Europe restricts Russian travelers as Russia opposes Tit-for-Tat visa requirements


Epidemic of oil and gas psychosis in so-called hostile countries continues to escalate as G7 countries (UK, Germany, Italy, Canada, France, Japan and US) plan to introduce cap prices for Russian oil by December 5.

This decision will further unbalance global oil and gas flows with unpredictable consequences for all market players. The G7 members finally froze the ideals of the “free market” and “free competition”, as well as those of free access to energy resources, including LNG, and to transformed hydrocarbons. This will certainly affect prices and other important factors that will be very visible in the global energy field.

Do you want to remove Russia, one of the world‘s three largest players, from this market? If so, you will get a serious distortion of the whole system – oil, gas, price, economic. Yes, it will benefit the United States, but pretty much everyone, including the American G7 partners, not to mention everyone else in the global energy market.

The Americans, as always, are leading the way with repressive statements, with Republican Senator Marco Rubio having already drafted a bill sanctioning oil and LNG shipments from Russia to China. However, a halt in oil supplies from Russia will force Beijing to join the fight for hydrocarbons from the Middle East and Africa, which is sure to drive up prices.

The West continues to step up its sanctions pressure on Russia, justifying this with Moscow’s ongoing special military operation in Ukraine.

The events of the past 12 years have changed the energy and political landscape of the world, with the United States going from the world’s largest consumer of oil and gas to its first major producer and exporter, while China has become the main consumer of these Resources. .

During the 1990s and early 2000s, the United States and the International Energy Agency believed that for the foreseeable future, America would remain the world’s largest importer of energy resources. Therefore, Washington was actively seeking external partners in the energy sector, while Russia was considered one of the main such partners, along with Saudi Arabia. Indeed, after the crisis of the 1970s, the United States relied on the Middle East – above all on the Kingdom of Saudi Arabia – as the main guarantor of its own energy security. During the 1990s, Washington’s hopes naturally fell on Russia.

Russia needed technology, investment, and management experience from the United States, and the United States needed Russian energy resources, especially oil and gas, and Russian markets for American products. This cooperation was developing rapidly, and in the 1990s, American companies actively participated in the implementation of large oil and gas investment projects in Russia (Sakhalin-1, Sakhalin-2, etc.), the US government providing strong political support and prioritization of these projects.

The Gore-Chernomyrdin Commission, where I worked, was directly involved in promoting these projects. One of the results of the May 2001 meeting between the presidents of Russia and the United States was the idea of ​​an energy dialogue between the two countries, aimed at promoting commercial cooperation in the energy sector. energy by increasing interaction between Russian and American companies engaged in the exploration, production, processing, transportation and marketing of energy resources, as well as in the implementation of joint projects, including in third country.

Also in 2001, the white paper “US-Russia Partnership: New Times, New Opportunities” was released, which set out the position of the US Congress regarding energy cooperation with Russia. The document explicitly stated that the development of bilateral energy cooperation should become a priority of American foreign policy, since the United States could thus “protect itself from the risks of uncertainty in energy supplies and unnecessary dependence.”** ( American Foreign Policy Council (Washington, DC: Franklin’s Printing Company, 2003.)

However, American technological advancements and new industrial breakthroughs achieved in a single decade have turned the situation upside down. With the advent of the shale revolution, the pace of cooperation between the two countries, including in the field of energy, has slowed down. A shift in America’s priorities has pushed its energy partnership with Russia into the background. Moreover, the dramatic reduction in energy ties with Russia has become an additional factor in Washington’s push for a general escalation of tensions with Moscow. Similar things are happening with our main European partner, Germany. “In addition to the pandemic, sanctions, global trade disputes and protectionism have become a serious challenge for large German companies, medium-sized companies and family businesses operating in Russia,” said Rainer Seele, former company executive. Austrian OMV.

In Europe, dreams of a future low-carbon energy are still alive, even if the upcoming winter season has put them on the back burner. The German government fears that the shortage of gas this winter will cause emergencies in several regions of the country. In France, representatives of the industrial sector are seriously concerned about rising gas prices and warn that in the worst case scenario, this could lead to a complete collapse in production.

By the way, Russia earlier offered its European partners to sign long-term contracts for the supply of natural gas. However, Brussels considered this proposal unprofitable, preferring to buy gas at floating spot prices. As a result, Europe has been forced to reactivate its shut down coal-fired power plants – a move that was only recently condemned by the European Union.

If you’re thinking not seasonally, but on a large scale, you should have a clear picture of what global natural gas consumption will look like, at least in the next five years. For example, its main consumer, China, has increased its gas consumption by more than 30 billion cubic meters per year over the past five years and plans to increase by 2030 the share of gas to 15% of l energy, compared to 8% in 2021. This means that the rapid growth of gas demand in China will continue until the end of this decade. The exact source of this gas is another question, which falls under Beijing’s energy policy.

So, does the world need more hydrocarbons or not? Have we “forgotten” coal or are we using it? Is nuclear energy necessary in the future or is it also classified as an unwanted source of energy? All of these issues are under continuous discussion at the highest level in countries that bow down to the United States. Total confusion! And for global energy development, this is absolutely unacceptable and even extremely dangerous! As for the Americans, they are delighted with this whole situation with an increase in their export potential and large shipments of LNG to Latin America, Europe and Asia.

Meanwhile, with the issues of the pandemic (as an objective factor) and the issue of global warming being exaggerated, hydrocarbon producers no longer have 5-10 year production guidelines and politicians have all but banned banks to finance hydrocarbon projects and insure the risks of mining companies. Therefore, British Petroleum says it will exit the hydrocarbon energy market within a decade or two. After all, any serious energy project requires billions of dollars of investment with a development perspective of at least twenty-five years.

I am sure that global gas consumption will increase. In the next five or six years, the planet will need an additional 150 billion cubic meters of natural gas. If Russian gas is gradually withdrawn from European markets, by 2027 they will have to find around 300 billion in addition to 2021 volumes.

We must act now, without going back on the contradictory decisions of countries entangled in the energy policy of Washington and Brussels.

The world of energy needs stability and predictability. If the United States is going astray, then someone has to chart the right unifying course. I must say that China, the main consumer of hydrocarbons, has a vital interest in the stability of this world, as do the main players in the Middle East and the OPEC countries. They are the ones who, together with Russia, will have to chart the course for the energy development of our planet.

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