The War in Ukraine

2,721 posts in this topic

2 hours ago, jeba said:

Sanctions may have harmed Russia’s credit-worthiness, but the 70% surge in world gas prices alone has supercharged its balance of payments. Its current account trade surplus, according to its central bank, is now over three times the pre-invasion level. At the same time, sanctions are clearly hurting countries in western and central Europe who are imposing them.

 

This is actually a key question. What is driving the increase in the price of oil and gas? The war? Sanctions? Speculation?

Do we pay 2x or 3x for LPG vs. Russian gas?

Who exactly is putting up the gas/oil price? Was this all not defined by long term contracts?

0

Share this post


Link to post
Share on other sites
Just now, scook17 said:

Was this all not defined by long term contracts?

 

Apparently not. The contracts only specify purchase/supply quantities. The prices float freely.

0

Share this post


Link to post
Share on other sites
36 minutes ago, jeba said:

 

Any substantial counterarguments? Like pointing out where Jenkins is wrong?

 

Will dropping sanctions result in the opening up of Ukraine's Black Sea ports for grain exports? Putin has hinted as much but that in itself indicates the sanctions are hurting and would you trust him to honour such a hint and not close them again if something, like say the USA supplying long range missiles, happened he did not like. It would hand Russia an ongoing bargaining chip to get his own way in the war. Much better I think to set up an international task force to protect shipping exporting from Ukrainian ports.

0

Share this post


Link to post
Share on other sites
55 minutes ago, keith2011 said:

 

Will dropping sanctions result in the opening up of Ukraine's Black Sea ports for grain exports? Putin has hinted as much but that in itself indicates the sanctions are hurting and would you trust him to honour such a hint and not close them again if something, like say the USA supplying long range missiles, happened he did not like. It would hand Russia an ongoing bargaining chip to get his own way in the war. Much better I think to set up an international task force to protect shipping exporting from Ukrainian ports.

 

We should be handing over advanced anti shipping missiles to the Ukraine, then the Ukraine can say 'we will ship our grain to our customers, each downed grain ship will result in a downed Russian warship". The International community does not  really need to get involved.

 

But yes I am against Jeba's approach on this. Giving in to this mad man will only make it worse in the longer term, and we have to accept the damage done to our own economies in the short term/. It worth it

0

Share this post


Link to post
Share on other sites
43 minutes ago, scook17 said:

 

To put that in prospective

Quote

Gazprom said Shell would lose up to 1.2 billion cubic meters worth of annual gas supply — just a tiny fraction of the 95 billion cubic meters the country consumes each year, according to Germany’s economic ministry.

 

https://www.cnn.com/2022/05/31/energy/russia-shell-germany-gas-shut-off/index.html

0

Share this post


Link to post
Share on other sites
1 hour ago, jeba said:

 

Any substantial counterarguments? Like pointing out where Jenkins is wrong?

I was agreeing with him

0

Share this post


Link to post
Share on other sites
8 hours ago, scook17 said:

Was this all not defined by long term contracts?

That used to be the case until some years ago. Nowadays, only few older contracts have prices fixed long-term. Gazprom is laughing all the way to the bank now because gas prices have quadrupled.

0

Share this post


Link to post
Share on other sites

On the effectiveness (or not) of sanctions: https://finance.yahoo.com/news/world-paying-putins-war-ukraine-040145489.html

Quote

Even with some countries halting or phasing out energy purchases, Russia's oil-and-gas revenue will be about $285 billion this year, according to estimates from Bloomberg Economics based on Economy Ministry projections. That would exceed the 2021 figure by more than one-fifth. Throw in other commodities, and it more than makes up for the $300 billion in foreign reserves frozen as part of the sanctions. ...

 

... The current account surplus, the broadest measure of trade in goods and services, more than tripled in the first four months of the year to almost $96 billion. That figure, the highest since at least 1994, mainly reflected a surge in commodity prices,

 

Quote

“If the goal of sanctions was to stop the Russian military, it wasn't realistic,” said Janis Kluge, senior associate for Eastern Europe and Eurasia at the German Institute for International and Security Affairs in Berlin.

But let's go ahead with sanctions anyway! Who cares if our economy goes down the drain (even if for no gain)!

 

0

Share this post


Link to post
Share on other sites
3 hours ago, jeba said:

On the effectiveness (or not) of sanctions: https://finance.yahoo.com/news/world-paying-putins-war-ukraine-040145489.html

But let's go ahead with sanctions anyway! Who cares if our economy goes down the drain (even if for no gain)!

 

That's a pretty damming article to the ability of the west to seek political change through economic means.

Whilst the physical amount of products went down, price went up, so EU and elsewhere pays far more money to Russia, for far less quantity of goods.

Well that kind of back fired, in terms of economic impact.

 

Gas supplier wrote me as of June 1st, prices increases to 17c/KWh. In 2019, it was 4.3c/KWh. That around 4x the price it was in 2019.

I am guessing by winter it will be >20ct.

Diesel from under 1Euro/litre in pandemic time to around 2Euros/L. Double the fuel cost for anyone who drives regularly.

This will hurt normal people, and if the effect on Russia, is zero, then soon public opinion will shift against such measures.

 

However, the security of supply issue I see as a more pressing one. It's clear that there should have been diversification and not concentration of sourcing.

Politicians have been caught sleeping at the wheel (best case) or else with a snout in the trough.

 

Seems they may soon introduce 0% VAT on solar panels. It's amazing to think these still have VAT charged on them.

https://www.reuters.com/article/factcheck-europe-solar-idUSL2N2W41EY

 

Yet I fail to see any large measures announced in Germany to speed up solar/wind/hydro energy production. If anything they put measures in place to slow!!! the take up of such things. There are many EU countries far ahead of Germany here:

https://www.cleanenergywire.org/sites/default/files/styles/gallery_image/public/paragraphs/images/fig6-share-electricity-renewable-sources-gross-electricity-consumption-europe-2019.png?itok=iUQY9v2F

0

Share this post


Link to post
Share on other sites

OPEC+ agrees on bigger oil-output hikes for coming months

 

https://www.aljazeera.com/economy/2022/6/2/opec-agrees-on-bigger-oil-output-hikes-for-coming-months

 

OPEC+ will increase the size of its oil-supply hikes by about 50%, bowing to months of pressure from major consumers including the US to help ease the pain of high energy prices.

Ministers agreed on Thursday that the group should add 648,000 barrels a day of oil to the market in July and August, up from 432,000 barrels a day in recent months,

 

This will help depress the value of oil, as increased  supply normal does.

 

Means Russia will be  make less money selling its oil. :) 

 

 

0

Share this post


Link to post
Share on other sites
38 minutes ago, fraufruit said:

How much per barrel I wonder.

 

If I knew the answer to that question, I would be out selling or buying Oil stocks.

 

Oil stocks have been going up nicely over the last months and they pay a good dividend, 

 

My gut feeling is that its not going to make a huge difference to the oil price and the major oil companies, will continue to post record profits and have further share buy back programs, which will boost the stock price, but I want to look at it in more detail ....

0

Share this post


Link to post
Share on other sites

They are upping their sales because the energy prices are so high. At least that's how I see it.

 

Good business.

 

 

0

Share this post


Link to post
Share on other sites

yes I agree - Oil price is dependent on supply and demand, When Putin invaded the Ukraine, the West decided, to stop buying oil from Russia, this meant it was buying it from the rest of the world. Their is not enough from the world, so the West, buys what it can, this pressure to buy, causes the price of oil to go up. If then other country increase the supply the price will come down again. 

 

But if they sell too much oil the price will drop very much and they will lose money per barrel, they do not want that,the oil companies

 

On the over hand, if the oil prices stay very high for a long time, businesses may go bust as they cannot afford it and pass those costs on to the public, that would cause a recession, then eventually demand would fall as more and more businesses would go bust,

 

The trick is to keep a higher price, with a good demand, always difficult to predict, as other factors are weighing on the economy as well

 

 

0

Share this post


Link to post
Share on other sites

Western Support for Ukraine Has Peaked

 

Maybe soon it will finally be time for other voices to be heard. I also read an opinion piece in the New York Times today raising doubt at hawkish positions. Listen to Macron and Kissinger.

 

 Peace soon is necessary for many reasons - for example to avoid a global hunger crisis ( what some of you would call whataboutism).

 

0

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now