by Arthur Foxake, 6 October 2022
Days before the Russian army crossed the border into Ukraine in February this year,
the U.S. and the EU put reams of sanctions onto Russia in anticipation of the incursion. At the same time and in concert with other NATO allies the US, UK and EU governments also siezed $300 billion of Russia's assets that were invested in western banks. The sanctions had been negotiated between the EU (mainly France and Germany) the UK and the
U.S. and their scope was prepared over several months. Unfortunately, in the traditional manner of politicians and government advisers, the people behind it had not thought things through properly.
The aim of the sanctions, to bankrupt the Russian economy within a few weeks by excluding Russia from international trade had overlooked one big thing - that western Europe, i.e. Germany, France and other EU member states were heavily dependent on Russian oil and gas for industrial, transport and domestic fuel. Thus the sanctions quickly turned the situation around and bit the people that imposed them on the arse. Unintended consequences, the inevitable result of not thinking things through properly, had stuck again.
The deluded people behind those sanctions had no idea how greatly the world depends on oil and how many potential customers there were outside the EU eager to buy Russia's oil and gas, especially at the discounted prices on offer. The sanctions only proved how robust Russia's economy really is and how vulnerable the economies of Germany, France, Italy, Spain and Poland are.
On top of boosting the Russian economy and driving up the value of the Rouble against other leading currencies, the sanctions led to a shortfall of energy in Europe, , causing rationing of electricity in some areas, and increased the already soaring inflation rates, hitting the cost of living for most people on average incomes and driving millions into poverty.
Meanwhile in Russia food and fuel prices are falling and its general economic numbers are good. The now higher energy prices generate sufficient additional income which more than covers the cost of its war efforts.
Any sane policy maker would conclude that sanctions failed miserably, harming the economies of those nations which imposed them far more than the intended target and that lifting them would help Europe more than it would help Russia. But no, the U.S. and European globalist elites, as ever incapable of admitting they got it wrong, are no longer able to act in a sane manner. They are instead upping the ante with the most crazy sanction scheme one has ever heard of:
from NY Times:
[T]he European Union pushed ahead on Wednesday with an ambitious but untested plan to limit Russia’s oil revenue.
If the global price of oil remains high, it would complicate the European Union’s effort to impose a price cap on Russian oil that was expected to gain final approval on Thursday, after E.U. negotiators reached an agreement on the measure as part of a fresh package of sanctions against Moscow.
Under the plan, a committee including representatives of the European Union, the Group of 7 nations and others that agree to the price cap would meet regularly to decide on the price at which Russian oil should be sold, and that it would change based on the market price.
Several diplomats involved in the E.U. talks said that Greece, Malta and Cyprus — maritime nations that would be most affected by the price cap — received assurances that their business interests would be preserved, the diplomats said.
The countries had been holding up what would be the eighth sanctions package the European Union has adopted since the Russian invasion of Ukraine because of worries that a price cap on Russian oil exported outside the bloc would affect their shipping, insurance and other industries, the diplomats said.
With oil prices at a high, Russia is raking in billions of dollars in revenue, even as it sells smaller quantities. The cap — part of a broad plan pushed by the Biden administration that the G7 agreed to last month — is intended to set the price of Russian oil lower than where it is today, but still above cost. The U.S. Treasury calculates that the cap would deprive the Kremlin of tens of billions of dollars annually.
Now how do the US treasury along with those in allied nations suppose they can make a big producer with vast reserves of a rare commodity sell its product below the general market price? Again these delusional clowns are assuming they are so powerful and so influential that wherever they lead the rest of the world must follow. That would only be possible in a buyers market, in fact the world is awash with oil and gas. Thus it is an economic impossibility to dictate to any supplier to which customers they can sell and at what price This was proved by Demented Joe Biden earlier this week when he demanded the OPEC (Organisation of Petroleum Exporting Counties) nations increase production and hold prices steady. Saudi Arabia, the world's biggest oil producer simply told the American president to get lost. The White House was not impressed buy was powerless to pressure the oil producers as most OPEC members have thown in their lot with China and Russia.
The Biden administration is absolutely furious with the Joint Ministerial Monitoring Committee (JMMC) of the Organization of the Petroleum Exporting Countries (OPEC) and allies, including Russia, for agreeing to slash oil production by 2 million barrels per day.
CNN's Chief Congressional Correspondent Manu Raju tweeted that President Biden responded to the OPEC+ cut announcement by saying he's "concerned" and called it "unnecessary." In light of today’s action, the Biden Administration also announced will consult with Congress on additional tools and authorities to reduce OPEC's control over energy prices.
It seems the dementia stricken president and his loony left handlers think America can still use dollar dominance to manipulate other nations. Unfortunately for them but fortunately for the rest of the world perhaps, the way OPEC leaders told Biden to shove his demands up his fracking orifice should have told people with a little self awareness that those days are gone.
Russia has declared that it will not sell any oil to any party that supports the G7 price fixing regime. That is why neither China nor India nor any other country besides the EU and U.S. will agree to adhere to it.
The whole idea is crazy and too complicated to achieve anything other than further undermining the economies of the USA's European allies. Under the proposed rules, companies involved in the shipping of Russian oil — including shipowners, insurers and underwriters — would be on the hook for ensuring that the oil they are helping to transport is being sold at or below the price cap. If they are caught helping Russia sell at a higher price, they could face lawsuits in their home countries for violating sanctions.
Under the U.S. / E.U. deal, Greece, Malta and Cyprus will be permitted to continue shipping Russian oil. Had they not agreed to place their companies at the forefront of applying the price cap, they would have been forbidden from shipping or insuring Russian oil cargo outside the European Union, a huge hit for major industries.
More than half of the tankers now shipping Russia’s oil are Greek-owned. And the financial services that underpin that trade — including insurance, reinsurance and letters of credit — are overwhelmingly based in the European Union and Britain.