greatly undermine the EU's own interests, making it difficult to ensure economic recovery and people's livelihood, and runs counter to Europe's aim of pursuing strategic independence.
As the Russia-Ukraine conflict stretches to over a month, Europe has sustained great pressure resulting from sanctions against Russia and its over-reliance on US-led NATO security structure.

"The EU is now kidnapped by the US on security, but that does not conform to the strategic independence EU has pursued," [Cui Hongjian, director of the Department of European Studies at the China Institute of International Studies] said.

To avoid being caught in hot water again, the EU must take control of its own destiny. And developing ties with China provides the EU an opportunity to develop in a more balanced and comprehensive way in the long term, he said.

Its reliance on the U.S./NATO is Europe's core strategic weakness. The U.S. has used it to infiltrate Europe's decision making structures.

When the current Ukraine crisis began the U.S. announced that it had activated certain sanctions against Russia and told Europe to do the same. Europe then decide to deliver even more sanctions than it was told to do. With that done the U.S. has quietly buried or circumvented some of its own sanctions after it had used them to push the Europeans.

On March 8 the White House announced:

Today, President Biden will sign an Executive Order (E.O.) to ban the import of Russian oil, liquefied natural gas, and coal to the United States – a significant action with widespread bipartisan support that will further deprive President Putin of the economic resources he uses to continue his needless war of choice.

The United States made this decision in close consultation with our Allies and partners around the world, as well as Members of Congress of both parties.
Today’s Executive Order bans:

  • The importation into the United States of Russian crude oil and certain petroleum products, liquefied natural gas, and coal. Last year, the U.S. imported nearly 700,000 barrels per day of crude oil and refined petroleum products from Russia and this step will deprive Russia of billions of dollars in revenues from U.S. drivers and consumers annually. ...

The Executive Order is here and it does seem to prohibit crude oil imports from Russia.

However, three weeks later the U.S. is still importing Russian crude oil. The U.S. Energy Information Administration publishes a weekly list of crude imports by country:


In the week ending March 26 the U.S. still imported 100,000 barrels per day of Russian crude oil.

I explained on March 7 why the U.S. needs the Russian oil:

Some U.S. refineries at the south coast are designed to only process heavy oil variants. Since 2019 the U.S. has blockaded heavy oil imports from Venezuela and replaced them with imports of heavy Ural variants from Russia. It has now send two officials to Caracas to try to get Venezuela's oil flowing again. That would of course require to lift all sanctions off Venezuela and to return all confiscated companies and the gold that is owned by that country. It is not going to happen anytime soon.

Diesel and heating oil consist of long hydrocarbon chains. Lighter types of crude oil lack these. There are ways to create longer hydrocarbon chains from shorter ones but those processes are expensive. It is much easier to start off with heavy crude oil and to break it down when needed.

Without heavy Russian Ural crude oil the U.S. has no efficient way to create diesel and heating oil. This while we are in a global diesel crisis:

Diesel is what freight transport uses to deliver goods to consumers, but it is also what industrial transport uses for fuel. With Russian refiners cutting their processing rates in the wake of several waves of Western sanctions, already tight diesel supply is going to get a lot tighter.

"Governments have a very clear understanding that there is a clear link between diesel and GDP, because almost everything that goes into and out of a factory goes using diesel," the director general of Fuels Europe, part of the European Petroleum Refiners Association, told Reuters this week.

As Vitol's Russell Hardy noted earlier this week, "Europe imports about half of its diesel from Russia and about half of its diesel from the Middle East. That systemic shortfall of diesel is there."

Europe is not the only one feeling the diesel pinch, however. Middle distillate stocks are on a decline in the United States, too, Reuters' John Kemp wrote in his latest column.

The Biden administration announced yesterday that it would release 1 million barrels of crude oil per day from the U.S. Strategic Petroleum Reserve (SPR). While this voter bribe will likely lower elevated gasoline prices it is doubtful that the SPR includes enough heavy crude to make a difference in the diesel market.

It is diesel, more than gasoline, that is driving inflation.

The U.S. is therefore likely to continue to cheat on its own sanctions. Europe should recognize that and should likewise handle its sanction in a matter that lessens the economic effects on itself. It will otherwise ruin its citizens.

It should also handle its relation with China, its largest trading partner, aside from the U.S. and the Ukraine-Russia mess up. Not doing so  only increases the size of the recession it is soon likely to experience.

Posted by b on April 1, 2022 at 15:57 UTC | Permalink

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I believe the USA ban on Russian imports will actually start mid-April due to the sun-setting of delivery contracts that were already in place. Yves at nakedcapitalism noted this at some point this month, although I am fuzzy on the details.

Posted by: scarnoc | Apr 1 2022 16:01 utc | 1

Another explanation for the gas for rubles scheme, including this:

The transaction mechanics above also means the payment to Gazprom is net of the foreign exchange transaction costs. Gazprom eats that, not the gas buyer.

Posted by: Boo | Apr 1 2022 16:08 utc | 2

thanks b...

when will europe recognize how this works and stop being manipulated?? you hit the nail on the head here -

"Its reliance on the U.S./NATO is Europe's core strategic weakness. The U.S. has used it to infiltrate Europe's decision making structures."

Posted by: james | Apr 1 2022 16:09 utc | 3

Social media is ablaze with the oil depot getting hit by the Ukrainian airforce. Things get through eventaully, the enemy only has to get lucky once and, for the die-hards in Kiev and The Guardian, the fire provides a bit of jouissance after all the terrible news of the past few weeks.

Posted by: steve brown | Apr 1 2022 16:11 utc | 4

Its reliance on the U.S./NATO is Europe's core strategic weakness. The U.S. has used it to infiltrate Europe's decision making structures.

Infiltrate would be an incorrect term. These structures were created post WWII in the original EU countries and Japan. The new EU Eastern European nations have signed on to "dollar diplomacy". Their hatred of anything Russian from past historical problems real or imagined is motivation as well.

What I see happening is that Russian oil will be blended in Venezuela and imported into the US as Venezuelan oil. Anything to keep the game going.

Posted by: circumspect | Apr 1 2022 16:18 utc | 5

Rudolf Diesel, in full Rudolf Christian Karl Diesel, (born March 18, 1858, Paris, France—died September 29, 1913, at sea in the English Channel), German thermal engineer who invented the internal-combustion engine that bears his name. Diesel disappeared from a steamer en route to London. His body was recovered on the shore days later. The circumstances surrounding his death are still a mystery. Some believe he may have committed suicide, while others speculate that he was murdered by coal industrialists.

Posted by: Don Bacon | Apr 1 2022 16:18 utc | 6

@ Boo 2
Gazprom eats [transaction costs], not the gas buyer.
Doesn't Gazprom set the price?

Posted by: Don Bacon | Apr 1 2022 16:20 utc | 7

@ circumspect | Apr 1 2022 16:18 utc | 5

i agree with you, especially this quote - "Their hatred of anything Russian from past historical problems real or imagined is motivation as well." i found this out reading margarat macmillians book 'paris 1919' discussing how the treaty of Versailles was arrived at..

Posted by: james | Apr 1 2022 16:22 utc | 8

I have more respect for Charles de Gaulle now, he saw through the US from the start, and more importanly resisted it.

Posted by: pretzelattack | Apr 1 2022 16:28 utc | 9

Roughly starting from 2019, EU's synchronization of its external policies with the US foreign policies can be clearly discerned. EU CIA linked MPs visited Taiwan times and again, parroting US false flags and attacking anything China.

The vassal state of EU is well known, and its status as an attack dog of the US is self evident. The current Russia sanctions, just think about it, EU, who is benefiting from it with minimal hurt? Think, EU! Funny thing is that these sycophants still don't get it.

How could EU consider that they have any persuasive power to dictate China? China shall satisfy its national interests, just like EU satisfy its master's interests.

A bunch of hallucinating nuts.

Posted by: KitaySupporter | Apr 1 2022 16:31 utc | 10

What does "gas for rubles" mean?

Three things to note:

1) Russian companies will no longer get Western "hard" currency. It is now all confiscated by the state. Companies can only own the "less valuable" Rubles. (Almost like in Soviet times.)

2) All transactions happen under Russian jurisdiction. The West cannot block or sanction accounts.

3) The rubles-for-gas requirement applies to old Euro/Dollar nominated contracts. All of them have long-term pricing that is far below spot or market prices. If Western buyers default on payments, it frees Russia from the old obligations and pricing. Western customers will have to buy their gas from the spot market at triple the price.

P.S. - Karlof1 posted a translation of Putin's statement. It is now also published on the Saker.

Posted by: Petri Krohn | Apr 1 2022 16:37 utc | 11

Definition of insanity. Didn't China reject Europe's requests of abandoning Russia in the past?

Posted by: Ian2 | Apr 1 2022 16:37 utc | 12

[.]The U.S. is therefore likely to continue to cheat on its own sanctions.

Uncle Schmoe always cheats. Now it’s clear to everyone he will steal everything. If you do not hold it in your own safe. It ain’t yours.

If I may be permitted to move this morning’s post from yesterday’s thread.
The Rooster has crowed. So loud that he cracked the egg.
It's April 1st, 2022. It's DDD. Big news:

Russia's Gazprom announced today it’s exiting German business amid row over pricing

Russian energy giant Gazprom said on Friday it was exiting its business in Germany, amid a row between the two countries over Moscow's insistence on switching payments for Russian gas to roubles from euros. 

It was not immediately clear how the move would affect the supply of Russian gas, on which Germany depends for about 40% of its needs. [.]

Austria, Hungary Say No Substitute to Russian Gas as Germany’s BASF Warns of Worst Crisis Since WWII

Officials in Austria and Hungary say there’s no alternative to Russian natural gas, with Budapest stressing that more costly American-sourced LNG is not a realistic substitute.
“Replacing cheap Russian gas with expensive American gas” is an “absurd” proposal, Hungarian Prime Minister Viktor Orban told Kossuth Radio on Friday.

“It’s not that we’ll put on an extra sweater in the evening and turn the heating down a little or paying a few extra forints for gas. The fact is that if energy supplies don’t come from Russia there won’t be any energy in Hungary,” Orban stressed.

The politician noted that 85 percent of Hungary’s gas supplies and 64 percent of the country’s oil comes from Russia, and that geography puts limits on Budapest’s ability to diversify its sources of energy.
Austrian energy giant OMV CEO Alfred Stern echoed Orban’s concerns, saying that there was no LNG alternative for Austria.

“Giving up on Russian gas is impossible unless we are willing to live with the massive consequences of such a step. Some countries can do that. It cannot be implemented by Austria this year…As a landlocked country, we don’t have access to LNG. Any diversification would mean investing in more expensive infrastructure to get access to more expensive gas. (emphasis added)

‘Worst Crisis Since WWII’

Austria’s neighbour Germany, whose leaders have so far publicly refused to be “blackmailed” into paying for Russia’s gas in rubles, while privately inquiring about how such ruble payments could be made, is facing a similar dilemma, with Berlin activating an emergency plan to cope with supply disruptions and preparing to institute gas rationing. Russian deliveries made up 55 percent of the European industrial giant’s gas consumption in 2021, with Germany’s underground gas storage tanks down to 25 percent of capacity this week.

Martin Brudermuller, CEO of German chemicals giant BASF, has characterised Berlin’s plans to boycott ruble-priced gas as a “highly irresponsible experiment,” and stressed that Germans underestimate the true risks of such a step.[.]

The Emperor does not do geography. Ukraine, what’s that?
Russia? Oh, that’s the name of a gas station...and the cashier only accepts cash in local currency, Rubles.

OTOH. Watch Germany’s business Titans bringing the government in on a tight leash. 
Do we destroy our economy with our eyes wide open? Destroy everything we have been creating for decades?

Iran Wants to Trade With Russia in National Currencies, Deputy Head of Central Bank Tells Sputnik

And the switching over gathers pace.

Posted by: Likklemore | Apr 1 2022 16:44 utc | 13

the EU officials get their bribes even if their position on china is ineffectual, pointless and self defeating. they aren't actually there to safeguard national interests. so I'm not surprised they continue to spout nonsense. theyre paid to be shameless.

Posted by: mastameta | Apr 1 2022 16:50 utc | 14

@9 pretzelattack There is this quote that I have seen attributed to Charles De Gaulle, haven't been able to track down definitive documentation that he said it, but it sounds like he might have:

"The UK is an American aircraft carrier docked off the coast of Europe."

Which also reminded me of how Orwell named Britain "Airstrip One" in "1984"

I was in sixth grade when De Gaulle's "uncooperative" behavior was an item that came up in our "current events" topics. Yes I am old lol.

Posted by: Prairie Bear | Apr 1 2022 16:54 utc | 15

Bwahahaha, the US is applying the "international rules based order" on the EU too ie one (sanctions) rule for me and another (sanctions) rule for you!!

Posted by: Anon | Apr 1 2022 16:56 utc | 16

In the week ending March 26 the U.S. still imported 100,000 barrels per day of Russian crude oil.

b, how much in the grand scheme of the U.S. oil market really is that, though? Compared to Canada and other sources it would appear to be a drop in the bucket, pun intended.

Posted by: Tom_Q_Collins | Apr 1 2022 16:56 utc | 17

Posted by: Don Bacon | Apr 1 2022 16:20 utc | 7

The contracts are specified at certain cost in Euros. I guess the new arrangement forces the intermediary to take the changes in euro to ruble.

Posted by: Boo | Apr 1 2022 17:03 utc | 18

China and India are in no way "supporting Russia". International law allows for countries to remain neutral at times of conflict. The West is now demanding that every nation takes sides in what was essentially a Ukrainian civil war.

The last time this happened was during the Napoleonic Wars, when France established the Continental Blockade against the British Empire. The reason Napoleon marched to Moscow was because Russia refused to stop trading with the United Kingdom.

Napoleon's plan to defeat Britain was to destroy its ability to trade. As an island nation, trade was its most vital lifeline. Napoleon believed that if he could isolate Britain economically, he would be able to invade the nation after its economic collapse. Napoleon decreed that all commercial ships wishing to do business in Europe must first stop at a French port in order to ensure that there could be no trade with Britain. He also ordered all European nations and French allies to stop trading with Britain, and he threatened Russia with an invasion if they did not comply as well. His orders backfired in the Iberian Peninsula, especially in Portugal (being allied to Britain), setting off the Peninsular War. He pushed Russia too hard, both in terms of the Continental System, and in his demands for control over part of Poland. Napoleon's attempted 1812 invasion of Russia was a disaster which set the stage for his downfall.

Posted by: Petri Krohn | Apr 1 2022 17:04 utc | 19

I still fail to see how there is "no backdown" from the demand for "payment only in rubles". Under the described new arrangement, which has been circulating for a while now, Gazprombank will continue to receive euros as payment for gas, but then "internally convert" those to rubles. But what's important to understand here is that every financial transaction has two sides to it.

Every transaction between banks involves operations at the asset side and the liabilities side of both banks' balance sheets. Acquiring rubles has never been any issue for a Russian bank, as it is the country's own currency. The difficulty is actually getting rid of the euros it receives. And Russia has explicitly agreed - to the glee of the Europeans - that they will continue to accept euros into Russian accounts.

Gazprombank can either receive euros in a correspondent account in a European bank, or if it had a European subsidiary, in an account in a European central bank, for example the Bundesbank. Either way the euros it receives can be frozen (stolen), just like those of the Central Bank of Russia.

Any form of theft available to the West they will resort to as soon as they feel they can get away with it (for example, through Russia not actually turning off the gas in the response). The critical point therefore is getting rid of the "hot potato" in the form of euros in European banks, which Russia will now continue to receive in so-called payment for gas deliveries. That can only be done if they are allowed by the EU to spend those euros on imported goods and services, or to exchange them to the currency of a friendly third party like the Chinese yuan.

That is no different from the situation all the way back from February 24th, since Gazprombank was one of the banks excluded from sanctions. Yves Smith has had a few posts in a row now where she insists there is no "backdown", and has struck down very angrily at commenters who have raised the same questions that I do. But there certainly is a backdown from the Western perspective, if they feared they would no longer be able to pay with something they can't just steal back later.

Posted by: Unnamed | Apr 1 2022 17:08 utc | 20

The Europeans are acting like poodles, and that is unlikely to change. I believe it is because most of them have dirty laundry in the hands of US 3 letter agencies. The full spectrum surveillance mentioned by Edward Snowden is real, and most of the Eu politicians are scumbags full of dirty laundry….

Posted by: Alan | Apr 1 2022 17:09 utc | 21

No good news to be expected, I don't htink. It's going to get worse in most countries, and will be for a long time, before it gets better.

Posted by: ptb | Apr 1 2022 17:13 utc | 22

Posted by: Prairie Bear | Apr 1 2022 16:54 utc | 15

That's a great quote! yeah, I'm old, too, I think I was in 5th grade at the time de Gaulle was being widely mocked in the US. I fell for it, of course, at the time. There was a US comedy show at the time, I think it was called "That Was the Week That Was", based on a British show I think--de Gaulle was one of the targets of satire.

Posted by: pretzelattack | Apr 1 2022 17:15 utc | 23

Dmitry Medvedev's post today, together with the smilies. Google translation.

Our food against their sanctions

I remember that during my childhood, the USSR bought grain from Canada.
It was strange, the largest country, and wheat - for dollars.
Today the picture is quite different: Russia is the largest grain producer, along with India and China. And in recent years, the largest exporter of wheat.
It so happened that the food security of many countries depends on our supplies. It turns out that our food is our quiet weapon 😉. Quiet but ominous.
And if anyone does not know or has forgotten, then the export of our agricultural products exceeds the export of real weapons - it amounted to more than 37 billion dollars last year.
Taking into account the total sanctions imposed against us by Western countries, I will outline a few simple but important points regarding Russia's food security.

First. Diverse and delicious Russian products are enough to fully meet our domestic needs.

Second. The priority in food supplies is our domestic market. And price control.
At the same time, the state will continue large-scale and systematic assistance to farmers.

Third. We will supply food and crops only to our friends (fortunately we have a lot of them, and they are not at all in Europe and not in North America). We will sell both for rubles and for their national currency in agreed proportions.

Fourth. We will not supply our products and agricultural products to our enemies. And we won’t buy anything from them (although we haven’t bought anything since 2014, but the list of products prohibited for import can be further expanded).

It turns out that we will eat breakfast ourselves 🥐🍳🧀☕️. Perhaps we will share lunch with friends🥗🍲/🍛🥘. And we will not give dinner to the enemies🍧🍦🫖. Will manage. We’d better eat ourselves too, and in the morning we’ll work out more actively🏋🏻‍♂️🏸🚴🏻!

Posted by: ostro | Apr 1 2022 17:17 utc | 24

What I see happening is that Russian oil will be blended in Venezuela and imported into the US as Venezuelan oil. Anything to keep the game going.

Posted by: circumspect | Apr 1 2022 16:18 utc | 5

If they do that it would be a bit like the time five years ago when the USA cheated on its own sanctions - by shipping natural gas from the Yamal LNG plant which was being sanctioned. A senior Russian official sarcastically explained the justification:
According to Alexander Novak, the head of the Russian Energy Ministry, "although the molecules are from Russia, the gas is no longer Russian," as French Engie purchased it from Malaysia’s state oil and gas company Petroliam Nasional Berhad (Petronas).

Posted by: Brendan | Apr 1 2022 17:18 utc | 25

Here is an interesting bit from Michael Hudson about all the materials other than oil the US and Europe depend on, which the US wants to exempt from the sanctions. Kind of reveals that one of the big motives is to sell more fracked oil to Europe.

Posted by: Prairie Bear | Apr 1 2022 17:18 utc | 26

Unnamed | Apr 1 2022 17:08 utc | 20
"That can only be done if they are allowed by the EU to spend those euros on imported goods and services, or to exchange them to the currency of a friendly third party like the Chinese yuan."
Are you able to explain to a layman like me how this can be done? You paid 100 Euros to me for some service or material good, I got your money. How can I depend then on your allowance? Unless we make a contract that I accept: I can spend this money explicitely only there, or then, or for certain things, anything else would break that contract.

Posted by: Hausmeister | Apr 1 2022 17:20 utc | 27

It's to bad them Rooskies do not fire every last employee at Sputnik and RT and replace them with people who are not CNN rejects or in any way no matter how slightly "woke".

The Ukrainian war on Russia (27 biological weapons launch platforms 1 inch outside Russia's border, and 14,000 Russians who had the misfortune of being cut off from Russia, dead) would have won itself without a shot fired if them silly Rooskies did not install Western agents to run Sputnik and RT.

Retarded Rooskies. FIRE EVERYONE AT SPUTNIK AND RT, you idiots

Posted by: Carl | Apr 1 2022 17:24 utc | 28

The total servility to the US and not even the Chinese putting it to the EU in such a direct manner.
Total institutional capture and no one is going to mention that fact.
Maybe the Chinese are just playing a professional diplomatic courtesy by actually talking to the EU.
Because the EU is not an independent player it's irrelevant diplomatically now.

Posted by: Jpc | Apr 1 2022 17:34 utc | 29

What does "gas for rubles" mean?
Three things to note:
1) Russian companies will no longer get Western "hard" currency. It is now all confiscated by the state. Companies can only own the "less valuable" Rubles. (Almost like in Soviet times.)
Posted by: Petri Krohn | Apr 1 2022 16:37 utc | 11

Western “hard” currency? Explain.
All “currencies” in use referenced as fiat backed by “the full faith and credit of “ the issuer government. aka credit is now debt. Currency created by the click of the mouse.

And with the Rouble (Ruble) essentially now bound to gold - meaning, in practical terms, the RCB has put a floor price under gold in Rubles. Then, as at March 28, 2022 Rubles can’t be said to be less valuable.

This author MacLeod knows his stuff on the metals. A great article.

Consequently, I held my nose on his geopolitics …that "Putin was ill-advised, is losing the battle for Ukraine and Ukraine is valiantly winning the war." MacLeod drank UK's Secretary of Defense Ben Wally’s cocktail..... with Salisbury water. Btw, Stollenberg claimed Salisbury is NATO territory. I digress.

Edging towards a gold standard 
 By Alasdair Macleod

Commentators are trying to make sense of Russian moves. However, there is a back story which differs from much of the speculation, which this article addresses.

The Russians have not put the rouble on some sort of gold standard. Instead, they have repeated the Nixon/Kissinger strategy which created the petrodollar in 1973 by getting the Saudis to agree to accept only dollars for oil. This time, nations deemed by Russia to be unfriendly will be forced to buy roubles – roughly 2 trillion by the EU alone based on last year’s natural gas and oil imports from Russia — driving up the exchange rate.

The rouble has now doubled against the dollar from its low point of RUB 150 to RUB 75 yesterday in just over three weeks. The Russian Central Bank will soon be able to normalise the domestic economy by reducing interest rates and removing exchange controls


The Russians and Chinese will be acutely aware that Western currencies, particularly the yen and euro, are likely to be undermined by recent developments. The financial war, which has always been in the background, is emerging into plain sight and becoming a battlefield between fiat currencies, and it is full on.

The winner by default is almost certainly gold, now the only reliable reserve asset for those not aligned with Russia’s “unfriendlies”. But it is still a long way from backing any currency.[.]

Putin does judo….use your opponent’s perceived strength to topple.

Posted by: Likklemore | Apr 1 2022 17:36 utc | 30

The second after, and I don't mean a day or a week after, I mean the SECOND after Putin announced 'gas for Rubles' Sputnik and RT should have been explaining that instead of US Treasuries being transferred for payment, those transactions wholly on the books of financial institutions in New York City, now the actual currency is removed from New York and placed in Moscow, where Western Banksters can 'freeze' nothing.

There have been so many public relations missteps within Sputnik and RT it is NOT WORTH SAVING Sputnik or RT. End all Ru. finding and start new

Posted by: Carl | Apr 1 2022 17:39 utc | 31

May be its just me but for europe to kowtow US on whatever anti China games it's been playing, slapping sanctions after sanctions and now asking China to support them over Russia.... So fking sad, its like a stockholmed, battered wife apologizing for her abusive husband...

Still, you have give it to xi for keeping a straight face on the video.

So much schadenfreude, so little popcorns left...

In other news, Scott Morrison of the land down under has decided to piss more taxpayer money up the wall plus sending MRAPS to the meat grinder. Looking forward to seeing what's inside of them via telegram soon.

Posted by: A.L. | Apr 1 2022 17:40 utc | 32

Posted by: Petri Krohn | Apr 1 2022 17:04 utc | 19

Yet Napoleon's Grande Army still wore greatcoats made by Benjamin Gott in Leeds

Posted by: Paul Greenwood | Apr 1 2022 17:44 utc | 33

imho the best analysis so far and modestly exactly what I was thinking especially the last sentence:

Posted by: Olivier | Apr 1 2022 17:45 utc | 34

Diesel disappeared from a steamer en route to London.

He had been reading Nietzsche - enough said !

Posted by: Paul Greenwood | Apr 1 2022 17:46 utc | 35

Posted by: ostro | Apr 1 2022 17:17 utc | 24

So it turns out russia is not just a gas station masquerading as a country, it also has a pretty large supermarket attached to it.... LOL

Posted by: A.L. | Apr 1 2022 17:46 utc | 36

Posted by: Unnamed | Apr 1 2022 17:08 utc | 20

Do you really think that the Russians will offer this payment mechanism without thinking about the recycling of euros first? There is probably multiple "backstops".

Posted by: Boo | Apr 1 2022 17:46 utc | 37

Re: euros in new EU natural gas payment arrangement

People are not understanding the situation.

1) the euro is freely convertible. Fully convertible means there are theoretically no limitations on its use anywhere; in reality there are AML / anti terror restrictions.
This means Gazprombank can use euros to pay China, India, whoever (or more specifically, Gazprombank customers can).
2) the reason for this change is that it removes the need for the CBR to hold euros for trade liquidity purposes. The liquidity euros are a problem because they have to be euro bonds else the CBR loses value at maximum rate.
3) the ruble was convertible in the sense that the CBR would exchange rubles for other currencies freely; that is no longer true: ruble no longer convertible - econobrowser
What does this mean? It means before, the CBR would have the back of Russian companies holding foreign currencies in that these companies could freely exchange the foreign currencies for rubles. No more.
Companies can still hold dollars or euros, but they’re on their own converting them to rubles. There is also a law requiring some companies to immediately convert 80% of incoming foreign currency payments to rubles.

This is a major change and I doubt anyone really knows how it will work out short and medium term.
Long term, barring a total Russian economic collapse, it will strengthen the ruble.

Posted by: c1ue | Apr 1 2022 17:48 utc | 38

@Paul Greenwood (35)

Make that Nietsche.

Posted by: bjd | Apr 1 2022 17:51 utc | 39

Posted by: Hausmeister | Apr 1 2022 17:20 utc | 27

Think of it like this: I paid you 100 euros into your bank account, and we both now pretend that you have received payment for something you sold me, let's say natural gas. But I also happen to own the bank, and I make the banking regulations. (This is the position of the EU/US in relation to Russia.) I then tell you that since you are a "bad actor" and that you undermine our "rules-based world order", your deposit has been frozen.

I then simply take the money back by erasing your deposit (I instruct the bank to wipe your deposit, i.e. the bank's debt to you, from the books). My bank no longer owes you 100 euros, so I am 100 euros richer again. You now have zero euros in your account, there is nothing for you to withdraw (in cash, that I might not necessarily be able to control anymore) from the bank, there is no way you can spend the 100 euros you supposedly had, and so on. But I still keep the gas (for example) that you sold me. In this way, you were in a sense paid 100 euros by me, but only in a way that I could then easily steal back, by preventing you from ever actually transferring the funds from the system I control.

During all this, you (being Russia in this scenario) could "convert" these euros into rubles using any internal (i.e. not involving me in any way) scheme you wanted, by letting your "central bank" issue a certain amount of rubles, taking ownership of "your" euro deposit in exchange, or promising another party that they would receive for rubles they already held. But you could have done that anyway, since rubles are your own currency, and freely issued by you. There wasn't even any need to receive any euros, and certainly no need to give up any of the natural gas (a real good with real value) to me.

This is how Russia was vulnerable to having 300 billion dollars worth of (mostly dollar- and euro-denominated) reserves stolen from them. The West of course does not have to give back any of the energy and minerals they "paid" for with these deposits in Western banks. By still accepting to accumulate more euro deposits in European banks (with the immaterial difference that it's now a Gazprombank holding the European bank account, and not Gazprom), they are assuring that they will be vulnerable to the same theft, whenever the West feels the time is right.

This is despite explicit assertions by Peskov and Abramov, a Duma lawmaker, and if I'm not mistaken later Putin himself, that Russia "will certainly not keep selling gas for free". That is exactly what they have now agreed to, only with some embellishments, and that is precisely why the Western media (unfortunately rightly) describes this as a "walkback", "a face-saving measure for Putin", etc. I certainly hope this isn't the last development we will see, but at some point you have to recognize Russia's moves (in this particular area, not necessarily in all others) as indicative of weakness rather than of Trumpian 4D chess.

Posted by: Unnamed | Apr 1 2022 17:53 utc | 40

As I understand it, the entire point of the requirement that unfriendly nations pay for their gas in roubles is to prevent the sanctioning of at least those Russian banks through which the conversion takes place. It's a defense measure.

Notions that it has to do with "getting rid of euros" or "propping up the rouble" much less "creating a petro-rouble" are mistaken.

Posted by: WJ | Apr 1 2022 17:59 utc | 41

[.] The difficulty is actually getting rid of the euros it receives. And Russia has explicitly agreed - to the glee of the Europeans - that they will continue to accept euros into Russian accounts.

Gazprombank can either receive euros in a correspondent account in a European bank, or if it had a European subsidiary, in an account in a European central bank, for example the Bundesbank. Either way the euros it receives can be frozen (stolen), just like those of the Central Bank of Russia.[.]

Posted by: Unnamed | Apr 1 2022 17:08 utc | 20

The bit that Russia receives euros. These euros will be used to pay its obligations due on Eurobonds. Russia has not defaulted on its obligations:

Russia says it has fully paid $102 million coupon on 2035 Eurobond
By: Reuters
Updated: Mar 29, 2022, 05:19 EDT•1min read

The Russian finance ministry said on Tuesday it has fully paid a coupon on Russia’s Eurobond due in 2035, its third payout since unprecedented Western sanctions called Moscow’s ability to service foreign currency debt into question.

[.] a source familiar with the situation said the transaction was processed by correspondent bank JPMorgan Chase.
According to the Eurobond prospectus, settlement with investors occurs through the NSD and Euroclear, and “if, for reasons beyond its control, the Russian Federation is unable to make payments… in U.S. dollars”, settlement may be in euros, pound sterling, Swiss francs or Russian roubles. 

(emphasis added)

Prospectus and international Commercial Contracts covers known and the known unknowns.
Bet your last dollar or pet rock that the sanctions do have carve-outs especially given the exposure and interconectedness of Western banks.

Avoid total financial collapse of western banks is an imperative. Sanctions are for us peasants.

Posted by: Likklemore | Apr 1 2022 18:00 utc | 42

@pretzelattack | Apr 1 2022 16:28 utc | 9

I have more respect for Charles de Gaulle now, he saw through the US from the start, and more importanly resisted it.

and then he was deposed - was this the first Colour Revolution?

Posted by: cirsium | Apr 1 2022 18:02 utc | 43

maybe.The US was changing regimes right after world war 2, like in Greece.

Posted by: pretzelattack | Apr 1 2022 18:04 utc | 44

I'll never understand Europe putting US interests ahead of its own, the USA has far too much influence over Europe. Europe should be independent of all international influences, and free to trade with Russia, China the US and all other nations around the globe, disbanding Nato would be a good start.

Posted by: Republicofscotland | Apr 1 2022 18:04 utc | 45

Posted by: c1ue | Apr 1 2022 17:48 utc | 38

Russia can perform whatever "conversion" of currencies within its own economy. How did payment to oil and gas companies work before now? Were Gazprom and Rosneft workers and domestic suppliers paid in dollars? Did they pay excise taxes to the government in euros? No, they transferred the euro and dollar bank deposits to the Central Bank of Russia, which gave them rubles in return. Later, the West simply confiscated the dollars and euros which the CBR ended up stuck with. Now, it will instead be Gazprombank which receives the euros, and it's unclear who will end up stuck with the euros. What is certain is that it won't be European entities who will take the hot potato back in exchange for rubles, as the only thing Europe wants from Russia is energy and minerals, and those euros were how they got to "pay" Russia for those in the first place.

All of these measures are accounting exercies for Russia's internal use. The EU could not care less, as long as Russia (as a whole, that is private and public entities together) is content with accumulating financial claims on the Euro zone (that is, bank deposits in European banks) in exchange for actual oil, gas, metals etc., and the EU does not ever have to "take the euros back" by having to deliver real goods and services to Russia. The new arrangement changes nothing in this regard. Like I said, it only changes which Russian entity gets stuck with the hot potato (euro deposits vulnerable to freezing sanctions).

Posted by: Unnamed | Apr 1 2022 18:06 utc | 46

at the risk of appearing like a broken record...
the russian ruble for gas scheme as proposed by VVP comprises three different aspects:

the first aspect is the location of the bank receiving the euros. prior to the whole sanction mania, payment for gas could be done by transfering EUR amounts to the european subsidiary of gazprombank. EUR amounts would pile up in a bank with european banking license and within the jurisdiction of EU, such that the money would remain at risk. the EU could freeze the accounts, or impose some penalty on the bank for violating sanction.... VVP made it clear that in a first step EUR amounts are to be transfered to a russian bank, thereby getting the money out of the EU into russian jurisdiction., i.e. bringing the money to safety.

the second aspect has to do with the settlement process between banks/central banks. when money is transfered from one account at a first banks to another account at a second bank, one bank effectively owes money to the other, and this needs to be fixed by settling the accounts the banks themselves have at their central bank. for international transactions, in a further step, the two involved central banks need to settle their accounts, meaning meoney needs to be transfered from one central bank to the other. transfering a EUR amount from a european gas customer to a bank within russian jurisdiction in a straightforward manner requires settlement between the european central bank and the russian central bank. however, since the ECB claims to have stopped doing business with the russian central bank, this mechanism is broken. the demand of VVP for a transfer of EUR to a russian bank forces the europeans to ignore or circumvent their own sanctions. not that it would be much of a problem for the EU to circumvent their sanctions, but it still is a nice political twist.

the third aspect is that according to the scheme demanded by VVP the EUR amounts after arriving at a bank in russia need to exchanged to rubles thereat, such that final payment to the gas supplier is done in rubles. this of course stabilizes the ruble exchange rate, while at the same time keeping the EUR amount within the russian banking system.

not sure which of those three is most relevant but i would guess the first one.

Posted by: Sternberg | Apr 1 2022 18:08 utc | 47

Psaki gets tired of lying for White House, decides to cash in and make more money lying for MSNBC.

Posted by: pretzelattack | Apr 1 2022 18:09 utc | 48

Gazprom is cutting ties to its German subsidiary Gazprom Germania. Why? Because the German subsidiaries hold the actual gas contracts on the German (via other subsidiaries) and Gazprom can only renegotiate the contracts, when the German side becomes insolvent. So this moves prepares the playing field for Russia to enforce new prices and new means of payment. Russia is willing to sacrifice these assets for longterm goals. In the meantime, the German govt is thinking of expropriating the companies for exactly that reason: It wants to keep these companies alive to have the contracts as they are. A huge economic fight ist going on.

Posted by: Arne Hartmann | Apr 1 2022 18:11 utc | 49

pretzelattack (9).

Yes de Gaulle removed France from Nato in 1966, de Gaulle called for France to lead Europe and not the Americans. I doubt Macron could even lace de Gaulle's boots on this one.,amidst%20clashing%20American%20and%20Communist%20spheres%20of%20influence.

Posted by: Republicofscotland | Apr 1 2022 18:12 utc | 50

Of course the OTHER country that has all those metals and precious elements that the EU and US need - is China.
China is also "into" the BRI. What is not to like about world-wide trade links, many with very fast trains?

So the EU trying to tell the Chinese that "Urup" won't love them anymore if they carry on with others, is like the song; "It's my party and I'll cry if I want to".
1963! and history repeats itself, only maybe this time it will be Fonda Lyin singing?

Posted by: Stonebird | Apr 1 2022 18:13 utc | 51

The simple answer is that the US has "kompromat on all the EU leaders, every one of them. Remember them bugging Merkel`s phone for ages. Plus the lure of what can be realised for each of them once Russia is totally barstardised is a mighty tempting incentive.

Posted by: DaVinci | Apr 1 2022 18:15 utc | 52

Posted by: A.L. | Apr 1 2022 17:40 utc | 32

Thank you for your comments concerning the European Union’s abeyance of the freedom and independence it once believed in and upon it was originally founded. What we are increasingly witnessing at this time, is the utter submission of European self-determinism to the dictates of the United States and Britain. Neither of those countries are members of the European Union, but ironically, as members of NATO, both are currently dictating the foreign, economic, and energy-related policies of the EU as if they owned it.

What we are experiencing here in Europe at this time are the effects of the “diktat” of a supposedly “defensive” military alliance, namely NATO, instead of clearly defined and structured European policies for the areas described above, based upon their own decisions. Thus, military structures are imposing their own policies upon civilian governments. Instead of following orders, these collective militaries are now giving the orders in Europe.
Europe has effectively become a military dictatorship. One can attempt to paint a different lipstick on that pig, but it isn’t going to change things much.

What Europe, the cradle of so many cultures, languages and so much incredible depth has now been reduced to is an utter disgrace.

In the long run, because that is what these things always come down to, you can be sure that the “actors” directly responsible this tragedy will severely pay.

Europe will not forget, and it will never forgive.

That point has now been passed.

Posted by: GreyRaven | Apr 1 2022 18:16 utc | 53

Posted by: WJ | Apr 1 2022 17:59 utc | 41

Gazprombank was already exempted from sanctions, on Germany's insistence. How do these new measures prevent any new sanctions from being placed on Gazprombank? Supposedly by the fact that if the West sanctions that bank, isolating it from the Western banking system, no more euros can flow into it as payment for natural gas. But that was already the situation before this: The reason Gazprombank, and a few others like Sberbank, were singled off not to be sanctioned, was precisely because they were the conduits for euro and dollar payments for energy in the first place.

The more fundamental (hypothetical) reason, both then and now, is of course that if the West were to introduce new sanctions that shut off payment flows, Russia would simply shut off the gas in response. But the West already stole 300 billion dollars (in historical oil and gas revenues) from Russia, and still demands that Russia keep delivering new gas. Russia (so far) dutifully keeps delivering. If the West can steal 300 billion from Russia, apparently convinced that gas needed by Europe will continue to flow (and be proven right), what makes you think they will be deterred from blocking any future, and much smaller payment flows by sanctioning Gazprombank?

Posted by: Unnamed | Apr 1 2022 18:16 utc | 54

maybe Dag Hammarskjöld was in a sense the first Color Revolution. Considerable speculation that the US or UK or both had him murdered. can't have an independent minded UN Secretary General, just not acceptable old chap.

Posted by: pretzelattack | Apr 1 2022 18:20 utc | 55

Hungarian PM Viktor Orban tells it like it is.

"Hungarian Prime Minister Viktor Orban said, on Friday, that there are countries which will not be able to substitute Russian gas with the more expensive American alternative.

Speaking to local radio station Kossuth, ahead of this weekend's parliamentary election, Orban said Russian gas is his country’s only option, as Hungary is landlocked and won’t be able to directly receive liquified gas from the US.

He added that it’s impossible for Hungary to “turn off cheap Russian gas and buy expensive American energy instead,” adding that it is not viable for Europe to count on the transportation of sufficient volumes of liquified gas from the US across the ocean, and that there is no alternative to Russian supplies in the near future, for Hungary in particular.

“It’s not about putting on a sweater at night, or turning down the heating a little or paying a bit more for gas, it’s about the fact that if there is no energy coming from Russia, Hungary will be left with no energy at all"

Posted by: Republicofscotland | Apr 1 2022 18:20 utc | 56

Arne Hartmann | Apr 1 2022 18:11 utc | 49

Of course, thanks for pointing this out. So any NEW contracts will be denominated entirely in Roubles from the start.

Posted by: Stonebird | Apr 1 2022 18:22 utc | 57

Posted by: Arne Hartmann | Apr 1 2022 18:11 utc | 49

Very interesting. Moving past the existing contracts, one way or the other, is the only way forward, and that is why this is good news. There need to be new contracts which demand payment in rubles from the get-go, the key being that Russia can then set the terms for how unfriendly nations may acquire those rubles (euros and dollars should not be accepted in exchange).

The reasoning, which I have seen in some places, that Western buyers are happy for an opportunity to renegotiate or "escape" their existing contracts with Gazprom, makes absolutely no sense, since spot prices are about 10 times higher now than a year ago (and for a while they were about 25-30 times higher). There can therefore be no way that new or renegotiated contracts would be to the advantage of European buyers still in need of future Russian gas deliveries.

Do you have more details on this from anywhere? (German-language sources are more than welcome for me.)

Posted by: Unnamed | Apr 1 2022 18:24 utc | 58

pretzelattack (55).

Then there was the murder of Brent Carlsson, (possibly by South African agents) and the USA's removal of UNSG, Boutros Boutros-Ghali, of whom the late Madeline Albright called Frenchie, Boutros-Ghali was ousted in 1996 and replaced with Kofi Annan.

Posted by: Republicofscotland | Apr 1 2022 18:25 utc | 59

Posted by: Republicofscotland | Apr 1 2022 18:25 utc | 59
more recently, John Bolton threatened the children of the first head of the OPCW when he didn't cooperate, the guy resigned. "we know where your children are". and this scumbag is still on US TV pushing war. no consequences, only rewards.

Posted by: pretzelattack | Apr 1 2022 18:30 utc | 60

Posted by: Unnamed | Apr 1 2022 18:24 utc | 58

From Yves article, an explanation:

– LNG is excluded, we are only talking about “pipeline gas”.

– Gazprom is directly prohibited from shipping gas unless it is paid in rubles.

– To facilitate this, a) Gazprom Bank will open an account in rubles, and a parallel account in foreign currency (termed “K-accounts”, likely for some legal reasons); b) there is a section detailing how these accounts are opened by Gazprom without the “foreign owner” actually participating in the process, basically to get around anti-laundering laws.

– Customer will deposit euros (let’s say) with Gazprom Bank into “their” euro K-account, and instruct Gazprom to procure X rubles to make the payment for the gas. Gazprom Bank will sell the euros on the Moscow exchange, and credit the rubles thus received to the customer’s ruble K-account, and then pay Gazprom for the gas delivery from that ruble account.

– The Russian Central Bank is directed to establish all the necessary procedures viz. these K-accounts, then the Customs Service is supposed to confirm the procedures for release of the gas, both “within 10 days” of the decree’s effective date (March 31). The Central Bank also gets leeway to develop “alternative FX trading mechanisms”.

– There is a government official (from the Foreign Investments Commission) empowered to grant waivers to foreign customers, seemingly at will.

A second fine point is that this process has the gas buyer “owning” the rouble account as well as the initial euro/dollar/sterling account into which the contractually due payment is initially made. So the gas buyer does in the end make payment in roubles because roubles go from his rouble account to Gazprom.

Posted by: Boo | Apr 1 2022 18:33 utc | 61

@Posted by: Republicofscotland | Apr 1 2022 18:12 utc | 50

De Gaulle pulled France out of the NATO integrated command structure in 1967, but France remained a member of NATO.

Posted by: Roger | Apr 1 2022 18:34 utc | 62

All this reminds me of the Dylan song "Franky Lee and Judas Priest" Regard Yourselves the paralel to Russian (Judas Priest) and Frankie Lie (North America):
"Well Frankie Lie and Judas Priest/ They were the very best friends(
So when Frankie needed money one day/Judas pulled out a string of tens,
Saying "Frankie Boy, Your loose shall be my gain!!"
Well; Franly Lee he stumbled .. he soon lost all control
/Üntil he came unto that place /whence Júdas Priest had strolled
/But where even Judas Priest would stall. "

and so on:

Now even the billionars in Russia have understood quite dim-vittedly tha th US of Judas Priest have had the gun pointed against them all the time from their even beginning -- no matter whether they be Khazakhstani or from The Ukrainie land of (some rich) Jews from their very start or not!

Posted by: Tollef Ås/秋涛乐/טלפ וש | Apr 1 2022 18:35 utc | 63

Likklemore @13--

I was going to include that article along with this one in my comment but will now only look at the one I linked. "Chickens Have Come Home to Roost: Why Biden's SPR Release Unlikely to Curb Oil Prices" is written by Ekaterina Blinova who writes in her first paragraph:

"Earlier, the US president imposed an oil embargo on Russia..."

Which we know isn't true. The writer seems more interested in exploring Biden's political issues versus properly examining her headline topic. There's some curious info on the massive decline in fracking which is being covered up since its geology that doing the restricting as those in the know knew would occur. Then we have the following dilemma: Is Biden supporting Big Oil or against it? Hudson looks at the actual polices being implemented and says he's Pro Big Oil, while other writers only listen to Biden's environmental rhetoric and say he's Green and Anti Big Oil. The truth seems to be that Biden's being crushed by the reality that the Outlaw US Empire can't supply its needs from domestic extraction alone. This Wiki tidbit on the SPR is informative:

"The current inventory is displayed on the SPR's website.[2] As of December 4, 2021, the inventory was 593.6 million barrels (94,370,000 m3). This equates to about 29 days of oil at 2019 daily U.S. consumption levels of 20.54 million barrels per day (3,266,000 m3/d)[3] or 60 days of oil at 2019 daily U.S. import levels of 9.141 million barrels per day (1,453,300 m3/d).[4] However, the maximum total withdrawal capability from the SPR is only 4.4 million barrels per day (700,000 m3/d), so it would take about 145 days to use the entire inventory. At recent market prices ($58 a barrel as of March 2021),[5] the SPR holds over $14.6 billion in sweet crude and approximately $18.3 billion in sour crude (assuming a $15/barrel discount for sulfur content). In 2012, the total value of the crude in the SPR was approximately $43.5 billion, while the price paid for the oil was $20.1 billion (an average of $28.42 per barrel)."

Looks like the sour/sweet ratio is about 3/2:

Bryan Mound - holds 218.2 MMB in 20 caverns - 66.6 MMB sweet and 148.8 MMB sour. •Big Hill - holds 129.9 MMB in 14 caverns - 65 MMB sweet and 65.1 MMB sour. •West Hackberry - holds 180 MMB in 22 caverns - 102.2 MMB sweet and 77.5 MMB sour. •Bayou Choctaw - holds 60.1 MMB in 5 caverns - 18.9 MMB sweet and 41.9 MMB sour.

That's 251.7 sweet and 333.3 sour. It's all stored in Texas and Louisiana and would thus be processed by that region's refineries and pumped into the local distribution network which is already the lowest priced region for fuels and thus provide no relief for the high priced West Coast and Northeast. So, releasing the SPR is a political loser as it will have negligible impact.

Meanwhile, has anyone read anything about the Outlaw US Empire soon having to pay for its Russian oil and product imports in BigLie Media?

Posted by: karlof1 | Apr 1 2022 18:38 utc | 64

at #48.

Far from the first, depending on the definition of "color revolution." William Bloom, among many others, has posted a starter list.

It has to be considered incomplete, since I don't see any mention of CIA involvement in the Renault strikes of 1947, the Italian election of 1948, the first attempt against Syria in 1948, the early '50s Datsun strikes, and on and on, just at the immediate post-wwii side of the list.

The ongoing chronical of U.S. acts of war against foreign countries isn't a bug, it's a feature.

Posted by: FioriMusicali | Apr 1 2022 18:39 utc | 65

Posted by: Boo | Apr 1 2022 18:33 utc | 61

I have read that entire post and others by her, and they offer no explanation as to how Russian entities will escape the continued accumulation of Euro-denominated financial assets. What is described in the text you quoted are just new, convoluted ways for Russian banks to account for euro deposits in their name, which will have to be in correspondent accounts in European banks.

The exact same conundrum - that they are stuck with euro deposits as a "hot potato" - remains. As I have explained, there is no way for a Russian bank to receive euros in a way that is outside the purview of the EU (and therefore outside the reach of sanctions, or even other restrictions on how the euros may be spent). The Euro zone banking system, just like the US banking system, by the very nature of how banking works, is a closed system (aside from the "escape hatch" of withdrawn banknotes). Yves Smith should understand that better than anyone but for some reason keeps evading this issue, and is hostile to everyone in the comments who points it out.

Posted by: Unnamed | Apr 1 2022 18:40 utc | 66

An important aspect of the gas for rubles setup is that the EUR will be converted to RUB using the moscow exchange.

Traders on the moscow exchange would not be the Russian central bank, rather would be private parties. So the EUR ends up in some private party possession. What is the risk to Russia? None.

What will happen is that trillions of RUB will be purchased on the open market, which will boost its price above the 5000 RUB per gram of gold equivalent. That puts a ceiling price for the RUB that will be arbitraged against and that will create a buy pressure for gold.

RUB will oscillate around whatever gold peg price is set as there will be such an imbalance of buy pressure vs. sell pressure for the RUB it would just go arbitrarily high if the gold conversion price ceiling was not there.

Practically speaking, it does peg the RUB to 1/5000th gram of gold, but without any obligation of having to redeem RUB for gold.

So not only will the RUB end up at whatever price against the USD that Russia wants, the paper gold market will also be blown up.

Posted by: ct | Apr 1 2022 18:44 utc | 67

In the online Foreign Policy Review discussion Scott Ritter stated something very important that most people here have been underestimating for years now.: Biden is the best gift the Russian economy could have ever asked for. Absolutely!

I always believed that China and Russia could not reach their apex until they were weaned off the global reserve currency; the U.S. Dollar. Yes, I know they were kicking strategies around, but never kicking the habit with the necessary conviction it takes.

The U.S.$ is Crack, better yet, Smack, and everyone's a Junkie. So an existential crisis was necessary, because Trump was the ultimate Dealer ensuring dependency. Trump was all about sustaining U.S. supremacy. China got lucky with Biden, but her luck will run out eventually without Russia's help tomorrow. India will not rescue anyone, especially China, but it can be nudged away from U.S. influence towards neutrality when needed.

Russia was destined for this moment. This is Russia's vindication for the plunder it suffered with the Fall of the Soviet Union and President Putin is precisely the right Leader to exploit the potential that the present is screaming to promote. Putin totally absorbed Russia's history and is working the raw material into a 21st Century constitutional breakthrough for Russia that cements her rightful place in the world. Everything is coalescing: Novorossiya, multipolarity...destiny. Putin and Xi are very aligned in regards to the future of their respective countries whether they have yet to recognize this instinctual alignment fully. These current events are an opportunity for both that needs to be embraced with trust, because they represent a seismic change mutually beneficial; beneficial for all. However, departure from U.S. reserve currency dependence is requisite.

Xi is in a critical position in regards to shaping the future and he must have the courage and vision this opportunity presents. He must borrow Putin's conviction.

On that note and to promote wisdom, I want to throw China's words to the EU back in her corner: the EU CHINA must take control of its own destiny...if it wants to lead the way. Quit the U.S. reserve currency crack dependency!

I'll end with Lavrov's prescient warning in India:

We don’t want to depend on a system whose masters could steal your money overnight.

China, your move. The Dealer is coming for you next as you are the biggest threat to his trade. It's time to act while Biden is still President and Putin is risking everything.

(@20 Unnamed

That can only be done if they are allowed by the EU to spend those euros on imported goods and services, or to exchange them to the currency of a friendly third party like the Chinese yuan.

China needs to practice what it's preaching to the EU and play its Ace.

Again @40 Unnamed

Trumpian 4D Chess is what Trump will be playing after the indictments start raining down on him, and deSantis will be secretly whispering: check mate after playing Trump and his dwindling followers like a Stradivarius.

It's not 4D Chess when you play a hegemonically-rigged game. Take away the trappings of the Empire and the remains are: a clown peddling a brand.

Posted by: Circe | Apr 1 2022 18:46 utc | 68

Are we honest enough to ourselves to admit the "siege of Kiew" was a debacle?
What happened to the 60Km convoy north of Kiew, except offering easy targets for Ukrainian drones, artillery and ATGM attack teams?
What did that "feint" achieve, now that Russia is seemingly not even able to defend the Kherson area?

Russia better fortify the gains in the East and South East and make sure it destroys enough Ukraine military assets before the war is over and mission all but accomplished.

Posted by: Kerkaraje | Apr 1 2022 18:48 utc | 69

@Paul Greenwood (35)

Make that Nietsche.

Posted by: bjd | Apr 1 2022 17:51 utc | 39

Unless you're referring the the Ukrainian painter, who was still a tyro when Diesel died, it is indeed Nietzsche.

Posted by: malenkov | Apr 1 2022 18:48 utc | 70

@Paul Greenwood (35)

Make that Nietsche.

Posted by: bjd | Apr 1 2022 17:51 utc | 39

Unless you're referring the the Ukrainian painter, who was still a tyro when Diesel died, it is indeed Nietzsche.

Posted by: malenkov | April 01, 2022 at 18:48

Oh, I get it! You were snark-canceling the "z" . . . sorry I'm a bit slow today. :-)

Posted by: malenkov | Apr 1 2022 18:49 utc | 71

@ Sternberg | Apr 1 2022 18:08 utc | 47 with the cogent description of the Payment situation

You wrote
the third aspect is that according to the scheme demanded by VVP the EUR amounts after arriving at a bank in russia need to exchanged to rubles thereat, such that final payment to the gas supplier is done in rubles. this of course stabilizes the ruble exchange rate, while at the same time keeping the EUR amount within the russian banking system.

not sure which of those three is most relevant but i would guess the first one.

I repeated your third aspect because I see it as the most important in the long run and there is a nuance to that I am not sure of. The nuance is whether the price paid is in Roubles or EU and if Roubles then is the buyer on the hook for using enough EU to get the right amount of Roubles?

This would make sense to me because of the manipulation of fiat money in the private controlled foreign exchange markets being now set off against a Petro/Gold/Rouble that is not fiat but has intrinsic value.

And the holding off of having a Reserve Currency created that has intrinsic value is the war we are seeing here because it is a fiat US dollar killer.

Posted by: psychohistorian | Apr 1 2022 18:51 utc | 72

Are we honest enough to ourselves to admit the "siege of Kiew" was a debacle? What happened to the 60Km convoy north of Kiew, except offering easy targets for Ukrainian drones, artillery and ATGM attack teams? What did that "feint" achieve, now that Russia is seemingly not even able to defend the Kherson area?

Russia better fortify the gains in the East and South East and make sure it destroys enough Ukraine military assets before the war is over and mission all but accomplished.

Posted by: Kerkaraje | Apr 1 2022 18:48 utc | 69

1. There was no "siege."
2. There was no 60 km convoy. The western presstitutes called it a (merely) 40 km convoy, while it was actually a 4 km convoy 40 km away.

All in all, your concern is duly noted.
3. That convoy was never attacked.

Posted by: malenkov | Apr 1 2022 18:52 utc | 73

Posted by: Kerkaraje | Apr 1 2022 18:48 utc | 69

Siege of Kiev? What are you smoking bro? Some MSM garbage, it looks like. When did the Russians claim a siege is happening?

And when was that convoy attacked? Have you got any proof besides the claims of the ukro-orks?

Posted by: Boo | Apr 1 2022 18:57 utc | 74

Is the "Gas for Rubles" gag a total nothing burger???

Wasn't it a sort if testing of a Nuclear Option of a complete halt of all Russian energy to Western Europe?

One might expect the voters of Western Europe to vote out the Yid puppets controlling their Government, BUT THE ELECTIONS ARE RIGGED primarily by restricting the choices (Ron Paul won the first 5 primary votes, and Berney Sanders won over Biden, but voters were restricted and not allowed to have those choices on the ballot) so do not expect LaPen to be allowed to win in France and pull a Charles DeGall pulling France out of both NATO but also pulling France out of Africa and the Middle East.

Posted by: Carl | Apr 1 2022 18:57 utc | 75


My understanding is that the amount of EUR needed will be whatever the purchase contract was at. The exact amount of RUB that the EUR becomes will vary based on the exchange rate.

Regardless of whether the rate is pushing through that many conversions will simply overwhelm the available supply unless the Russian central bank is nice enough to issue more RUB to sell.

When a finite market gets hit with a massive demand, the price goes way up. At first I wondered why a 5000 RUB for gram of gold price ceiling was put in place. The reason is so that the much larger liquidity of the gold market will be sucked into the EUR/RUB market.

The solution is absolutely brilliant on so many levels

Posted by: ct | Apr 1 2022 18:57 utc | 76


Nothing burger?

Only if being able to set the RUB price to whatever level is wanted, while letting the private sector provide the liquidity and deal with the risk of holding EUR is a nothing burger.

Posted by: ct | Apr 1 2022 19:02 utc | 77


unfortunately the slaves of Europe love their chains of servitude to the US.
I expect them to change only under the severe consequences of dire necessity

Intel Slava Z
🇩🇪🇷🇺 The CEO of the world's largest German chemical concern BASF, Martin Brudermüller, strongly opposed the imposition of an embargo on energy supplies from Russia, stressing that this could lead Germany to the most serious crisis since the end of World War II.
91.9K views Apr 1 at 02:43

Posted by: michaelj72 | Apr 1 2022 19:05 utc | 78

Roger (62).

Yes Roger that is correct, politically France still remained in Nato, it says so very clearly in the link I posted.

Posted by: Republicofscotland | Apr 1 2022 19:06 utc | 79

I see some of people here spinning how rubles for gas is some kind of fake story and nothing is changed, and Russians folded again.


Check ruble exchange rate while you're at it. It's back to where it was before all this started.

Posted by: Abe | Apr 1 2022 19:06 utc | 80

I see the payment scheme/arrangement more as a goodwill offering. Yes, Russia wants to have better control over financial assets to which it is party to (why pushing rubles as a trading currency makes sense), and much has to do with severing the US's influence over contracts to which the US is not a party to/of. This forces European nations to step forward and be responsible for themselves: how can Germany allow the US to dictate whether NS2 becomes operational or not? (as is obvious, Germany is a vassal state of the US)

NOTE: would Russia be OK with not doing this currency shuffle? (this is, as I note below, all about market share- Russia still trying to show it can make a better deal than the US [not hard to do]) I would think so, but only IF the other parties were able to uphold their end of the deal. This semi-kludge of a direct currency swap(?) will effectively give an extra lever to enforcing deals.

Can a country using Euros pull their end of the trade (anyone familiar with US cartoons can think of that cartoon "Top Cat")? I suppose so. BUT! That would then be a clear violation of the contract, a violation in which there could be no hiding who is at fault; POOF! the gas valves turn off.

Is this a battle for market share (between the US and Russia)? You bet. Who has the better hand? (<- rhetorical question)

Having said all that, could someone clarify/answer whether SWIFT is still involved here? That is, can these transactions still occur outside of SWIFT? (if not then Russia needs to provide clients with such facilities)

Posted by: Seer | Apr 1 2022 19:06 utc | 81

Posted by: GreyRaven | Apr 1 2022 18:16 utc | 53

Thanks for your comment. I do feel your pain, more than you know.

I don't want to see europe kneeling in front of china or anybody, nor i think that's Russia's wish either. I believe Europe would be respected the moment it demonstrate some agency and run their own foreign policy.

That goes with the US' chief cheerleading basement gimp, Australia, as well.

I have spent the best part of my life living in all these places and i love the people and their culture. Whilst i do not wish ill upon their people, it seems the leadership is determined go all in. They will get schooled, and as usual the people will be paying the price. The last song of the fat lady.

I think the EU experiment has run its course, it is clear as day that it is not serving the people they claim to represent, not that they were elected to start with...

For too long the EU was used as a "civilian", economic NATO of sorts, to encroach upon russia. While they were able to tick off country after country to satisfy the politician's hubris they also brought on a bunch of non-contributor states. Those are also the most vocal belligerents, running under the skirt of mother EU everytime they overstep their mark.

It's high time they actually start working for their people and reflect their desires. They should have listened to CDG on NATO.

Do not forgive and never forget.

EU will fracture, NATO will die, and I'll see you on the other side.

Posted by: A.L. | Apr 1 2022 19:06 utc | 82

Re the euro ruble exchange. All foreign payments from Russia are now in rubles. Aircraft leasing ect ect. Those foreign companies can then exchange their rubles for euro's.
Still the problem of trade surplus though. I see Russia intends dealing with friendly nations in their own currencies so I guess a reserve of many different currencies plus gold, with the ruble pegged to gold? I think june or july Russia will review the ruble to gold thing. Perhaps they will drop it or perhaps ...? What I have been reading, Russia will be pushing the value of gold up.
Central banks don't put wheat silos or oil tanks in their vaults. Gold has been a commodity international currency throughout history. US tried to replace it with worthless paper and promissory notes backed by faith.

Posted by: Peter AU1 | Apr 1 2022 19:09 utc | 83

Posted by: ct | Apr 1 2022 18:44 utc | 67

What private parties will there be though, outside of Russia, with enough rubles to offer (how did they acquire them?) in exchange for euros? The ruble is held to a very small extent outside Russia.

It is not at all without risk to Russia that "private parties" end up with the euros, vulnerable to sanctions, as long as those private parties aren't foreigners. That is literally saying it's fine to load up Russian households and industries with assets that will become worthless to them, "no skin off our back".

There is very little gained by just moving this vulnerability around inside Russia and that is, again, why Europeans are saying they are perfectly fine with this so-called "new" arrangement, and that they were worried over nothing.

I agree fully with the part about gold though. At first the chosen bid price at 5000 RUB/gram (actually under the current market price in rubles) seemed strange to me, but with a rapidly (through other mechanisms operating in parallell, I guess) strengthening ruble, the gold price in ruble terms decreases toward that set floor (in ruble terms), and we eventually enter the dynamic you describe. The West would be forced to (as far as I can figure) accept either a revaluation of gold (in their own currencies) on Russia's terms or a permanent arbitrage which would result in a constant flow of gold (beyond what might already be taking place behind the scenes) to Russia. Either case could possibly break the paper gold market (bringing down the City of London, New York and Chicago) just as you point out.

Posted by: Unnamed | Apr 1 2022 19:10 utc | 84

China should tell the EU that from July 1 on, it will no longer accept dollars, euros and pounds (except existing contracts), and that Swift will also be abandoned and an alternative platform has to be used.

Since all sanctions on Russia are illegal (only UN sanctions are legal), the EU is seriously trying to convince China to break international law. That's funny for people that run around promoting a rules-based system.

This is a great opportunity for the Global South to cripple the West because the Global South has most natural resources, without which the West is doomed. The Global South should form an economic, political and military bloc and act like Nato: any attack including sanctions against any member will lead to a response from all Global South countries against that country.

Posted by: Nico | Apr 1 2022 19:11 utc | 85

"...when will europe recognize how this works and stop being manipulated??...." james @3

It is very simple. And the fact that it hasn't occurred tells us something very sinister about both European and, to a lesser extent, US society.

The central reality in all our lives is that the Permanent Arms economy, with its concomitant permanent security/secret police state, lowers living standards everywhere in a dramatic fashion.
There are good and easily made arguments for our states to enter into security guarantees which will save us the costs of disfiguring our societies by endlessly preparing for war.

After 1945 most of Europe was eager for peace with the Soviet Union, the great majority of the electorates of France, Italy, Scandinavia, Greece, Yugoslavia and the United Kingdom not only wanted but expected peace and a new era of development in which Unemployment and Depression, poverty, disease, inequality, injustice and profiteering be put behind them. And the enormous problems caused by colonialism and imperialism, everyone saw was outmoded and immoral would also be tackled.
That was what common people the world over expected from the United Nations.

What happened instead, and almost entirely because of the United States' ruling class, was the Cold War, which took the form of dozens of hot wars- almost every country in the Far East from Malaya and Indonesia, to Indo-China, Korea, the Philippines and China itself were embroiled in wars in which the former colonial powers-invariably at the behest of the US, which dominated the economy- sought to preserve imperial rule, either directly or through neo-colonialist regimes.
This vast complex of conflicts, almost all of which was given a racial (Divide and Conquer) veneer whilst in reality being naked class war to prevent popular power, spread throughout the entire world. It tore apart swathes of South America, it was the history of Africa for decades and it was the central fact in every region of the world.

In the metropole, north America, Europe and the 'lucky' outposts of imperialism like Australia and New Zealand the war took a different form- that of McCarthyism. A long series of assaults on working class institutions, the expulsion of communists and other radical activists from the Trade Unions and the transformation of the socialist mass parties, which in terms of numbers and organisation were the most powerful political forces everywhere except in north America, although they were very powerful in Canada and locally in industrial US states too.

So much for the history and the tragic proof of historian GDH Cole's warning that the greatest threat to Europe's future welfare lay not in the possibility of Communist power but in the danger of US dominance. A domination that has only reached its full flowering today in the neo-liberal politics of privatisation, of castrated Unions and Judicial systems that are utterly biassed- vicious attack dogs at the foot of tyranny's throne.

It has been in the last few years that the tomb of european freedom has been sealed.
Because, despite decades of set backs and defeats a genuine left had survived in the form of powerful factions within the political world. In Italy a country virtually occupied by the US, working together with the old fascist base, the state institutions and the Roman Catholic church, the Communist Party, marxist socialists and the Trade Unions preserved the possibility of winning electoral office at any time. In fact it took considerable plotting, much illegality, including assassinations, false flag terror attacks and kidnappings- together with the expenditure of billions of dollars- to prevent the left from progressing electorally towards power. In France, where the emergence of a Gaullist nationalist tradition which regarded the arrogant successors of the government that Louis XVI had empowered with contempt and enmity, resistance to the New Empire was even stronger. And more successful.

And then there was the UK. And here we have seen, are watching, the endgame: so long as Corbyn was leader of the Labour Party, there was a real chance (it would not have been easy but it was well within the bounds of political possibility) that a socialist government would take the few bold steps that are needed to divorce the Empire and to join with Eurasia and the growing web of 'rogue' states, such as Iran and Venezuela, Syria, Lebanon in commercial and diplomatic alliances.

The de-fenestration of Corbyn involved the open alliance of Finance, the enormously powerful and deeply rooted Security Services, the United States and the media/academy on the ludicrous pretext that he was anti-semitic (this is a man whose parents met at the famous battle of Cable Street!).
It is an indication of the contempt with which the populace is viewed by Britain's arrogant and thoroughly unpatriotic Establishment that this ruthless operation was carried out so transparently. It was a demonstration of sheer power: "Killing the chicken to frighten the monkeys."

Elsewhere in recent years and days we have seen the rise and swift collapse of Syriza in Greece, of Podemos in Spain, of Die Linke in Germany (Oskar Lafontaine recently resigned) and similar 'defeats.'

But the simplicity and clear appeal of a political programme in which the people of Europe are given a choice between NATO, subservience to the US and plummeting living standards and, on the other hand, peace, prosperity and membership of an international community ready and able to deal with the great problems of our era- the rapid deterioration of the natural environment and the real prospect of billions dying in successive disasters.

The surprising thing is that the forces of Empire and reaction, of greed and social anarchy, the 1%, are still in control. And it is taking so long for the people to choose an alternative to their certain suicide.

But perhaps all is now changed with the apparent splitting of the world into two parts, of the sort that Brecht would have recognised: the United States is an old syphilitic roue, rotting away in luxury and surrounded by successive generations of whores, painted, overfed, dripping diamonds and furs, permanently drunk and living in an atmosphere stinking of opiates, a hypodermic syringe is ready in the hands of a provocatively uniformed nurse (who bears a distinct resemblance to Tony Blinken in drag) and the crumbling palace in which they are is surrounded by puzzled, even angry looking people holding their ears to muddle the loud sounds of bad music and cheap rhetoric, extravagant falsehoods and obvious lies blaring out from banks of loudspeakers in sound trucks, low flying aircraft and fixed on posts.
Sadly, these crowds have to pick their way gingerly over thousands of corpses, the fruit of an epidemic nobody can agree to pay for treating.

Posted by: bevin | Apr 1 2022 19:11 utc | 86

Posted by: Unnamed | Apr 1 2022 17:53 utc | 40

I understand the part that refers to what has been until now. - But if now a European gas customer first has to move the price amount in Euros to, let us assume, Gasprombank in Russia this money has left his European bank, has arrived in Russia at Gasprombank which will turn it into rubles and then pay it to Gasprom Russia. Then, and not before, the gas is supplied. I cannot get how then the old game of freezing this Euro amount in any Eu-country can work. The money is no longer there. And if it works like that Russia would have achieved its goal to sell gas only against rubles to be paid out in Russia.
Forgive me, I am a layman. I do not like money unless I need it. ;-)

Posted by: Hausmeister | Apr 1 2022 19:11 utc | 87

pretzelattack (60).

Ah yes Mad Dog Bolton, who said...well check them out for yourself.

Posted by: Republicofscotland | Apr 1 2022 19:12 utc | 88

It should be added that the bid price can of course always be changed to a higher amount than 5000 RUB/gram, further increasing the pressure on the West (as it struggles to suppress the price of gold).

Posted by: Unnamed | Apr 1 2022 19:12 utc | 89


Gazprom bank is exempt from SWIFT sanctions.

EUR is sent using SWIFT to the now unsanctionable Gazprom bank.
It then uses the moscow exchange to swap it into EUR in the open market.

Open market purchase. THAT is the key aspect as it will create trillions of RUB of demand and a big price increase to RUB. Just look at what happened before any of this has even started.

Posted by: ct | Apr 1 2022 19:13 utc | 90

Escobar strikes again.

"As Scholz was still trying to understand the obvious, his economic minions went berserk, floating the idea of nationalizing Gazprom’s subsidiaries – Gazprom Germania and Wingas – in case Russia decides to halt the gas flow.

This is ridiculous. It’s as if Berlin functionaries believe that Gazprom subsidiaries produce natural gas in centrally heated offices across Germany."

Posted by: Peter AU1 | Apr 1 2022 19:18 utc | 91

Posted by: A.L. | Apr 1 2022 19:06 utc | 82


Posted by: Boo | Apr 1 2022 19:18 utc | 92


I would expect that at scale, it will be the gold arbitrageurs who will end up with the EUR.

They sell their gold at 5000 RUB per gram. They now have RUB. They then sell the RUB on moscow exchange for EUR.

Maybe they even start with EUR and buy gold for EUR outside of Russia to begin with. Not clear on if the 5000 RUB offer is only of Russian miners, or only the actual Russian mined gold.

Posted by: ct | Apr 1 2022 19:18 utc | 93

Posted by: ct | Apr 1 2022 19:18 utc | 93

This is a very interesting possibility. I have to add though that it still requires the cooperation of the West, i.e. they must sit idly by while for example Chinese banks on a constant basis buy the euros from Russia in exchange for rubles (on the Moscow Exchange), use the euros to buy gold and then buy back rubles from Russia in exchange for the gold. (On a net basis this would of course simply be Russia buying gold for gas, and making Europe pay for the gold, while China pockets all the various arbitrage gains.)

This is incidentally more or less a scenario that I've dreamt about for years. And hopefully (and maybe I've just become too jaded), if the West were to interrupt this scheme (by halting the flow of euros, or pressuring the Chinese to stop buying gold for the euros), that would be when the flow of gas from Russia would also stop.

Posted by: Unnamed | Apr 1 2022 19:27 utc | 94

Lavrov's presser today in India was rather lively. The following was the most important Q and got the most detailed A:

Question: For several weeks now, we have been receiving reports from all over the world that Russophobic sentiments are sweeping entire regions. People suffer from what is called the "Middle Ages", from what they are not guilty of. How is the Foreign Ministry responding to this? Maybe unified information collection centres and assistance centres will be formed? What will happen next in this area and what else needs to be done?

Sergey Lavrov: We have commented on the situation more than once. It really resembles the Middle Ages, a real Russophobic sabbath. It is as if all the previous decades the West had disguised itself as a polite, well-mannered partner in the international arena. In fact, behind such an outwardly decent mask was his true face. It has now manifested itself on a scale that no one could even think of. Everything Russian is ostracized and banned.

We have established work to register all cases of this kind. We use the tools that exist in our state system, the resources of the Investigative Committee, the Prosecutor General's Office and other departments.

The Foundation for Support and Protection of the Rights of Compatriots Living Abroad is actively involved. He has long been working in dozens of countries and helps to organize legal assistance to compatriots who find themselves in a difficult situation.

The current history calls for a global effort at the level of international organizations. They should stress the inadmissibility of such "actions" on the part of our Western partners. There is discrimination, trampled all the "values" that the West "boasted" of for many years (the presumption of innocence, the inviolability of property, the rules of the free market, etc.). I am not even talking about what is being done to religion and the Russian Orthodox Church not only in Ukraine, but also in the EU countries that consider themselves "civilized". This conversation is "overdue." Everything that is happening directly undermines the obligations of the organizers of these "actions" under the UN Charter and the OSCE. Without this conversation, we will not be able to overcome the state into which the West "drives" not only relations with Russia, but also international ones. It's a signal to all of us.

Over the past couple of years, the United States has finally stopped all attempts by Europe to strive for a kind of independence, strategic autonomy. Single voices, coming in particular from France, no longer solve anything. Germany has fully accepted the fact that it is an ally of the United States, blindly following in the American "rut". Everything is being done to recreate a unipolar world and proclaim this process "the struggle of democracies with autocracies." What kind of democracy is this? In this state, led by Washington, they themselves, collectively, have become an autocracy on the international stage. They profess permissiveness for themselves.

If the United States thinks that somewhere (as it was in Iraq, Libya, Syria, thousands of kilometers from their shores) "suddenly" there are some "threats" (as a rule, they then turn out to be fakes or based on false evidence), Washington "has the right" to do what it wants: to kill hundreds of thousands of civilians, to compare cities with the ground (for example, the city of Raqqa in Syria). This mentality will permeate further Western activity in all regions if left unchecked.

If someone else, not only Russia, sees a direct threat embodied in weapons, military-biological programs (as it now turns out), the creation of foreign military bases on the territory of a neighboring state (in this case, right on the borders with our country), the West considers this unacceptable. As well as the fact that Russia is beginning to defend its own interests. This is much deeper and broader than just a special military operation in Ukraine, ensuring its neutrality under collectively accepted security guarantees. This is a question of the world order, in which all the norms of decency, international law and its own "values" (the West introduced them in the context of its model of globalization) were trampled upon by the West itself.

There's no getting away from this conversation. Its necessity is understood in China, India and other countries. I read the speech of the Minister of External Affairs of India S. Jaishankar at yesterday's event dedicated to Indian-British cooperation. He noted that the issues that have arisen in international affairs affect the essence of the world order, which must undergo changes, become equal, multipolar, without any sovereigns and dictators. [My Emphasis]

IMO, the West will refuse to have the required conversation although its presence is required. There's only one way to ensure they come and sit at the table and that's to force them by first bifurcating the international financial system in a manner that renders their currencies worthless when attempting to trade with the vast majority of the world. Clearly, it's the only language the West comprehends. Of course, there are several Western nations that are captives--Hungary, Austria, Serbia, Greece, and Finland spring to mind. IMO, the best thing they can do is to break NATO and EU by joining the conversation.

Posted by: karlof1 | Apr 1 2022 19:27 utc | 95


Even if the 5000 RUB offer is only to russian refined gold, seems it would just be a matter to melt gold down and recast it as russian gold to be able to do the arbitrage.

Where there is free money to be made without risk, people always figure out how to do it. So when the RUB price on the open market goes below the 5000 RUB for a gram of gold, the arbitraging will start. At 4999 it would not be enough profit, at 4990 also not enough, but at 4750 there should be enough margin to deal with the transport and logistics.

Will be interesting to see just how far below the 5000 RUB price it will go before we see the arbitrage.

Posted by: ct | Apr 1 2022 19:29 utc | 96

Has the EU really been 'captured'by the US? I think not! The major European powers, Germany, France, Italy and Holland (along with the UK), are an integral part of the Imperialist Bloc. When you talk about their interests being harmed, you are conflating the interests of the capitalist classes (and their essential servants) with those of the working people of these countries. Since when have the ruling classes of the Imperialists given a flying fuck about their working classes! They have vast amounts of capital, they're not touched by the any of it, anymore than by the fake Pandemic. As with 'traditional' wars fought by capitalism, this is just another kind of war and as with traditional wars, it's not only about markets and competing capitalist classes, it's about destroying capital! It's just as much a World War as the previous ones, but fought in an entirely different way, using different weapons. It has consumed (or is on the process of consuming) even more surplus capital than WWII/III, you just don't see it! Wne will the left wise up? They got conned by the Bug and they're now being conned by the Sanctions War on the planet!

Posted by: Barofsky | Apr 1 2022 19:30 utc | 97


>The recent failed attempt by 3 Ukrainian helicopters to evacuate troops from Mariupol was a desperate mission with very low chances of success. This raises the question why would Ukraine risk what little is left of its airforce for something so suicidal?
>Macron started spamming Putin with calls, demanding permission to carry out a "humanitarian evacuation" in Mariupol with the help of French, Greek forces.
>The head of the French military intelligence is getting fired for "failures" to "proper assess" the situation in Ukraine.

So we have:
>.ua suicide mission to evacuate someone
>Macron shitting bricks and begging Putin
>Head of French military intelligence getting sacked


Further sources indicate the presence of two #France intelligence #DGSE operatives (both said to be dead) on board the crashed helicopter. This would explain #Macron's desperate please to #Putin as of late to organize a French-led evacuation from #Mariupol

#MARIUPOL—With respect to the 2nd chopper shot down, it fell several kilometres off the coast of Mariupol, in the #Azov sea. The location is currently being investigated.

#MARIUPOL—Sources indicate that, at #Azovstal, a group totaling 20—of #US (#American) & #UK (#British) military advisors of #Azov defenders, as well as several UK #SBU (#Ukraine|ian secrete police) advisors—is holed up, together with Azov fighters. They were too late to evacuate.

And a video of Ukrainian woman speaking the truth:

Posted by: Sundial | Apr 1 2022 19:31 utc | 98

I do not believe that the US has infiltrated the EU political and financial decision making process to the extent that this article suggests.

A stronger case can be made that both the US and EU are heavily influenced by the Cult of Davos. They are quite happy to see the creative destruction process unfold as it currently is, with Russia/Putin to be the fall guys for the inevitable collapse of the economic Ponzi based on unpayable debts.

The important question for the above average intelligence citizen here is, how do we ensure the stated Davos great reset model is not imposed on us?

Posted by: Opport Knocks | Apr 1 2022 19:32 utc | 99

@psychohistorian #72

however, you have to consider that already prior to the whole sanction mania, a large part if the income of gazprom (in EUR) was likely converted ito rubles. simply because the cost of gazprom arises in rubles. depending on the extent to which gazprom in the past kept their retained profits in EUR or rubles, it can be that the demand for rubles is not that much larger now than it was in the past. i would expext the effect on the exchange rate to be more on the psychological side than on the demand side.

Posted by: Sternberg | Apr 1 2022 19:32 utc | 100

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