It was to be Russia’s lethal weapon to bend the West: to plunge its inhabitants into a hellish, cold and black winter. It is ultimately an almost complete flop. As various Bloomberg articles explain, Russian President Vladimir Putin has, so far at least, failed in his bid to weaponize gas and oil, his nation’s twin breasts, in the war in Ukraine. .
Let’s start with the gas. As Bloomberg and the German Energy Minister believe, the worst is behind us. And if European finances have been and are being put to the test (we are talking about a cost of some 950 billion euros), if certain industries, large Where small but all vital, suffer terribly from soaring prices, the total collapse that Russia was aiming for did not take place.
The last weeks, rather mild on the meteorological level, are not for nothing. But this is not the only factor: the continent as a whole knew how to prepare for the worst in time.
Ultra-dependent on Russian gas, particularly in the case of Germany, Europe has been able to diversify its supplies and develop new infrastructures at high speed. And in particular its liquefied natural gas (LNG) terminalsthat she massively matter now, especially from the United Statesin addition to gas from Qatar, Algeria or Norway.
As for LNG imports, made easier – for now – by less competition with a China that is just beginning to revive its economy, Morgan Stanley believes that the situation is such that too many cargo ships reach European shores.
Adding to this a substantial drop in European consumption – Bloomberg quoting the figure of a decrease of 16% compared to the average over the previous five years –, or a few weeks of solid renewable energy production, in particular wind, Russia has been partially sidelined when it comes to gas. Imports have been divided by five, which is considerable.
Black gold is black
In the end, European gas stocks are at their highest in the depths of winter, which seems to indicate that, barring disaster, the continent can approach next winter with a little greater serenity than for the current season. As for the price of said gas on the energy markets, it has collapsed: if it remains high, it has returned in recent weeks to its pre-war level.
And oil? For Vladimir Poutine, it is not better. It is even these last days a kind of hallali for the master of the Kremlin, who sees the second pillar of his strategy collapsing. As also described by Bloombergblack gold from the Urals has lost so much of its luster that it was selling for half the price of the rest of the world market, i.e. 38 dollars per barrelTuesday, January 10.
It’s way below of the “course” set by the G7 and the European Union, which therefore no longer even needs to be, as the slump is great for Russian oil. December 5 has indeed entered into force the European embargo on Russian hydrocarbonscausing Moscow to lose one of its biggest historic customers.
For months, Russia has turned to India or China to sell its black gold, but the demand there also seems to be fallingin particular due to prices competing with those of Middle Eastern oil, due to the increase in the cost of longer maritime transport.
In short, the disaster did not occur for the West and the allies of Ukraine. With an exploding budget deficit, the Russian economy and the financing of its war in Ukraine are already suffering from the drastic drop in income from two of its main resources. Those by which she thought to hold the rest of the world: for the moment, it is missed.