The oil-and-gas sector makes up around 40% of its budget revenue. Some 1.5 million people who work in the industry might lose their jobs by next year, analysts say. https://www.wsj.com/articles/russia...ing-to-feel-the-bite-of-sanctions-11648038935
Putin wants ‘unfriendly countries’ to pay rubles for gas https://apnews.com/article/russia-u...urope-moscow-4790d3d85ac2cf9a8d8b19d2717c0e03 President Vladimir Putin announced Wednesday that Russia will demand “unfriendly″ countries pay for Russian natural gas exports only in rubles from now on. Putin told a meeting with government officials that “a number of Western countries made illegitimate decisions on the so-called freezing of the Russian assets, effectively drawing a line over reliability of their currencies, undermining the trust for those currencies.” “It makes no sense whatsoever,” Putin added, “to supply our goods to the European Union, the United States and receive payment in dollars, euros and a number of other currencies.” As a result, he said he was announcing “measures” to switch to payments for “our natural gas, supplied to so-called unfriendly countries” in Russian rubles. The Russian president didn’t say when exactly the new policy will take effect. He instructed the country’s central bank to work out a procedure for natural gas buyers to acquire rubles in Russia. Economists said the move appeared designed to try to support the ruble, which has collapsed against other currencies since Putin invaded Ukraine on Feb. 24 and Western countries responded with far-reaching sanctions against Moscow. But some analysts expressed doubt that it would work. “Demanding payment in rubles is a curious and probably ultimately ineffective approach to attempting an end run around Western financial sanctions,” said Eswar Prasad, a professor of trade policy at Cornell University. “Rubles are certainly easier to come by now that the currency is collapsing. But exchanging other currencies for rubles will be quite difficult given the widespread financial sanctions imposed on Russia.” “The hope that demanding payment in rubles will increase demand for the currency and thereby prop up its value,” Prasad added, “is also a false hope given all the downward pressures on the currency.” Neil Shearing, group chief economist at Capital Economics, said: “It’s not an obvious move to me, since the (Russian) economy needs a supply of foreign currency in order to pay for imports — and energy is one of the few sources left.” German Economy Minister Robert Habeck accused Putin of breaking contracts with the move, German news agency dpa reported. Habeck said Wednesday in Berlin that the German government would discuss the matter with European partners. Habeck said Putin’s announcement shows once again that Russia is not a stable partner, dpa reported. Despite severe Western sanctions, natural gas flows are still heading from Russia to Europe. The European Union is reliant on Russia for 40% of the natural gas it needs to generate electricity, heat homes and supply industry — a key reason why the EU has not applied its sanctions to Russia’s energy industry. At the same time, across Europe, governments are slashing fuel taxes and doling out tens of billions to help consumers, truckers, farmers and others cope with spiking energy prices made worse by Russia’s war on Ukraine. Vinicius Romano, a senior analyst at Rystad Energy, suggested that Moscow’s insistence on payments in rubles “may give buyers cause to reopen other aspects of their contracts — such as the duration — and simply speed up their exit from Russian gas altogether.”
Who says public opinion doesn't work? Renault-Nissan has resisted all this time stopping trade with Russia. Only yesterday they categorically stated that they will continue their operations there. Today after Ukrainians called for a Renault boycott and a fairly sustained negative public reaction towards Renault's stance, they announced they are stopping operations in Russia, including their production plant in Moscow and are reassessing their stake in AvtoVaz.
The French government is their largest shareholder and Macron is up for election next month. Not the best combination if a corporation is trying to lay low and avoid scrutiny.
As I said the other day, some people assume that Russia is going to find a way to not default just because they were able to make that payment last week by using duct tape, bondo, and sacrificing a couple chickens and doing a few Hail Marys. Nope, the road ahead is even more steep. They may find a way but it will require some work and financial gymnastics. Russia will likely default with April 4 payment due of $2.2B: experts https://nypost.com/2022/03/24/russi...ebt-with-april-4-payment-due-of-2-2b-experts/
U.S., EU strike LNG deal as Europe seeks to cut Russian gas https://finance.yahoo.com/news/u-eu-strike-lng-deal-090456829.html?.tsrc=fin-notif BRUSSELS/BERLIN (Reuters) -The United States will work to supply 15 billion cubic metres (bcm) of liquefied natural gas (LNG) to the European Union this year to help wean it off Russian gas supplies, the transatlantic partners said on Friday. The EU is aiming to cut its dependency on Russian gas by two-thirds this year and end all Russian fossil fuel imports by 2027 due to Russia's invasion of Ukraine. Russia supplies around 40% of Europe's gas needs. Concerns over security of supply were reinforced this week after Russia ordered the switch of gas contract payments to roubles, raising the risk of a supply squeeze and even higher prices. U.S. LNG plants are producing at full capacity and analysts say most of any additional U.S. gas sent to Europe would have to come from exports that would have gone elsewhere and already high European gas prices would have to rise further to attract those cargoes to the 27-nation bloc. LNG under contract cannot be easily redirected. "It normally takes two to three years to build a new production facility, so this deal may be more about the re-direction of existing supplies than new capacity," said Alex Froley, gas and LNG analyst at ICIS. Senior U.S. administration officials did not specify what amount or percentage of the extra LNG supply would come from the United States. Even if the 15 bcm is achievable, "it still falls well short of replacing Russian gas imports, which amounted to around 155 bcm in 2021," analysts at ING Bank said. GERMAN RELIANCE ON RUSSIA U.S. President Joe Biden and European Commission President Ursula von der Leyen also announced a plan to form a task force to reduce Europe's reliance on Russian fossil fuels. The Commission will also work with EU countries to ensure they are able to receive about 50 bcm of additional LNG until at least 2030, the factsheet provided by the White House said. It was unclear whether it referred to amounts additional to last year's 22 bcm of U.S. exports to the EU. The EU has already stepped up efforts to secure more LNG after talks with supplier countries, resulting in record deliveries of 10 bcm of LNG in more than 120 vessels in January. Meanwhile, Germany, the EU's biggest importer of Russian gas, said it has made "significant progress" towards reducing its exposure to imports of Russian gas, oil and coal. However, Economy Minister Robert Habeck also said it could take until the summer of 2024 for Europe's largest economy to wean itself off of Russian gas. German utilities on Thursday said their country needed an early warning system to tackle gas shortages as Putin's demand for gas payments in roubles left companies and EU nations scrambling to understand the ramifications. Some countries, such as Italy, said they would continue to pay in euros. The CEO of Poland's PGNiG, said the company - which has a contract with Gazprom until the end of this year - could not simply switch to paying in roubles. Russia's demand for payment in roubles for gas still needs to be backed by a concrete mechanism. A spokesman for Germany's Uniper said on Friday: "We have not received any official notification or request to process the settlement in roubles." The German economy minister said the government will consult with its partners about Putin's demand for payment in roubles.
Russia is considering selling its oil for Bitcoin. I get the Bitcoin people are going to be happy with the prospect but this does not bode well for the average Russian. https://www.cnbc.com/2022/03/24/rus...ayment-for-oil-and-gas-as-sanctions-rise.html
The problem here is clearly written in the article and one many people on the right simply do not understand, the US is pumping gas and oil at near capacity. We don’t even have the capacity to ship more if we had the capacity to pump more.
We have natural gas capacity. There are even drilling locations burning off excess natural gas. Now the issue of capturing the gas, transporting it to a port, capacity to hold it at the port, and available ships to transport it to Europe are a totally different matter — and probably where the problems are at for achieving the objective of supplying LNG from the U.S.