The Ukrainian bluff. How the Atlantic West yielded Russian gas to China

5 min read
A military trainer with Ukraine’s 112th Territorial Defense Brigade works with civilians during a military exercise in the outskirts of Kyiv

A military trainer with Ukraine’s 112th Territorial Defense Brigade works with civilians during a military exercise in the outskirts of Kyiv

A new chapter and friction between the blocks in the conflict over energy. On the one hand China and its dependence on coal, on the other, the west and its stormy relations with Russia on the western borders.

With Russian troops deployed on the borders, the NATO secretary announces that we are ready for war. The newspapers scream in alarm, European leaders meet to talk about the crisis, Biden promises embargoes and retaliation, while Putin meets and reassures entrepreneurs, the crisis is on the borders of Europe.

Ukraine’s entry into NATO – an obsolete institution – is matched only by the Cuban missile crisis facing Florida, but the fears of the Russians are less justified than those of the Americans, and seem to be for good press.

According to strategic analyst Max Ferrari, the Russian military option is not on the table. He says that the leaders of Eastern Europe are suggesting dialogue to minimize tensions at the borders, just as escalation seems to be a Western media choice that does not correspond to Putin’s strategy.

“Intuta quae indecora” Tacitus would tacitly say, that is dishonest things are dangerous, so it is necessary to clarify the matter, because this is a matter of gas and exploitation, energy policies and CO2. Russia has gas reserves that are worth 60% of its gross domestic product

and the largest world reserves of methane gas equal to 24% of the total

In 2018 – the last pre-pandemic year – the Russian Federal Statistical Service (Rosstat) calculated that the country’s industrial production index indicates that the share of oil and gas production in the Russian economy is 38.9%.

Today the European Community buys more than a third of the gas it uses from Russia. In spite of this, on 15 December the Council reached an agreement on the revision of the regulation on trans-European energy networks (TEN-E) to achieve climate neutrality by 2050, with the first structural reductions by 2030.

The goal of the new regulation is to modernize, decarbonise and interconnect the EU’s cross-border energy infrastructures, as well as ensuring market integration, competitiveness and security of supply.

Thus Jernei Vrtovec, the Slovenian Minister of Infrastructure, said: “The agreement reached ensures that no new fossil fuel-based projects will receive funding from the Connecting Europe Facility in the future. Thanks to today’s agreement, we will invest in a green and climate-neutral future that will guarantee efficiency, competitiveness and security of supply, without leaving anyone behind. “

The European community took this decision after a heated internal debate. Today methane is the real antagonist to the Economic Green Revolution, because it is capable of polluting 80 times more CO2 in a twenty-year time scale.

The group of 11 hardliners is made up of Austria, Belgium, Germany, Denmark, Estonia, Ireland, Luxembourg, Lithuania, the Netherlands, Spain and Sweden, while other countries such as Italy have maintained a more cautious attitude.

Green fervor and ecolatry undermine relations between the European Community and Russia, as noted by Valentina Iorio from the pages of Corriere della Sera of 24 August 2021 in the article “The EU tax on CO2 at the border for Russia is worse than sanctions”:

“The objective of the” carbon adjustment mechanism at the border “is to reduce the risk of carbon leakage. That is to say the risk that EU-based companies move emissions-intensive production abroad to take advantage of less stringent regulations.

Brussels expects to raise almost 10 billion euros a year from the Carbon Border Adjustment Mechanism, once it is fully operational in 2026.

The second objective of this tax is to feed the EU budget, both to cover the resulting needs from the Next Generation EU and to ensure greater fiscal autonomy for the Union in the future.

Russia estimates that the tax could affect its goods by s much as $ 7.6 billion (€ 6.47 billion). In the immediate future, the tax would affect exports of iron, aluminum, pipes, electricity and cement, but Moscow fears that in the future it could be expanded to also affect exports of oil, gas and coal.

Igor Sechin, Russian Economic Development Minister, in recent weeks stated that EU plans to introduce a CO2 tax at the border may not be in line with World Trade Organization (WTO) rules.”

The Russian leadership has perfectly understood the emergency and considered the impact on its economy. Producer Russia, like consumer China, are threatened by the green choices of the West.

Coal and gas, or energy, are the main sources of Russian exports and Chinese imports. The green God wants his tribute and the risk is to bring Moscow closer to Beijing, because Russia has the raw materials and China the production and manufacturing.

A complex issue, because the European strategic choice hands over the resources of the Third Rome to the plague that comes from the East.

PS A few days after the approval of the regulation on trans-European energy networks (TEN-E), a note from Ansa arrived on 1 February: BRUSSELS – Gas and nuclear are energy sources useful for the ecological transition of the EU and may have, under certain conditions, the EU label for green investments.

This was decided by the European Commission with the adoption of the related delegated act. As announced, the provision was launched with marginal changes compared to the draft of last December 31st and will now have to be examined by the Council and Parliament.

The changes concern the removal of intermediate targets, for the conversion of natural gas plants to decarbonised gases, and the part on transparency for investors, so that they are informed if the financial products are in some way linked to gas and nuclear. The first change was requested by Germany. The second from the Sustainable Finance Platform. The rest of the criteria are practically the same for both nuclear and gas.

Russia has achieved the goal. The Ukrainian threat and bluff will deflate, to Europeans the evidence of a ruling class inadequate to the challenge of the times that has created international tensions, a (green) and bad (imported) inflation unknown for over thirty years.

The article was originally published on the Italian language site

Tony Simon

Leave a Reply

Your email address will not be published. Required fields are marked *