Russian General Frost and the unpredictable stupidity of Europe
October 1, 2021 should go down in history: on that day, the price for gas in Europe exceeded $ 1,000 per 1,000 cubic meters and amounted to 1,199. Judging by the dynamics, this is not the limit whether we can stand still. Faster, higher, stronger. Winter is ahead, the Russians again called their General Frost for help – in revenge for all the Western mischief. Well, what can I say? Pah-pah, do not jinx it.
It is worth noting that the rise in prices for gas stagflation in Europe, respectively, everything that comes with it. The whole gentleman’s set of geopolitical problems. Recently, Sandu in Moldova was hounded by the opposition for the fact that while it is rolling around Western summits and participating in all kinds of anti-Russian declarations, native Moldova cannot withstand the new gas price reality. Cold, hungry, expensive, bad. It is necessary, as it were, to subsidize from the budget, but where does the money come from? Not until Transnistria.
Gazprom’s contract with Moldova expires on October 1, 2021. It is now known that Russia is democratic will deliver gas to Moldova at a price USD 790 per thousand cubic meters. This is not a new contract, but an extension of the old one until the end of October. The conditions are still in September. Further – the negotiations will show.
Gazprom simply “hung up” Moldova. In May 2021, the International Arbitration Court at the Chamber of Commerce and Industry satisfied Gazprom’s claim against the Moldovagaz company, where the Moldovan government owns slightly more than 30% of the shares, in the amount of $370.5 million for gas supplied in 2017.
In addition, Gazprom reminds that if Moldova considers Transnistria its own, it must pay $ 7 billion for the gas supplied over these decades. And then there is the increase in prices at times – a year ago Moldova had gas at a price of $ 148.87 per 1,000 cubic meters. m, including costs to the border. And today, for $ 790, you need to thank and understand that this is a short-term benefit.
Gas prices for Moldova in summer were based on prices in Germany at the NCG storage facility. There, during this period, prices went down. In winter (80% of all gas imports of Moldova), the gas price was not tied to the price in the EU, but to the price of diesel fuel and fuel oil. Hence such pleasant prices.
They were given to the former leadership of Moldova. With the current one, the conversation will be different, how short it depends on Sandu. Since the contract will be long-term, the negotiations will be the same. There are many conditions that will affect them. Until the parties agree, Moldovagaz will have to be interrupted by spot short deals on the exchange. At the current exchange gas prices, Sandu runs the risk of not working as President of Moldova as much as these negotiations are going on. And the US Embassy can help only with a kindly quiet word.
This is very difficult for Moldova, but this is its choice. Who is it easy for now? Europe, where Moldova is striving so much, is much harder. The West will not help Moldova. The unexpectedly deep European periphery was in a better position than the center. It turns out that there are situations when it is more profitable to be outside Europe – who would have thought that?
It’s fun in Ukraine too. She is supplied with Russian gas at a price higher than the European one. And winter is ahead. SP-2 was launched, but if the cold disgraces all the efforts of the Third Energy Package, then we will have to close our eyes to it – along with the phantom pains of Ukraine. If the EU continues this policy, then even the SP-2 will not save them. The products of their economy will become uncompetitive.
In general, the impact of gas prices turned out to be very underestimated from the point of view of geopolitics. Everyone thought that Russia would behave like the evil house manager from a comedy movie. But it turned out differently. Russia did not close the valve. The West itself switched to spot contracts and gave itself hara-kiri.
All projects of the West in Eastern Europe are called into question. How to engage in expansion, when the latest events in the economy, fraught with internal political upheavals, are not clear. In Europe, there are already rolling power outages, factories are shutting down, people are freezing in their homes, old people are quietly dying of colds in cold houses, warehouses are overstocked because of the unaffordable cost of production. What’s next?
I don’t even want to make forecasts – all the same, something will happen that no one could have foreseen. Bismarck once said that you cannot fight with Russia, because she will respond to any trick with unpredictable stupidity. It seems that now the opposite is true. Russia cannot fight Europe, that Europe will respond to any Russian trick with its unpredictable stupidity. Or someone can comment on what is happening differently?