In the aftermath of the explosions in the Baltic Sea that caused damage to pipelines used to transport Russian natural gas to Germany, geopolitical tensions are ratcheting up. Although the mass media, in its coverage on the issue, has blamed Russia decisively for the act of sabotage, the evidence points elsewhere. Who sabotaged the Nord Stream Pipelines- Russia, or USA?
Let’s first agree that Russia sells the majority of its natural gas exports to Europe. In other words, Europe is dependent on Russian energy imports as much as Russia is dependent on Europe to buy its energy exports.
Further, let’s establish the fact that building alternative pipelines to supply Europe with Mediterranean natural gas or US energy- for instance- would take more than a year for all that non-Russian energy to get online.
And in the absence of ground-breaking evidence to suggest otherwise, Russia’s Putin is a rational actor. If you watch the mainstream media, you might think otherwise, but that a topic for another day. For now, the author of this piece believes that Putin hopes to reach a resolution in which he can force NATO and the Western bloc away from expansion into Ukraine, and in return resume energy sales to Europe. Cutting off gas to Europe is a means to that end, a temporary tactic. And Putin must have calculated that he would bring back home a relatively quick “victory” that he could sell to the Russian people.
Whether it was thought through as part of a winning strategy is another matter. But anyway, Putin must have thought that Europe would not afford to defend Ukraine- especially not at the expense of higher inflation at home, the Euro depreciating towards Dollar parity, German trade balance turning red for the first time since 1991, German industry going offline and inching ever-closer towards outright bankruptcy. Well guess what? Europe chose Ukraine, and apparently Europe is prepared to pay a price, a hefty one.
No Way Back from Here On
Given the premises outlined above, damaging the pipelines is at complete odds with the idea that Putin is looking for a quick comeback to the negotiating table to resume sales of energy products to Europe. Even more, the act of sabotage breaks all ropes. What is there to negotiate at this point? Nothing. The Europeans will not get their gas back, and the Russians can’t sell their energy to Europe. A geopolitical escalation like no other, at least in the lifetime of the author. Goodbye diplomacy! At this point Europe is left with no good choices- and it is forced to adopt a strong “I will not be bullied” stance against Russia, entering into the anti-diplomatic trap that is war, and directing weaponry and finances towards Ukraine.
Enter Uncle Sam
Enter Uncle Sam. As the mass media allocates blame to Russia, the US stands victorious in the shadows. Maybe. But seriously, who has wanted Germany, and more widely Europe, to cut economic and political ties with Russia? Who opposed Nord Stream for so long? Who is now to benefit from selling energy products to Europe? Yup, it’s the USA.
The Russians could well be behind this act of sabotage, but it’s hard not to at least consider alternative scenarios- ones not recited via daily TV programming. If it indeed the US intervening in European affairs, it wouldn’t be a new affair, but rather another episode aiming to steer the narrative elsewhere- with huge implications for Europe’s long-term energy security interests.
If Russia had committed sabotage, then it means the Russian leadership doesn’t really care about sales to Europe. It’d mean too that it’s ready to shift energy sales to China and India and the “Rest of the World”. Bollocks! It’s simply not possible; the infrastructure to do so is non-existent, and nor is the rest of the world able to take in that energy once the infrastructure is built one day in the future. The Russians certainly care about their European customers, and they mean business more than anything. They wouldn’t, at any cost, risk damaging the pipeline infrastructure, delaying indefinitely the ability to deliver gas directly to Europe.
Poor Old Europe
Dark clouds are descending over Europe. While the media makes a fuss over this winter, the real issue is Winter 2023. Europe will likely enter Winter 2023 with much less energy reserves relative to its near-full current reserves. And one year is not nearly enough time to build pipelines across the Atlantic to the USA, or build alternative energy infrastructure from wind-farms to solar.. All while still resolutely sticking to the European stance against coal and nuclear energy. The likely outcome: German industry will suffer, European governments will subsidize energy so that the consumer’s bill doesn’t triple/quadruple, and governments will be more and more squeezed financially into a spiral of debt. Meanwhile, please stay away from European government bonds! And, goes without saying, the Euro! On a more positive note, it’s time to go to Europe, where, this time around, you’ll get a real bang for your buck.
Check our other article about Ukraine crisis here