What if Russia Closed the Valve?

History is loaded with lessons of past events that are so similar to current issues, it is  also loaded with examples that should teach us to be wiser in dealing with those current issues based on the mistakes and decisions of those who were there before us. And in the case of the current Russian-Ukranian standoff and how the rest of the world is dealing with it, past lessons are not so old and it should not be difficult for us to remember them and learn the moral from the story. In WWII, Nazi Germany crawled as fast as it could towards Russia and got to Stalingrad. Hitler’s orders to his troops were get Stalingrad or die. The Russians, with their ice cold patience waited and waited until winter came; the Germans froze and the rest is now history. If there is a lesson to be learnt from this story is that the Russians are patient beyond imagination and an attrition war against them will surely be lost. Imagine President Putin sitting in a room full of valves that control the gas flow from Russia to the rest of the world and imagine that he decides to close that valve that goes to Europe, what will happen to the continent that relies on Russia for more than 30% on average of its gas consumption necessary to warm that continent up? They can revert to Alcohol to stay heated but then again, where does most of the world’s vodka come from? They can’t rely on Whiskey because Dubai is already gulping the biggest quantities of that drink and I am sure that most of Europe can’t compete with that city’s purchasing power so back again to that vicious cycle and again Putin is controlling more valves.

Wars are never fought for causes whether righteous or not, wars are strictly fought for economic reasons (https://gajreige.wordpress.com/2014/01/13/war-and-economy-the-all-time-best-friends/) no country is willing to invade another country and waste billions of dollars on just “humane basis” nor is a country willing to defend another one for the same reasons. Take the Syrian war for example, early on Qatar supported the uprising and rooted for it in all possible ways and the claim was to support the rights of Syrian people but the real agenda is totally somewhere else. Sitting on some of the world’s largest natural gas wells, Qatar is the third globally in LNG (liquefied natural gas) exports lagging behind Norway and Russia, but the tiny country has ambitious dreams to oust Russia from its throne as Europe’s number 1 supplier and continue its march towards the continent after already establishing a stronghold both athletically and economically. But alas! Geography stands between dreams and reality. Being so far from Europe, Qatar can’t compete with Russia since liquefying gas and mounting it to vessels and shipping it half-way around the globe is a very expensive process that Russia has countered through its extensive pipeline chain in the continent. So what Qatar needs is an exit on the Mediterranean or an access to Europe through pipes; Russia’s close alliance with Syria was standing between Qatar and its access to a Mediterranean seaport where it could send the gas through pipes either to a Mediterranean seaport and have it liquefied and loaded on ships for a very short trip to the nearby European continent thus slashing a lot of the costs or even better yet go through Syria and then into Turkey and to the rest of Europe from there with its pipelines and in this way they would be breaking the Russian monopoly. If you take this into consideration, you will understand why Russia is defending Syria so dearly and why all the recent tension between them and Ukraine, the country through which also lots of the Russian gas goes to Europe.

A few days after the crisis started, European Union countries threatened to sever their economic ties with Russia; the continent that still has not recovered from the economic crisis may have rushed into a hasty decision. The first hint came from the Germans which stated just a few days ago that the rest of Europe might actually be the one hurt and not Russia because “we are pushing Russia more and more to rely on China” which will be a strong hit to the already suffering continent. Keep in mind that this statement came from the strongest economy in the Eurozone, so if Germany is saying that what do you think will the situation be in the rest of the PIGS? Here’s a hint, last spring I contacted a certain Spanish supplier in order to explore the possibility of importing some Broccoli and iceberg containers for the company I work for; in the first and also last phone call, the sales agent that took my call simply answered me “currently Russia’s demand for those 2 items is so strong that we are barely keeping up with the demand of our customers there and we can’t afford to start new business” she didn’t even care what was the quantity I needed or if she could have possibly made more profit on my orders rather than Russia’s orders. This year, and if the union goes through with their decision, I have a strong feeling that she will be contacting me and offering me the goods.

US stocks fumbled on the same news also as USA threatened to take a similar stance to its neighbors, Russia was fast to counter and pulled out a massive amount of cash that it has traditionally deposited in the federal reserve’s vaults and this sent massive shock waves in the US economy and this is just the tip of the iceberg. If the USA decides to further pursue this strategy, then the Chinese-Russian allegiance will get even tighter which will tighten the grip on the American neck that is already under the mercy of the Chinese economy (the balance of payments is way tipping off in China’s favor you might even think it’s broken)

A few years ago – in 2009 to be exact – A Russian Ukranian standoff led to Russia closing its gas valves and prices went sky high and further hurt the ailing continent. It is almost spring now and the Europeans might not need to keep warm but the coming winter is right behind the door and just like in WWII’s Stalingrad, the Russian polar bear has enough cold nerves to wait and wait and strike back when the time is right. Bear in mind that the man on top of Russia’s political pyramid was performing war tactics and perfecting his chess abilities when the rest of the current world’s leaders now were rocking it out to Beatle’s concerts or in the case of Mr. Obama getting high on Marijuana – he might be an old bear that’s true but with age comes wisdom and in this case lots and lots of wisdom. 

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3 thoughts on “What if Russia Closed the Valve?

    1. I think we both agree that whoever has the oil and gas has the upper hand. Yes Russia might get affected but not as much as Europe apparently. remember how much Germany was against the EU sanctions against Russia and recent reports coming from Europe suggest that the Eurozone might be going into a recession with the strongest 2 economies that is Germany and France suffering the most. I deal with Dutch suppliers and for the last 2 weeks they have been hurting a lot due to Russia stopping its business with Europe now they are sitting on massive amounts of stock that they want to get rid of……

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