by Jorge Vilches for the Saker Blog
The title is correct, no mistakes. And, of course, there will be “no fuels for Europe” none at all… but only if you care to believe the EU leadership when insisting that by December 2022 no seaborne Russian crude oil will evermore be imported. Thusly — if that were the case as the EU approved policy requires — then of course true enough there would certainly be ´no fuels for Europe´ because the EU will necessarily fail in its nonsensical attempt to import and duly process any significant amount of 100% Europe-viable non-Russian oil to substitute for a most successful and traditional Urals blend per the Russian oil ban by December 2022. The same would apply for all the distillates thereof (diesel, petrol, kerosene, aviation fuels, etc.) per an equivalent Russian petroleum products ban by February 2023.
But if, on the contrary, you and I don´t believe for a minute such EU committed nonsense that in 6 short months… or 6 years… Europe will succeed in any meaningful application of its Russian sanctions package No. 6, then consequently of course there will definitely be plenty of fuels available in Europe thanks to the illegal import of traditional Russian oil for a long time to come through third-party “triangulation” as detailed below. Clear enough? If not, it would not be due to this explanation herein but rather because of the forever circumvoluted EU logic always confusing absolutely everything even whether 2 + 2 really really equals 4 or rather “we shall see that later and vote on it…but not now”…
K.I.S.S. (Keep It Simple Stupid)
In other words, the EU insists that as of December 2022 — in six short months — per sanctions package No. 6 seaborne Russian oil would be successfully banned throughout Europe and substituted with European-viable non-Russian oil and distillates from elsewhere. This will be impossible for reasons already explained to death and in-depth in a half dozen previous articles referenced below. So Europe will not be able to successfully substitute Russian oil and will just keep on buying and paying for it but through EU-illegal “below the counter” deliveries disguised in many old & dirty ways by third parties well-known the world over and especially by Europeans. Such “triangulation” ends up being terribly expensive and risky for Europe, thus the real effective result of the EU´s sanction package No.6 is a complete miserable failure fully against European best interests which EU leaders are unable to think of or care about. Hereinafter I make my case for the corresponding complete effective title of this article as we´ll have ´no (European-viable non-Russian) fuels for Europe´ but instead will have “plenty of (EU-illegal) Russian fuels for Europe”.
It´s short & sweet. TINA. There Is No Alternative to Russian energy. Please do read Mike Shedlock´s article this week
Ref #1 https://mishtalk.com/economics/the-harsh-reality-of-energy-tina-strikes-the-us-and-europe
The Wall Street Journal reports that fuel shortage has shut down European factories with more coming soon. So whatever the EU does now or may do in the future – still up for grabs, nothing cast in concrete yet — the end-game cannot possibly include any significant EU substitution of Russian oil or nat-gas for that matter. Simply put, even if the EU were able to (very poorly) substitute a small portion of Russian seaborne oil (5 % ?) while exporting less Russia would still collect even higher revenue than today. This most valid and already proven consequence defeats the very purpose of the EU´s sanction package No.6. The reason is that by withdrawing any amount of Russian oil from today´s ultra-tight world markets, the price immediately increases proportionally or even beyond due to very sensitive price expectations derived from the smaller number of remaining willing and able vendors which might not even fully satisfy such newly created world oil market deficit. Thus the supply side of the world´s oil price equation rapidly deteriorates to the point of not being sustainable for more than a few days. While crude oil has many petrochemical applications, fuels are mostly destined to transport and heating, something that Europeans will soon have far less of.
the EU plan (not)
What is at stake is terrible, and no room for misunderstandings here, so let´s get this straight from the get-go: the EU´s “non-plan” to ban Russia´s crude oil and refined products thereof is as improvised as it sounds. For example, this “non-plan” does not include a single word about how the EU will effectively replace the abundant processed and finished oil products and distillates also currently imported from Russia. Would it be from Über-European productivity to be obtained from EU refineries after full modification for processing non-Russian oils? Or maybe through massive additional imports from yet unknown non-Russian sources? If a high school teenager were to submit this EU ´plan´ for teacher´s approval, at least in my 1960s it would have been immediately rejected, I kid you not. Been there, done that, got the T-shirt. Below please find the main points of this EU nonsense about which we only get piecemeal excerpts.
- until December 2022 Russia would continue exporting normally to Europe as it always has, meaning that for many months Russia would still happily cash-in copious amounts of euros per EU oil-sales revenue most probably with yet higher oil prices induced on the market by this very precise EU “plan” (not) described herein. This includes post-Covid and peak summer tourist consumption of diesel, petrol/gasoline, and aviation fuel.
- until December 2022 the EU would (supposedly) have enough time…only 6 months…to find and pre-select vendors, call for and much later study bids & lab tests, certify, negotiate, award and enter into 30 to 50-year contracts which better be fully complied with by yet unknown brand new international crude oil vendors (who are they, why not known yet ?) necessarily duly compatible with existing refineries and processing plants and other European requirements while simultaneously and successfully reaching legal agreement amongst 27 very diverse and conflicting EU stakeholders regarding design, tender, evaluation and award of contracts and oversight of the building, re-tooling, upgrade, testing, permitting and commissioning of a most important percentage of key European chemical industries and fuel trade businesses to be briefly described later herein and about which nothing has yet been said. This alone would take many years to approve and execute, yet EU politicians just smile solemnly and stare at MSM cameras same as a cat would after gulping down a canary. Matching the Russian Urals oil grade is theoretically “possible” by blending oils from different sources if available in reliable and large enough quantities. BUT achieving the blend specifications and volumetric physical flow requirements to meet refinery required output vis-á-vis desired final product specs is very difficult
- by December 2022 and thereafter all procurement processes for new Europe-compatible non-Russian feedstock oils would be concluded and contracts in full effect with tankers all lined up with shipments ready and waiting to be unloaded. Exactly the same applies to the many modified port, docks, land structures, and systems – just think HR recruiting & training + IT requirements — with their new logistics packages (supposedly) in place and tested to adequately deliver to the corresponding refineries, processing plants, pipelines, storage facilities, etc. throughout Europe. Of course, all of this should sound to you either childish and/or mission impossible simply because it´s both. And, of course, with so many (hundreds) of widespread and disruptive unplanned overlapping projects throughout Europe necessarily both “schedule slippage” and “mission creep” will rear their ugly heads, okay?
Of course, other very pertinent and required modifications, revamping, retro-fitting, retooling, adaptation, tuning, and matching to the new feedstock oils also need to be finished by December 2022 at refineries, processing plants, and pipelines themselves to render the required production yields (quantities and qualities) of the refined and/or processed products. Simply a 6-month nightmare for which 6 years would not be long enough. This should include – although not limited to – all sorts of matters related to civil works, electromechanical contracts, retro-fitting of equipment, HR + IT, new processes with detailed engineering plans, specs & drawings, manufacturing of parts, shipping, installation, testing, commissioning and permitting. And every single European plant and piece of equipment modified at the very same time and with the very same deadline complying with EU environmental laws & regulations + European Green Deal + European Climate Law + legally binding 55% reduction net greenhouse gas emissions + ISO 9000 + ISO 14000 + other ISO norms heavily affecting urbanized and politicized areas and pristine environments with hills, valleys and ridges, forests, rivers, lakes, autochthonous birds, flora and fauna and wildlife at large with possible heavy rain and/or winds and/or snow depending on geographical area and season.
Seaborne crude oil delivery to the EU has many ports, and as important as some of them are (Rotterdam, Maasvalakte, Trieste, etc.) it´d actually be the closest ports to Russia that prove the EU dead wrong, namely Wilhelmshaven (Germany, North Sea) + Rostock (Germany, Baltic) + Gdansk (Poland, Baltic) and also Rosenets- Burgas (Bulgaria, Black Sea). Their modifications and readiness (or not) will actually be the key progress indicators if any. As explained in previous articles referenced below these ports need to perform un-replaceable functions without which right off the bat it´d be impossible for the many projects that depend upon them to get to first base. Furthermore, once their respective modifications are (supposedly) certified, the three of them need to coordinate their operation very smoothly like a perfect trio ensemble for Northern Europe to have chances of importing huge & continuous amounts of Europe-viable non-Russian crude oils. These three ports (Wilhelmshaven , Rostock, and Gdansk) are also what engineers call “single points of failure” which, in this case, is even worse as the three are located way upstream in the supply chain meaning that if any one of them does not perform as planned, farewell bye-bye adios sayonara to German and Polish fuel production and distribution. Such negative impact could also be expanded elsewhere in the event that Slovakia´s huge Slovnaft refinery – or Burgas the largest refinery in the Balkans plus many others — cannot overcome the terrible new problems that these EU policies with nonsensical Russian oil sanctions now mean very specifically for them by also not allowing any ´direct or indirect´ EU transfers or exports anywhere. The No.6 sanctions package will probably fail in and East of Germany. Furthermore, as Poles and Germans don´t always get along well, the Old Continent would not be as we know it with Germany, Poland, and possibly all of Eastern Europe short of or plain cut off from fuels, no? I can´t believe there are no sane knowledgeable Europeans able to stop this.
Ref #2 https://www.lw.com/thoughtLeadership/Sanctions-Update-EU-Expands-Sanctions-and-Export-Controls-Relating-to-Russia-and-Belarus
As a matter of fact, if that ever happened the EU as such would de facto cease to economically exist right there and then. Schedule compliance and meeting Critical Path key dates shall be unforgiving as European engineers surely must know, let´s hope. Even a partial failure would be unbelievably catastrophic by shutting down continuous year-round processes which cannot be re-started and would mean irreparable economic harm and possible human injuries.
Ref #3 https://thesaker.is/germans-schwedt-hard-for-russian-oil/
Ref #4 https://www.visualcapitalist.com/mapped-which-ports-are-receiving-the-most-russian-fossil-fuel-shipments/
- by December 2022 and thereabouts (supposedly) all around the European continent lots and lots of refineries, processing plants, facilities and premises of all sorts will all necessarily be either shut down with no production for weeks (!!!) thusly unimaginable chaos OR still producing normally while also attempting to incorporate new unvetted modifications, upgrades, and stuff to be commissioned. So it´d be like trying to change the oil of your car´s engine while cruising at 150 km/h speed on a German autobahn without ever stopping. Got it?
I wonder where the arch-famous EU labor unions and industry trade associations are hiding right now ? Have all of them been “captured” by the EU establishment same as MSM? Not a word from anyone as if all of the above (and more) were just business as usual so “what-you-worry-for ?” stuff. No Sir, quite the opposite.
- after December 2022 – and this is important – from one minute to the other ( how so, exactly ?? ) the EU would switch over and no longer import seaborne Russian oil suddenly replaced by (supposedly) 100% European-viable fully lab-tested non-Russian continuously abundant certified quality oils to be imported from still unknown far away vendors, not from neighboring Russia. It better be that way, or else Europe would be crashing a Boeing 737 Max in automatic pilot mode into the French Alps same as Germanwings Flight 9525.
- the sudden January 2023 switch-over mentioned above also assumes that every single modification required to accept such 100% European-viable non-Russian oils would have already been successfully made and certified, permitted, and commissioned in full compliance with EU policies and norms briefly described later herein, and with no negative impact or alteration of any significance in other ports, docks, handling & storage facilities, the environment at large, pipelines, heavy-duty and heavy-traffic roads yet to be built, public domains, logistics infrastructure, trucks, yards, refineries and processing plants, shipping facilities and premises, etc.
- as of January 2023, Russia would (supposedly) no longer export just about any of its oil per EU sanctions package No. 6 forbidding financing, insurance, and reinsurance of Russian oil in transit anywhere in the world.
- As of January 2023, Russia supposedly would not possibly retaliate in any way, shape, or form – as if forcefully isolated and tied down inside a high-security “vacuum jail” of sorts. Of course, Russia does not agree with the above and will surely act in self-defense, possibly with harsh retaliation measures fully unexpected by the Western world as described to death and in-depth in the articles referenced below. So EU politicians believe that the Russians are dumb enough to let them roll their ideas out nice and easy at their own pace and whenever they decide to act per their own special EU schedule, with no on-the-fly Russian reactions. No market dynamics involved either as Europe plays everybody else´s pieces too as grandpas would do with 3-year-old grandkids. Furthermore, there are key imports Russia could partially or totally embargo such as strategic value-chain upstream items with captive EU consumers cascading into multiple supply chain failures thru lack of nat-gas, rare earths, inert gases, potash, sulfur, uranium, palladium, vanadium, cobalt, coke, titanium, nickel, lithium, etc. Ref #5 https://www.rt.com/business/555065-russia-oil-ban-exemption-eu/
- as of January 2023, Russia would find itself basically deprived of its oil-exporting revenue worldwide no matter how high the oil price ends up being after shrinking the world market supply by some 15% of Russian oil now all “hijacked” within Russia´s borders and (supposedly) forcing to shut-in entire Russian oil fields thusly damaged beyond repair thereafter hindering any possible future Russian production of oil. (!!!) Amen.
The above points are of course per the theoretical EU ´non-plan´ that will never happen for reasons that should be obvious by now. What follows immediately below is what really will (approximately) happen and for which the EU leadership — under normal conditions at least – would have to pay an enormous political price for, such as collectively resigning to their positions or completely re-designing the EU-Russia relationship on the basis of the Minsk 2 Agreements it never followed and/or forced Ukraine to comply with despite the French & German leadership thereof.
Per The Guardian, “…Come October, it’s going to get horrific, truly horrific…a scale beyond what we can deal with”.
Ref #6 https://www.theguardian.com/business/2022/apr/19/energy-chiefs-fear-40-of-britons-could-fall-into-fuel-poverty-in-truly-horrific-winter
De-Russianizing Russian oil
“Triangulation” means Europe will necessarily keep importing high-quality Russian oil via third countries only at much higher prices. One way to cheat about it having Russian oil staying in some other country´s depot for a short while and thus being “nationalized” on such other country´s behalf and is no longer considered to be ´Russian´. Or, by preparing partial mixtures anywhere – even on high seas — of Russian oil 45% + 55% ´oil from somewhere else´ so as to make the Russian oil DNA untraceable but yet with the “correct” pre-agreed 55% blended in already, you follow? Such old, quick and dirty business is known as “triangulation” and may also involve STS or Ship To Ship high seas transfers. But through every (faked) transaction the price of such de-Russianized oil would increase thus reaching even a 50% surcharge over the original international price paid to Russian suppliers, even discounted. Rinse, repeat.
Accordingly, Made-In-Europe costs and cost of living inflation would rise enormously. Of course, the West would still import lots of badly-needed Russian oil – most especially the US – predominantly from India. In recent months there have been 180 (one hundred and eighty) ownership changes of Russian vessels to firms based mostly in Singapore, Turkey, the United Arab Emirates, etc. Other ´deceptive´ shipping practices are increasing every day with yet more creative shenanigans.
Ref #7 https://www.cnbc.com/2022/06/02/how-russia-could-try-to-get-around-the-european-unions-oil-sanctions.html
Ref #8 https://www.fastcompany.com/90760216/the-u-s-is-still-importing-russian-oil-despite-the-ban-report-says
For example, tankers would switch off their GPS equipment, known as ´going dark´, and carry out STS maneuvers by transporting labeled Russian oil a very short distance to a large vessel at sea and then transferring it yet again before final delivery, all the de-Russianizing done “on the move” even at night with no possible satellite or drone surveillance.
Another clear possibility is cheating and corruption all along the very lengthy Druzbha pipeline all the way from Russia into the heart of Europe feeding refineries such as Schwedt, Slovnaft, Burgas, Litvinov, Duna, Leuna, Plock + others
no news is bad news
Supposedly, per EU sanctions, by December 2022 Europe would not be importing any seaborne Russian oil. Supposedly, in 6-month’s time, the EU would be importing Europe-viable non-Russian oils to substitute for Russian oil.
But in order for the above to happen, lots of things should already be known, alive and kicking, “puffing smoke” so to say. And they are not while 800 million livelihoods plus many hundreds of billions of euros are at stake. Lots of stuff should have already taken place with great visibility and participation from stakeholders. We have none of that though.
8 broad areas 8
Everything that is explained herein below is an absolute requirement right now, not in 6-month’s time. The pre-selection of many dozens of bidders plus the corresponding issuance of bid documents, calls for tender, bid opening + evaluation & homologation + negotiation & contract award processes are still fully unknown. Also missing are plans, drawings, and specs, dates and schedules, possible joint-ventures & engineering firms involved, bid evaluation and bid award authorities, etc., etc. So all items mentioned below are either (a) an unexplainable secret or (b) do not exist.
- Feasibility studies: contract & execution + corresponding Reports
- Legal basis for Project Owner´s appointment & Regulator´s base-line Reports
- Financing plans with 50 years pay-back period long after fossil fuels are phased out of the EU.
- Crude oil data & specs, quality, quantities, guarantees, vendor qualifications, contract length, schedule, terms
- Shipping tanker contract terms, insurance, and reinsurance of vessels, cargos and ports, docks & facilities
- Bids for new infrastructure and modifications of existing infrastructure, civil works + electromechanical contract
- Bids for refinery and/or processing plant modifications and retro-fitting, detailed engineering plans, specs & drawings, manufacturing of parts, shipping, installation, testing, certification, commissioning, and permitting. Negotiation + contracts. All plants and equipment simultaneously modified and with the very same deadline.
- Projects oversight, progress and certification plus overall compliance re EU labor legislation, environmental laws & regulations + European Green Deal + European Climate Law + legally binding 55% reduction net greenhouse gas emissions+ ISO 9000 (manufacturing ) + ISO 14000 (environment) + other ISO & EU norms
- On what EU legal basis would a “Bid Authority” evaluate the quality and validity of the bids?
- Who and how would later negotiate the corresponding contracts?
- Would there also be a Panel of Consultants for oversight purposes?
Hundreds of projects need to be executed if all refineries, processing plants, ports, pipelines, logistics infrastructure, etc., etc. are taken into account. There are many vulnerable refineries now fed by the Russian Druzbha pipeline such as Slovnaft + Burgas + Litvinov + Duna + Leuna + Plock + others – that need to overcome the specific impact of these EU negative policies including export prohibition (!!) Just as an example, for processing and refining non-Russian crude oil the Schwedt refinery alone at the very least will require 11 major projects summarized as follows:
- Wilhelmshaven + Gdansk: dedicated storage + equipment for frequent inbound seaborne batch deliveries
- Wilhelmshaven + Gdansk: dedicated logistics for outbound deliveries to Rostock port storage terminals
- Rostock: berth revamping for larger seaborne inbound oil tankers from Wilhelmshaven, Gdansk or elsewhere
- Rostock: dedicated storage facilities + handling equipment for larger, more frequent seaborne batches
- Logistics for internal delivery via inland waterways + rail + road inbound to both W. + R. storage terminals
- Rostock port – Schwedt Refinery: pipeline upgrade & revamping + modifications to receive Rostock feed
- Schwedt Refinery: new oil feedstock definition, testing and vendor selection, approval, certification & contract.
- Schwedt Refinery: retrofit and revamping modifications per Option (3) described herein later.
- Schwedt Refinery: enhanced storage facilities + handling equipment for large deliveries from wherever
So even assuming that eleven simultaneous Schwedt projects may possibly produce partial although much lower rate substitutes, it´d always be at a MUCH higher price plus the enormous cost of paying back these unnecessary projects which will require lots of negotiation, coordination, funding, expertise, risky modifications, new fixed and variable costs and surprises from yet unknown trade and business partners, new procedures, brokers, insurance companies, etc., etc.
And remember, no (or less) Schwedt means no (or less) Berlin, same as Brandenburg state and all of Western Poland
Schwedt needs fine-tuning revamping of everything related to new feedstock lines and infrastructure, an atmospheric distillation facility, a vacuum distillation system, a cat-crack unit, a visbreaking facility, an alkylation unit, a catalytic reformer, an isomerization unit, and an ethyl tertiary butyl ether (ETBE) facility. Plus brand new storage facilities + handling equipment for Rostock feed to substitute the Druzhba pipeline. Contractors and third parties working everywhere with all sorts of sensors, software & firmware modifications or possible purchases of new hard & software.
Other refineries will be actively competing with Schwedt, among other resources, for the required expertise and experienced, specialized hands-on labor and other specific tooling and equipment, specialized vendors, etc. etc.
Ref #9 https://thesaker.is/germans-schwedt-hard-for-russian-oil/
Ref #10 https://thesaker.is/dear-ursula-you-are-dead-wrong/
“ Europe will spend a fortune it does not have while simultaneously risking project non-performance of the trouble full reconversion projects required ending up with many half-finished facilities that will not be anywhere ready on time, or ever. And as 95% compliance is not enough to produce a single drop of a processed product (diesel or whatever) this means that under current circumstances and 2022 established deadlines until Europe has 100% modified, re-tooled, and retrofitted facilities up and running you really have not achieved anything. Additionally, the human resources challenge related to all of the above is insurmountable and probably un-compliable.”
Politicians do not comprehend the language and requirements of engineering, physics, chemistry, logistics & geology.
And it´s still an unfathomable mystery how the EU will effectively replace the abundant processed and finished oil products and distillates also currently imported from Russia. Not a single official word has been uttered by the EU.
Ref #11 https://www.rt.com/business/556600-analysts-warning-russian-oil-embargo/
Ref #12 http://thesaker.is/pitchforks-soon-in-europe/
Ref #13 https://thesaker.is/for-europe-from-russia-with-love/
Ref #14 https://thesaker.is/europe-now-cheats-or-suffers/
Ref #15 https://thesaker.is/why-russias-oil-ban-is-impossible/
Ref #16 https://thesaker.is/europes-mad-ban-on-russian-oil/
Ref #17 https://thesaker.is/russia-has-a-plan-the-west-does-not/
Ref #18 https://thesaker.is/a-west-mandated-russian-default-who-wins-and-who-loses/
Ref #19 https://www.freightwaves.com/news/as-diesel-prices-soar-past-crude-refining-squeeze-challenges-oil-markets
The US controls Europe through NATO. That is it’s sole purpose.
Forgot Yugoslavia, Afghanistan, Iraq, Libya?
Just now, the US and NATO are purposely threatening China and fomenting Freedom and Democracy in the Indo-Pacific.
Jorge Vilches asked me to let the commentators know that he is engaged with a family commitment and will join the discussion when he is able.
amarynth, of course I true that. Yes, what you say is 100% correct and I try to explain myself further in my “APOLOGIES” post waaay below. Thank you Amarynth. Cordially Jorge
the much touted Qatari gas fields that Europe thinks they will easily get if they can build hundreds of huge tankers in a few months just was announced as a non starter.
seems china has been talking to their BRI partner for supply to close out the ever increasing hostile australia as the major gas field they will buy from. the “friendly ” win win things in life.
when reuters and oil price say so you know the big players have spoken.
To take that a little further, pablozz, ZeroHedge has applied some further analysis to that Reuters piece, and come up with (my emphasis on the 3 words);
“For Qatar, the deal would be part of a planned expansion of its gas presence in Asia, while for China, it would provide much-needed diversification away from its current top supplier, Australia, amid strained bilateral relations.
It would also give Beijing – AND THUS MOSCOW – a right of first refusal on any cargoes headed for Europe…”
This is so insane that the only logical conclusion can be that it’s deliberate.
We’ve had the scamdemic, we’re about to have famine, war, and rumor of war abounds: is it just me or are the four horsemen of the apocalypse up and riding?
The King of the North has just “Pushed Back”, different book, same eventual outcome.
it all appears to be logical in another context –
that is if everyone is paid off for each position of authority no matter whether political or technical – which means they get paid even if failure occurs – forever –
then they get a call – told what to do or say and they say …fine even -if up is down or high is really low – it does not matter – take the order and if a building burns down because you were told to put a match to it – you did your duty
if someone dies because you turned a a dial, knob, switch – that is fine because you did what you were told.
at the end of the week you take off for a lake or beach somewhere – spend time then come back and there is chaos but that is expected …….so you do it again………..and again
It isn’t. I work on massive projects, including in the oil and gas industry. This is people who’ve never had a real job being disconnected with reality. The decision makers at the EU don’t know or care about many of the project planning and execution details Jorge has detailed so well in this series. Many of those details are why you read about big projects developers or politicians promised by such and such date with such and such budget will meet neither.
The leader/money source start by hiring a consultant who tells them what they want to hear to get approval. Everything is done on best case scenario planning because the consultant isn’t a technical consultant. Those come later (like me) and we have to start telling people about reality.
Contrary to popular belief amongst politicians and investors, the actual contractors bidding on these jobs won’t kill each other for it and drive the price down. I’m involved in a $1B infrastructure project and only one general contractor even bothered submitting a bid. I happen to know that prepping the bid incurred a cost of almost $250K. These contractors then bring more reality to the discussion. Or at least reinforce what people like me tried to explain to the smooth talkers in charge.
But almost never are projects of this sort of scale done on such a tight timeline with zero room for error. Certainly not in an environment where individual small components may not even be available by the time the whole things needs to be completed simply because the world wide supply chain is tangled. I mean, the lead time on a washing machine is in months. I don’t think an alyky or cracker is just going to magically appear; those were long lead time items when everything worked.
This is the same mess as every infrastructure or major construction/demolition project I’ve ever been involved with for all the same reasons, except the scale is orders of magnitude bigger, more complex and draped in the finery of impossible expectations beyond what I’m accustomed to. I wouldn’t get involved with any of these projects beyond the level of supplying field support during actual construction. Every firm involved upstream of that effort level will lose its ass and be crushed by the unrealistic expectations of politicians who will be fighting for their political lives by the time the specifications are written.
Hi Lex, nice meeting you again right here Sir. As you may know, I´ve been ´socially´ busy lately with most important family events (!!!) so I just happened to read your post only a few minutes ago. Otherwise I would have replied to you earlier Lex.
I also find it easier to reply to posts placed at the very END of the thread, not at the very beginning just like this one, which is something that you can´t help avoiding I know that and for which there is no easy solution.
For reasons of speed and simplicity, what I first do is to check out new comments from posters starting by the very END of the thread which would be the latest comments .. unless, like in this instance, you were replying to another poster who commented wherever way at the top… or in the middle of the thread. And those are really hard to find because I never seem to be able to get there soon enough whether I start from the very TOP like right now or the very END like I usually do !!
That said, of course, I agree with you 100% Lex and furthermore thought of explaining right here and very briefly something of interest related to bids.
We all may think — or are persuaded to think — that international pre-selected contractors are bidding on these jobs ´to kill each other for it and drive the price down´, right ? Wrong. What they many times do is hold a separate PRIVATE bidding process between pre-selected bidders ( so the lowest price pretty much necessarily wins, can´t avoid the pre-selected lowest bidder, can you ?) BEFORE the real effective bid opening ceremony whereby they secretly bid amongst themselves the amount that they are willing to pay every other bidder to LOSE the bid.
So, for example, BEFORE the real-life bid opening the 6 (six) already pre-selected bidders hold a secret meeting whereby in a closed envelope (later to be opened) bidder No.3 “wins” by bidding to pay all other 5 remaining bidders the highest comparative amount ( higher than all others) so that everybody else´s OFFICIAL bid is pre-arranged to be HIGHER than what the No.3 OFFICIAL bid would be, so No.3 would be the lowest OFFICIAL bid although always adding XX for all the other co-bidders… So, it´d be all pre-arranged in a PRIVATE bid held before the real bid opening whereby a “winner” buys out every other bidder…
And then No.3 bidder gets the contract awarded and later adds revenue through also pre-arranged claims and “contract additionals” and deviations etc etc with the Owner´s consent. So in the end it´s all politically influenced and payed out for.
All of this is for one elephant in the Room, not mentioned in the lede – NATO.
In other words hapless civies are paying at the pump for an outfit they never would serve.
As a German General recently remarked – whey should anyone listen the Greens – they are all armed service deniers, pushing weapons to the front.
It is quite simple to solve this mess, non-arithmetically.
Macron should do a DeGaulle – send NATO packing again as in 1963.
A Win-Win – he steals lePen’s support immediately, becomes the hero. A nod-nod wink-wink to Scholz seals the deal! Russia invites them to the Kremlin, short table.
Britain’s BoJo Partygate would look like a tea-party!
Remember AUKUS – when Britain stole France’s sub deal?
Macron for sure has not forgotten.
Macron, Scholz, Draghi and Johannis met Zelensky, BoJo not there.
So what was he doing in Kiev the following day… promising UK army support.. establishing bases…as Z only hears what he wants to hear. bojo undone yesterdays visit by the EU numpties…. hmm??
Looks like BoJo is alone pushing more war – even D.C. wants Jaw-Jaw, along with the Trio.
Something big is going to happen sooner or later. The only thing left is commonsense. So you could be right, brain dead NATO is first, then brain dead EU next, while drag queen America has a tizzy fit.
Putin will be blamed for everything and Ukraine will go down in history as the real game changer.
Great in depth analisys of why everything coming out of european union is pure wishfull thinking without any basis on reality whatsoever.
They are gonna cheat and keep consuming russian oil bought at premium prices from their corrupt revolving friends.
They will use and abuse zenos paradox in mixing oil barrels version. if you start with 1001 barrels non russian oil and you mix it with 1000 russian, the end result will be 2001 e.u. approved non russian oil, which you can mix anew with 2000 russian barrrels to get 4001 eu approved non russian oil.
Add to that win-win, Hydrogen, H2, at the right step and presto! Blue Oil.
Next question for von der Leyen?
The only remaining problem is AddBlue for diesels.
And just where are we supposed to obtain the Hydrogen ?
It does not exist as a gas in the atmosphere.
The only way to produce it in bulk is by electrolysis of water to create Hydrogen and Oxygen.
And where will the necessary DC current come from ?
Believe it or not H2 is already an additive to gas, and they use the “excess” green energy for electrolysis.
I heard NC has a big project to much more of this…
You could not make this stuff up!
When green H2 is added you get Blue Gas. Makes sense in a Harry Potter kind of way :-)
Ethanol C2H5OH produced from corn is added to US gasoline, that reduces gas mileage.
anodinous, thanks for favorable comments and excellent example of zenos paradox ! Cordially Jorge
Sorry Jorge, great in depth analysis but I need to get some work done. None of it matters cuz Europeans don’t need carbon based fuels cuz they have the wind and sun and even rivers to harness energy. For the sake of the planet they are prepared to make whatever sacrifices it takes. Putin is only giving them more incentive. And besides the shelves can be filled with stuff from China. And who needs jobs when you have a universal basic income and an endless money printing machine. Putin is proving himself to be a real grinch threatening to put an end to financial alchemy. Enjoy your stay wherever you are.
Ray m. It is not possible to manufacture solar panels, wind turbines or nuclear power plants without fossil energy. Fossil fuels are a finite resource that will be gone by the end of this century. Rather than think in terms of fossil fuels OR ‘renewables’, you should think about how humanity with live without neither. ps. I put ‘renewables’ in inverted comas because they don’t have the capacity to renew themselves. They are products of a fossil fuel industrial age.
You’re absolutely correct. Someday wild eyed and wild haired children will go to cities to play with no idea how any of it was built or who did it. I, as a teacher of Youthbuild in the US was swept up in the first Green New Deal Scam. All Obama’s green deal did was replace union carpenters with Green apprentices, who were all former felons. One master carpenter on a job, three morons would replace a regular union carpenter. These punks wouldn’t even show up for work. Obama is a crook, you realize that, right?
I vote for Tesla tower power coming to a neighbourhood near you.
Nice tongue in cheek from ray m.
Short term coal plants will be reopened. Long term more nuke plants will be built. There is far more money in them than renewables, so they will be the focus. Basic economics, follow the money.
Yep, in Britain we shutted our coal production during the Thatcher years. At that time, North Sea oil and gas was coming on stream and it was also cheaper to import our coal from overseas. This is now Britain’s strategic fossil energy reserve. Given a choice between keeping the lights on or climate change, voters will elect politicians who will promise the former every time. While the world population is increasing by 80 million per year there is no chance that any fossil fuels, that can be extracted at an energy profit, will be left in the ground, unburnt. World population will continue to increase till about 2050 and hit about 11 Billion. Net energy from all sources will have peaked by then and our energy descent will pick up speed, limiting further population growth.
…”I can´t believe there are no sane knowledgeable Europeans able to stop this.”…, well just like the Hippocratic Oath the medical doctors once took, “first do no harm”, rejected, that mentality also seems to have taken hold of these imbeciles in the EU.
These are dunces of epic proportions, like most western so called elite, especially of the G-7 crowd.
Marcellus cheers to you, thanks for the input and encouragement. Cordially Jorge
The US military industrial political banking media complex is out to collapse Western Europe. Eastern Europe will be just fine, for the time being. Energy and resources are what count together with the ability and the will to defend them from external maruarders. For non energy producer nations the inevitable energy descent post oil and gas peak was always going to be traumatic, however I didn’t expect Western Europe to voluntarily bring this forward in time by a decade or so by excluding energy and other crucial resources from Eastern Europe.
Around 2050 we will see peak population of about 11 Billion. I expect the US and Russia to be the last two nations standing as the World’s energy descent gathers pace post 2050 towards its inevitable post industrial, post fossil energy destiny.
The US will have collapsed long before 2050. Civil war is imminent. The country is a cesspool of poverty and corruption where people are most uniformly poor but surrouded by constant reminders of unattainable wealth.
Black Cloud, I don’t disagree with you but don’t underestimate the US ability to collapse other nations before their own. The US military expenditure is higher than the rest of the world put together. Their plan is quite transparent, destabilise the Middle East, now Western Europe is getting the same treatment and China will their next target.
The USA will be lucky to make it to 2024. Putin and Russia killed the petro dollar. I do not think Putin wanted to but he is pretty fed up with the WEF-Soros-Nuland-NWO-Khazarian Mafia criminals.
Countries as far away as Pakistan blame Europe , not Russia, when the lights go out:
Europe’s Plan to Quit Russian Fuel Plunges Pakistan Into Darkness
So, soon I’ll visit the “ancient” ruins of Paris, Berlin, Amsterdam, like I visited the ruins of Egypt years ago. European peasants begging on the streets, professors selling pencils, engineers offering maps of the “old city”. A fine sojourn…
14 billion liters per day !
This was the world oil consumption in 2015.
We knew that the reserves would no longer be enough for everyone, we knew that prices would rise a lot to curb consumption and that that would not be enough and that ultimately consumption would have to be limited to a controlled part of the world’s population.
We knew that if we didn’t change anything, we would have to learn to live without oil by 2070.
However, modern man does not know how to live without oil. He depends entirely on this non-renewable fossil material for transport, for health (medicines), for crops (petrochemical fertilizer), for clothing, for communications, etc.
We knew, they knew !? So let’s not be surprised by this great staging, the goal is obviously to select who can live as before and who can’t.
The ’70’s Peak Oil was bunk. The price hike then was a Sir Henry Kissinger prank.
There is an ocean of oil and gas, no problem whatsoever, except for Greta who can actually see CO2 !
Prices today have nothing whatsoever to do with supply and demand, only idiotic politics.
US conventional oil extraction peaked in 70s. The recent increase of US oil production was from unconventional sources with poor net energy return. Hence, since the 70s we have seen the hollowing out of US society, a huge increase in inequality and the issuance of massive debt. This debt will be defaulted on or devalued via inflation eventually to match the underlying resource base.
Oh they will learn to live with much less oil and natural gas than before, the U.S. will have to put in rapid transect systems to remove the cars and trucks from the highway, they are using way too much fertilizer anyway the ground is becoming saturated with it, at the local high school they have signs over every drinking fountain warning students not to drink the water because It’s loaded with phosphorous, and we would all be better off to remove business from the government, so there is always a plus to any situation.
Love it Jorge. LMAO! Maybe somebody in Europe with more than two brain cells will come across one of your pieces, fail to avert their eyes, and accidentally read it . . .
Meanwhile, although Finland has proudly refused to buy Russian pipeline gas–won’t pay in rubles, you see–it continues to buy vast amounts of (oops, RUSSIAN) LNG from the (oops, Russians):
NOVATEK continues to supply liquefied natural gas to Finland. This was announced by the head of the company Leonid Mikhelson [the NOVATEK Chairman] at a briefing during the St. Petersburg International Economic Forum (SPIEF).
According to Michelson, Finland has abandoned pipeline gas, but continues to buy liquefied natural gas from the Cryogas-Vysotsk plant [Cryogas-Vysotsk is located in the port of Vysotsk in the Leningrad region].
“Finland said that we will not buy from the pipe, but we will buy LNG. Officially said so. Loading is higher than the design capacity, because we sell everything we have, ” Mikhelson explained (quoted by RIA Novosti).
pasha, I can attest that some influential European Parliament members see the problem and are trying to change things. We shall see… I am glad you enjoyed this article. Thanks for telling me. Cordially Jorge
what could be even more fatal–if possible-suppose a whole lotta work is done(highly unlikely to be fully coordinated on one project let alone many) then they find out is does not work…EU admits defeat….then it all has to be undone to go back to previous? Would take decades….? If ever? Start again.. cos cannot decontaminate from the “new” ?
JJ yes, true enough, as mentioned in passing in one of my “The Saker” articles, the only solution for Europe is to rewind black-pedaling right now. Rewinding later is another Catch-22 total chaos that even pitchforks would not solve. Cordially Jorge
JJ above I meant to say “BACK-pedaling”, sorry about typo, very bad typing skills here.
It’s fascinating to learn how interconnected our world has become. The lesson of guaranteeing your safety through NATO has been utterly discredited. Yes you are safe to fall into poverty so that arms manufacturers can flourish while giving Russia endless practice.
Even the funds we allow you to borrow are an illusion, as it’s value drops by the hour.
We have to stop elevating earning huge sums of money with competence. For God’s sake Bill Gates massive power and influence does not qualify him to run the world.
If we finally figure out we need Russia and they decide to turn off the spigot. What is plan B? 2)
frankly, that’s the problem, no plan B here. Cordially Jorge
Another succinct Masterpiece from one of my favourite storytellers.
Jorge, do you remember the advert for ‘The Man From Del Monte, He Say Yeah’ (please type in and you’ll get the 35 second old classic Advert ).
The Big Boss driving in his luxury car reaches one of his producers/suppliers orchards and picks up a ripe orange and squeezes it, nodding his head. In turn the owner of the orchard, a peasant , runs toward the field and shrieks in delight, informing his workers, ‘The Man from Del Monte, he says yeah’.
Well I substitute in your own findings regarding the technical aspects of oil and its many by-products and see a whole host of experienced refinery technicians across Europe who’ve been in the game for decades, dipping their wicks into substitute products and shaking their heads – ‘The Man from Glencore (the biggest marketers) he say NEIN’
Keep pushing Jorge
WTFUD as always, THANKS for your input and encouragement it keeps me going! !!! Bear hug from Jorge
Other nations are using those other oil blends, that means EU can refine those too. There’re thousands of politicians in Brussels, a few should have thought about these things don’t you think?
These days, most European politicians are high-school dropouts or “graduates” in non-fields such as “dramatics”, without any professional experience either, and do not understand as much as the difference between mineral oil and salad oil.
As one Green she-delegate said, “Then it’s time for the men to invent cars that do not need energy.” Simple enough, isn’t it?
Gaylord, I just loved your monosyllabic response “No”.
Yes, there are many thousands of politicians in Europe today, but it sure looks that thes non-professional improvised bunch of politicians would not solve much no ? Cordially Jorge
Other nations are using these blends because their refineries – the equipment which is used in them – and other associated facilities have been set up to use them via long term (30-50 years) supply contracts which supplies the blend the equipment has been set up to process.
What the engineer is pointing out here is that this is the same for Europe. All their refineries and the equipment which processes the oil has long been set up to to run and operate on that specific blend.
Why is this the case? Because of physics, chemistry etc.
The point being that as the engineer has consistently pointed out it-is-not-plug-and-play. The physics and chemistry do not work that way – no matter, to coin a well known film line, how many positive waves you generate Moriarity.
This is why the engineer has, on multiple occasions, spelled out in Janet and John terms that to use other blends requires all this expensive replacement and testing of equipment along with a guarantee of the same blend over the next 30-50 years and beyond. Not just to make the economics of switching viable but because the equipment won’t work unless its the right blend within a narrow set of parameters.
That’s why the engineer keeps putting the question of where will this required long term blend come from in a market which has seen a significant amount of product deliberately, criminally and insanely removed from the supply chain. Resulting in a sellers market as users try to acquire needs from a lower supply quantity (not to mention quality).
Again, this is determined and unchangeable as a result of physical and chemical realities which no ‘creating our own reality’ politician or commentator can wish away.
Some of us have been through similar iterations of this ideological nonsense over the majority of our working lives over the past four decades as a result of clueless management numpties – and politics is simply another branch of management (which should be relabeled ‘coping’ because that’s all they can manage). The quality of decision making all the way up the chain anywhere you go in the West – whether public/private, civilian or military – is worse than that depicted it the film “Idiocracy.”
I’ve had situations where people have been instructed by senior Rupert’s to smash up an operational gas main in an urban street; to work inefficiently because they are the manager and they say so; where component parts of organisational systems are set up to mutually undermine each other resulting in outcomes which are less, rather than more, than the sum of the parts (2+2=3 rather than 5); and a thousand and one other equally ridicules, dumb, unworkable nonsense’s.
And, no doubt Jorge, along with every other engineer out there who do know their backside from a hole in the ground – whatever their specialty – will have their own list of similar head exploding experiences they could spend all day relating..
Just because someone has a fancy title in a hierarchy means jack shit. Why do you think nothing works in the West anymore? Because, as Amdrei Martyanov keeps pointing out, the education system is not fit for purpose and expertise, experience, knowledge, and gumption have, over several generations, been managed out of every corner of every system, organisation and institution to be replaced by clueless sycophantic morons who couldn’t find their backside in a farting competition.
Anyone who seriously thinks politicians in Europe, UK, US, Canada, Australia or anywhere else in the West have the ability and nous to identify, never mind consider and deal with, the issues spelled out by the engineer here must have been asleep for the past four decades. Most of them don’t know what a women is and those that do are keeping their gob shut because that’s the way the wind is blowing and they are too cowardly to speak up in case they lose their cushy number.
Best to keep agreeing with whatever The Official Narrative (TON) is coming out of the infantile imaginations of the twelve year olds and their sycophants running the ship.
Right now nothing in the West is fixable via internal mechanisms. Its going tits up and the only viable option is to stock up, put on your tin helmet, and try to weather the coming unprecedented shit storm as Darwins Law does its work.
Dave Hansell, many / most of the things you say I could not have said them better myself. You have precisely summarized the nature of the problem and what´s really behind it. Thanks for your most valid input Dave. Cordially Jorge
James, yes, of course that other nations after decades of development have set themselves up to slowly refine non-Russian blends. And yes, eventually and very gradually, with lots of HUGE investments ( switching over 50-year contracts is not easy ) with LOTS of time and the right expertise — which does not necessarily readily exists RIGHT here and NOW for absolutely EVERYBODY in Europe today — and running lots of uncertain and unnecessary risks which would mean freezing and/or starving to death … yes, true enough James, some EU refineries might also end up being able to refine non-Russian blends.
But all of a sudden from one minute to the other with no prior plans, changing absolutely everything for ALL of Europe at the same time and with the same 6-months deadline ( NOT 6 years…) including crude oil vendors themselves that do not exist nor have the right blends in LARGE enough quantities to offer, tankers, sea routes, ports and docks and pipelines that require revamping / upgrading and refineries that require re-tooling & retro-fitting while they STILL continue refining, etc etc etc etc etc etc etc etc would be like trying to change the oil of your engine while cruising at 150 km/h on a German autobahn… You wouldn´t care to try that out and tell us how it all went, would you ? Cordially Jorge
Oh, james, obviously you haven’t payed attention, so i would say keep on watching TV
How rational Europeans are! The founding fathers of Rationality, of Reason! Wherever Nietzsche is, he’s belly laughing.
The problem I see is that politicians always anywhere need oversight. Europeans have allowed their political class to overrule whatever “reasoning” they might have by allowing them to hijack their basic needs and picking an unnecessary fight with their legitimate business associates and trade partners, namely Russia. The European political class mostly wants war with Russia while Europeans either don´t know about it or do not care. They shall pay the consequences though. Cordially Jorge
They deserve to freeze. Idiots.
I wouldn´t really agree in that Europeans “deserve” to freeze.
I´d say it´s the European political class that “deserves” to freeze.
Now then, I would agree with you in that Europeans are “idiots” in that they are allowing for the current leadership to rule them in these terms. Thusly, in that sense at least, Europeans would “deserve” what´s coming to them soon. Poor Europeans, they are all expressing their worst possible ´externality´ as millennials would have it. They should all be much better than that, me thinkxs
Nice going Jorge!
Whatever the EU does won’t be enough to make a difference as a cover for the impotence of the ECB to prevent a credit crisis. First they rolled out the response to covid, as cover to keep the expansion of money supply going exponentially.
Then there’s the renewed vigor and excitement by the propagandists to manufacture the “consent of the governed” to implement policies of the new religion: green-agenda-global-warming-climate-change. Green everything by 2030 or is that 2050? Just another pretext for more cover for the decline of hydrocarbons globally. And the latest pretext is sanctions. When all else fails blame everything on Russia.
Sanctions which attempt to destroy local EU demand for energy because the EU members states’ banks are insolvent, unable to pay for commodities unless U.S. dollar inflows enable creation of more bank credit in the EU, outside the US banking system, in the form of the Eurodollar market. That and more buying of debt by the ECB in the form of bonds to issue more currency into a perfect storm of rising interest rates and contraction of bank credit. In this end-game there can be only one result: the extinction of the Euro, and the disintegration of the Eurozone.
This is act one of the zero-sum game where the West loses and Russia wins.
The rising bond yields in both the EU and the U.S. are signaling the collapse of debt markets globally. The ECB had an “emergency meeting” last Wednesday to deploy “special tools to contain the Eurozone bond market fragmentation.”
Watch how both the Fed and the ECB try to manipulate the exploding bond yields lower in a vain attempt to stave off the inevitable, and buy a few more days or weeks, until they reverse course and hyperinflate to destruction, as their political masters stand by, powerless to stem the tide of debt defaults and social mayhem. The Japanese are already in the apocalypse as the articles posted here by Thorsten J. Pattberg attest. They just don’t know it yet.
Colin Miller, thank YOU for your input regarding the final financial impact of this all.
Both “green energy” madness, this “no Russian oil” madness are madness (insanity, stupidity, idiocy) for one reason – they are based on breaking laws of physics, albeit physics on a level a bit higher than high school level (when and where high schools were good). In high school we learn how electricity is made. We do not learn how entire system works and that we need all of them plants – nuclear, coal, various kinds of water powered plants – in order for the system (power plants, transmission grid, consumers) to work at all. Not the words ‘to work at all’. Role of each kind of plant and each individual plant is defined by laws of physics, which are taught at university level. It is safe to say the Hell will froze before sunshine and wind become technically feasible in proposed way. The Sun already does its part – it lifts the water vapor into the skies from where it comes back to Earth and supplies water for rivers and lakes, high up in mountains, from where the water falls down on turbine wheels, with help of gravitation. The circle closed.
I did not know that properties of crude oil determine refining process that gives us derivates such petrol, kerosene, diesel, so each refinery plant is designed and built for specific kind of input – raw crude. Makes sense – try filling Jumbo Jet tanks with diesel, or even ultra super 102 Oct gasoline. Nope, only kerosene would do, I guess with certain defined properties. By he way, kerosene is stuff we burn in lanterns and lamps when the power (electricity) goes out. imagine, burning jet fuel for light. – yet it is exactly that.
It is obvious that both green energy and no Russian oil insanities come from – ignorance. Ignorance of the decision makers. It is OK for lawyers or politicians not to know physics on engineering level. That is why engineers exist – to advise decision makers. Unfortunately, the powers to be believe they know it all – just snap your fingers and order all nuclear/coal/oil power plants to close, also drop Russian oil and replace it with, say Venezuelan Iranian, Nigerian or Texan. Both proposals have dire consequences – undermining seriously technological foundations of the civilization. Everybody will quickly see how true my words are.
For those all knowing, because they posses power to do it, there is a bad news. Even in communism, where politicians are more powerful than in democracies – Stalin did not ask politburo, he simply gave orders – even supreme rulers cannot break laws of physics. It takes fully developed delusional mind to think otherwise.
Andrei Martyanov said something like ‘You cannot explant to idiot that he is an idiot because – he is an iditol’.
I am grateful to Mr. Vilches for pointing lesser known fact of engineering knowledge – dependency of petro-chemical plants on inputs not every oil is for every refinery, just as pipelines, port terminals, seagoing tankers , and other infrastructure. Instead of being worried that PTB can screw us by snapping their fingers, I am now feeling better, relaxed and amused.
As for EU people who will either freeze or at least suffer a lot, well, there is not so technologically dependent solution. It involves only pitchforks, no lasers, satellites or guided missiles. Oh, stop. Pitchforks, eh? We do not produce any. No problem, we can always import them from China, or – Russia.
Thank you Jorge Vilches. Very good engineering explanations, for those able to understand. Good bless you.
zidar, thank you for such an encouraging message. You summarized many pimportant points better than I did. Thank YOU. Cordially Jorge
I don’t think it comes from ignorance at all. They have N experts at hand that can tell them this is impossible.
What you must understand is that these decisions are ideologically based. They are based on a loathing of what Europe was.
Yes, western leadership loathes the West. They seek to turn it into a neutered entity by subverting education and the institutes of society and government.
Even if they concede some kind of triangulation fuel importation solution, they will be desperately on the look out for the next opportunity to subvert and neuter.
Please believe me when I tell you that your government does not have your best interests at heart.
I’ve said this before elsewhere but whenever your government does not act in the interests of the people, we have to ask **in whose interests are they acting.**
Rusia y China se complementan económicamente. USA y la UE compiten entre sí. Cerrarán en Europa los sectores industriales más consumidores de energía ( plásticos, fertilizantes, acerías…) en beneficio de sus competidores en Estados Unidos. Los políticos europeos, salvo Orban, son globalistas sin patria y están haciendo muy bien su trabajo.
Russia and China complement each other economically. The USA and the EU compete with each other. They will close the most energy-consuming industrial sectors in Europe (plastics, fertilizers, steel mills …) for the benefit of their competitors in the United States. European politicians, except Orban, are globalists without a homeland and are doing their job very well.
Frasco, comparto contigo todas tus conclusiones. Las cosas SON así. Lo que no logro comprender aún es si se trata de intencionalidad expresa o ignorancia supina (infantilismo ?). Entiendo que podría ser cualquiera de las dos, históricamente ya ha ocurrido. Cordialmente Jorge
Frasco, I share all of your conclusions. Things are what they ARE. What I cannot yet understand is whether this is all intentionally on purpose or sheer basic childish ignorance. It understand it could be either, historically it´s happened before. Cordially Jorge
“Such old, quick and dirty business is known as “triangulation” and may also involve STS or Ship To Ship high seas transfers. But through every (faked) transaction the price of such de-Russianized oil would increase thus reaching even a 50% surcharge over the original international price paid to Russian suppliers, even discounted. Rinse, repeat.”
Calling all compradors, fakers, and forgers! Looks like plenty of work for you after Dec. 2022.
Re triangulation, funnily enough the triangle was the symbol of the Chinese—yup!—triads, secret societies that controlled virtually all business and most politics within China pre-Revolution (and probably post-Revolution, too), and also in the Chinese diaspora. The “new trading normal” all sounds so . . . complicated and potentially lawless. Giving a role to or actually relying on shadowy middlemen who know how to disguise both their products and themselves, and connect and coordinate the upperworld and the underworld . . . And make a pile of dough while they are at it, probably parked offshore somewhere.
Dear Taffy, yes, and furthermore when public opinion realizes about the only real ´solution´ meaning a massive “triangulation” scheme and sky-high un-affordable inflation… what would the political plan be, what would it amount to ? I mean, politicians are probably knowing and thinking about all of theses consequences no ?
And that´s why desperately all of them now want to “talk” to Vladimir Putin. But it´s bloody too late isn´t it, Russia has crossed the Rubicon and BTW is also winning in each and every front. How will European public opinion react to having themselves LOST — not “won” — the Ukraine confrontation ? Fed up Russia seems to have slammed the door on the WEst, our produce, our rules.
Thanks for your input Taffy !
5€ a liter (20$/gallon) gasoline is in your future my friends.
Oil price elasticity is normally 1:20 in the medium term. A 1% decrease in supply results in a 20% increase in price. A 20% decrease in supply results in a 400% increase in price.
In the long term ( say out 3-5 years ), demand is elastic with price changes but the first couple of years oil demand is rather inelastic. People change their driving habits S L O W L Y
Exile, I read you.
I had not heard of such very specific “Young´s modulus” (hahahhhahh) medium term price reaction of 1:20 but still the concept is valid I agree regarding the elastic / inelastic temporal oil price ratio reactions. At least for a 3-5 year time horizon. Actually, relative ratios is only what matters and surely the specific supply percentage ratio variations are just historically anecdotal and may vary to whatever values. But the underlying impact does not. The idea is what I agree with, and that´s why I mentioned
(sic) ” … Simply put, even if the EU were able to (very poorly) substitute a small portion of Russian seaborne oil (5 % ?) while exporting less Russia would still collect even higher revenue than today. This most valid and already proven consequence defeats the very purpose of the EU´s sanction package No.6. The reason is that by withdrawing ANY amount of Russian oil from today´s ultra-tight world markets, the price immediately increases proportionally or even BEYOND due to very sensitive price expectations derived from the smaller number of remaining willing and able vendors which might not even fully satisfy such newly created world oil market deficit. Thus the supply side of the world´s oil price equation rapidly deteriorates to the point of not being sustainable for more than a few days…” (sic)
Okay fine, but what this author needs to grasp is that this demise is intentional, it is being orchestrated by the collapsing Empire of financialization to in their minds help paper over their dissolution, to so weaken the populations to therefore defuse the populist revolts. It sure don’t seem like that is a viable plan but then I don’t have access to the Bill Gates Davos super computers who have gamed it all out. So, relax, not to worry, everything is going to plan, the Russian public is so demoralized and damaged by the sanctions that rebellion is right around the corner, somewhere, and there will be no western default on unpayable debt, instead they will foreclose on everything, sell it all, they just to have to first get their hands on all the Russian and Chinese assets, they are being a little stubborn, but again not to worry, Joe Biden is at the helm and he can ride a bicycle, and we all need to be practicing up on our bicycling being as cars are no longer going to be allowed, except of course for the few who can afford the 800 per gallon gas.
Thanks for posting.
You say “… Okay fine, but what this author needs to grasp is that this demise is intentional…”.
Okay, “this author” here has thought lots many many many times about the possible intentionality of it all.
And quite frankly I have not yet reached the conclusion that it matters any.
If it´s intentional, Europe will be screwed up bad real soon.
If it´s NOT intentional, Europe will be screwed up bad real soon.
As I have said MANY times and have not achieved is for Europeans to stop this nonesense right now.
If it´s intentional I say then stop the nonsense.
If it´s not intentional I say then stop the nonsense.
Please edwardi convince me as best you can how is it that intentionality matters or would matter any.
I confess I have not been able to do that.
Maybe you can help.
1. Given how specific oil types are, how easy is it for Russia to find other buyers for oil it used to sell to Europe? Won’t there be some difficulty, and won’t it require time? Can Russia do it?
2. It’s good you mentioned what Russia can do to upset Europe’s adjustment “plans”. I wish you could discuss that in more detail: how can Russia maximize damage to Europe and the US while minimizing damage to itself and its allies? What arrows does it have in its quiver?
3. I fully expect that when Russia has dealt with Ukraine to its satisfaction some time this year or next, it will turn to the main show: its confrontation with NATO. I expect Russia will do all in its power to get NATO to accept its December 2021 security guarantee demands. Could you discuss how Russia’s leverage over commodities NATO countries need can be exploited to force them to capitulate?
In a nutshell….China and India have been collaborating with Russia since 2013 for changeovers. The projects for pipelines, etc to both countries are massive. Since Jan, China and India are on the road to completely take over all oil/LNG exports from Russia, that were previously going to the West and EU. On YT you can also find (you might try Shanghai Eye) the full speech GAZPROM CEO gave this week at SPIEF….but the gist of it was “game over” for West and EU.
He said the West and EU did this with their own hands and have shown GAZPROM they cannot be trusted and therefore there will be no more deliveries.
Midge, thanks for your most valid and well-taken comments / questions.
I´ll have more to say later, as right now I am in a bit of a hurry trying to respond to the many un-answered posts because of what I explain in my APOLOGIES below.
Basically, I have already replied to your point No. 1 in the Comments Sections of previous articles, responding for example specifically how is it that India would be pulling the trick of using and refining Russian blends while Europe would have so much trouble, literally to do it NOT on a piece-meal basis but rather ALL refineries throughout Europe all at the same time and with the same deadline competing for resources etc etc etc and not having anywhere ready the logistics infrastructure in place for such a sudden all-around all-inclusive change. I´ll have more on that later but possibly in the meantime you may look into that yourself just to gain time. I recall it was a very “longuish” reply of mine.
My response to your comments No. 2 + No. 3 would basically be limited to what I have already said in my first 2 paragraphs of my previous article ” Pitchforks soon in Europe ? ” at https://thesaker.is/pitchforks-soon-in-europe/
Europe would lose any war by Russia merely embargoing strategic value-chain upstream items with captive EU consumers cascading into multiple failures thru lack of nat-gas, rare earths, inert gases, potash, sulfur, uranium, palladium, vanadium, cobalt, coke, etc. PLUS titanium for aircraft…
So being at war and with nothing else to lose other than engaging in nuclear warfare an OIL + nat-GAS unilateral Russian cut-off means Europe stops dead in its track, military included.
Russia does not need to fire a single shot or land a single missile on European territories to win such a total war. Think tanks in Europe and elsewhere know this but say nothing. It´d be plenty enough for Russia to just shut off your nat-gas supply, period. And not even to the whole of Europe. It could possibly be to only, say, some limited area in Germany.
Midge, I have been partially responding elsewhere to your still pending Point (1) so please excuse me for not addressing it specifically right here right now. But if you scroll up and down you will find your point (1) addressed at least partially in my responses to other posters.
For example, responding to James I said
“… yes, of course that other nations after decades of development have set themselves up to slowly refine non-Russian blends. And yes, eventually and very gradually, with lots of HUGE investments ( switching over 50-year contracts is not easy ) with LOTS of time and the right expertise — which does not necessarily readily exists RIGHT here and NOW for absolutely EVERYBODY in Europe today — and running lots of uncertain and unnecessary risks which would mean freezing and/or starving to death … yes, true enough James, some EU refineries might also end up being able to refine non-Russian blends.
But all of a sudden from one minute to the other with no prior plans, changing absolutely everything for ALL of Europe at the same time and with the same 6-months deadline ( NOT 6 years…) including crude oil vendors themselves that do not exist nor have the right blends in LARGE enough quantities to offer, tankers, sea routes, ports and docks and pipelines that require revamping / upgrading and refineries that require re-tooling & retro-fitting while they STILL continue refining, etc etc etc etc etc etc etc etc would be like trying to change the oil of your engine while cruising at 150 km/h on a German autobahn… You wouldn´t care to try that out and tell us how it all went, would you ? Cordially Jorge “
Midge, also please re-read what various other posters just like yourself right here right now who have described the situation even better than myself in some instances !!! Yes, I firmly believe that and confess it without reservations !!! I´d say that adding up their statements and explanations these fellow posters have fully replied to your points above.
For example, Dave Hansell ( and also others above, or also Kate but scrolling downwards) have stated and expanded most stuff I could not have said them better myself. Dave and others, have precisely summarized the nature of the problem and what´s really behind, for example, regarding your point No. 1. Still, you are always in my mind Midge, so please comment further. And as soon as I have more time I´ll be back here okay ?
At least Europe is most likely arriving at peak stupidity. Probably all that’s left for them to absolutely max out the stupidity meter is to get themselves in a shooting war with Russia and that could well be coming.
Befree, I read you and yes, what you say is in the cards because Europe is acting very stupid lately.
Still, as specifically mentioned in my previous article at the very beginning, 2nd. paragraph
” lost war
Russia does not need to fire a single shot or land a single missile on European territories to win such a total war. Think tanks in Europe and elsewhere know this but say nothing. It´d be plenty enough for Russia to just shut off your nat-gas supply, period. And not even to the whole of Europe. It could possibly be to only, say, some limited area in Germany.”
Befree, yes, as already stated in my previous post I basically agree, but…
At any rate, my response a few minutes ago was actually in a bit of a hurry in my eagerness to respond to everybody else also as I have lots of catch-up as explained below in my “APOLOGIES” post below.
The point is I forgot to repeat something else that was also mentioned even before in my previous article, namely 1st. paragraph, i.e., ” Pitchforks soon in europe ” which has already attracted some 45,000 “The Saker” viewers.
So, without firing a single shot, Russia would win any non-nuclear “war” by just embargoing strategic value-chain upstream items with captive EU consumers cascading into multiple failures thru lack of nat-gas, rare earths, inert gases, potash, sulfur, uranium, palladium, vanadium, cobalt, coke, titanium for building airplanes, etc.
Please check out https://thesaker.is/pitchforks-soon-in-europe/
“No Fuel For Europe?” I prefer “No Sleep To Brooklyn” by The Beasty Boys.
‘Sabotage’ by The Beasty Boys would be more apt.
Between now and December Russia needs to be building and or buying as many tankers as they can. Founding/expanding shipping companies,and maritime insurance companies. And as many of the tankers they have now should be the only ones allowed to ship the oil. That would add revenue for Russia,and jobs for Russians now.
Get prepared for the cutoff now. Because when they cut the oil off they will try and force non-Russian shipping and insurance companies to cut all ties with shipping Russian oil worldwide. Russia needs to be ready for that in advance. Whether there will be enough Chinese,Indian,or other nations shipping able or willing to ship the oil ,can’t be counted on after December.
Uncle Bob, yes I agree that what you describe will happen and most probably has already been planned for and, in a way, is already happening.
I think it is also very easy to anticipate that 6 other 6 different things will happen:
(1) China, India, and others would start to modify/adapt their own seaborne trade infrastructure, ports, docks, etc, for import and shipment of Russian oil blends
(2) China, India, and others would start to modify their existing refineries and petrochemical processing plants for Russian oil blends feedstocks.
(3) China, India, and others would start building from scratch brand new fully dedicated refineries and petrochemical processing plants for Russian oil blends feedstocks
(4) start to design, bid out, and build trans-Asian pipelines for Russian oil blend feedstocks
China and India would lead, even investing with Russian partners.
(5) The BRI Belt & Road Initiative would be the play-book to follow.
(6) The expansion of BRICS with the addition of new countries (even as far away as Argentina) will take center scene
Russian President Vladimir Putin´s speech yesterday in the San Petersburg meeting was “a before & after” moment methinks. Check out what Vladimir Putin made 100% clear to the St. Petersburg International Economic Forum (SPIEF) on Friday.
Commentariati know well that I try my best to be present here in this Comments Section for many important reasons. For one, to respond to questions / inputs / or whatever comments are posted by yourselves — the more critical the better — because we all learn from them (starting with myself) and many times triggers most meaningfull discussions and debates amongst all of us.
And that´s why I call this place “home” whereby thanks to critical comments and encouragement received I can (a) have a chance to respond instead of leaving everybody with the doubt as to what my answer would be and (b) it exposes everybody else to such ping-pong discussion / debate (c) it gives me ideas for new articles and topics or aspects to write about (d) allows me to explain right here the new perspectives that spontaneously arise or whatever has come up thanks to input received (e) allows all of us here — starting with myself — to plain LEARN new stuff and THINK better collectively. It´d be very easy to verify this by just re-reading past “The Saker” articles of mine and their respective Comments Sections. Nothing really new so far, we all know about this by now, I guess.
Today — and somewhat tomorrow Sunday — all of the above will be slightly different because I cannot be here present as much as I usually do and want to …and need to… The reason being that life does go on and today (Saturday) I had to fortunately attend a most important luncheon party outside of town which took me the better part of the day, namely my grandson´s birthday No. 3 of which, of course, I was the official Entertainer-Clown-In-Chief which Tommy enjoys oh-so-much and so do I and the rest of the family also so we had hours of laughs, and chalk drawings of sorts and collective squirt foam games to play with some 2 dozens friends of his who were also expecting me as much because of previous birthdays Tommy and I get invited to because blah blah. At any rate, not only should it be obvious by now how proud and happy I am about all of the above, but the fact is I could only show up here some long 15 hours after publication with many comments left un-answered which is not what usually happens.
BUT, I will stay here at least some 6 more hours no matter how late it gets to be and responding every single one of your comments here if I can make it. Maybe I´ll take me some time because one of my many defects is that — very much convinced that I have lots to say — still I am not anything close to being a good typist. I type slow, very SLOW. And I will have to at least rest some and be ready for yet additional “festivities” because around this part of the world tomorrow Sunday it´s “Father´s Day” so a whole bunch of family will come over for another luncheon party, this time me being the (sorta) “sommelier” with good wine both red and cold sparkling white which I like best.
In sum, APOLOGIES twice… APOLOGIES for my absence today and APOLOGIES for my absence tomorrow… which shall mean me being here — just like today — only a while and not the whole day long as I pretty much usually do in order to keep up my response “momentum” — or ´moment of inertia´ as engineers would say — and the Q & A dynamics for everybody to keep up asking and making comments of whatever nature they may be.
BUT still, because of all of the above, PLEASE be advised that I shall be available in this Comments Section the rest of the week — full time full — from Monday to Friday 15 hours every day to participate and respond in this Comments Section. So rest assured that throughout next week I´ll be here to compensate somewhat for my double (partial) absence Saturday and Sunday.
I’ve never seen anyone defend their articles with such zeal, on an online publication, such as you…
As an engineer, I envy you. I have given up explaining decades ago. I only do it for a select few and I simply deflect the rest.
You go all the way. I don’t have the drive for it anymore.
So, go have some time with your family. You deserve it. Ignore us. We can handle ourselves after all. Worst case scenario, we will have a small flame war :)
Erlindur, I follow, understand and feel every single one of your words very deep in my heart and my soul. Forget my brains simply because them aren´t that well developed anyways. I hear you Erlindur very loud and very clear. I´ll say it yet again, but fortunately this time around with Erlindur right next to me nodding his head to the audience as I speak : ” People please listen… mine is a very lonely task, trust me ”
Skeptics please check it out with Erlindur. Guys, what I say here is not original by any means, it is very well known by MANY people MUCH smarter and FAR more knowledgeable than myself.
My role here thanks to “The Saker” editors Andrei and Amarynth is being a sort of Communicator Preacher for lack of a better term. “Communicator” because I just repeat in an understandable language (sorta) as far as possible what others know much better than me. And “Preacher” because of what Erlindur is saying, so Help Me & Us God Almighty.
[ Erlindur, between you and I, there´s also another reason floating around: It´s impossible to stop me because I just need to do this. This right here right now in more than one way is home to me. In enjoy being here now with, for example, yourself Erlindur while reading your most correct interpretation of my circumstances which nobody else has done as well and as succintly as you have. Amen ]
My most respectfull yet veru warm koala bear hug for you Erlindur
And the super-cool side effects of triangulating russian Oil imports is, the US will know everything and can and will if necessary intervene.
Only last week an advisory group got the task to investigate how the US fix oil prizes (??!!) and can make sure the oil-sanctions against russia cannot be circumvented by third party involvment etc. HeHeHe, nice hook ! There will be ALWAYS an US intermediary in the line of triangulation (or shall we call it strangulation valve-point ?) siphoning off hefty gains.
The EU’s bureaucracy is now solely a toolset for the US to re-size Europe as it sees fit and necessary…HeHeHe ! Brussels must now resemble a huge and very dark (XXX) SM-dungeon.
Dear Jorge, your latest article is a great synthesis of all your previous analyses summarizing beautifully what a gargantuan project it is for the European refineries to switch from the Russian Urals oil to some unknown oil – the required sequence of coordinated and time limited, countless engineering, logistical, legal, environmental etc. tasks is mind boggling.
Any sane person can see that this EU plan is a sheer idiocy.
Yet, the globalists and NATO vassals in Brussels obviously don’t care and also don’t have any engineering or scientific knowledge.
What to expect from these people who also want to dictate to us that there are many “genders” out there? The lunatics run the asylum nowadays. :)
In Slovakia the government is completely subservient to those lunatics and agreed to all these crazy restrictions, thus it started the first step towards the national economic suicide. There is a talk e.g. about possible rationing of fuel as a result of the sanctions. Let alone Slovnaft, the 7th largest business in Slovakia being destroyed.
The Slovak government actually is so dumb that it even agreed to more draconian oil restrictions than the Czechs or Croats, etc. The Slovak opposition parties are very angry and began a big referendum to get rid of this government, because they see how prices of gas and oil and its various derivatives will affect the general population. The pitchforks are actually starting to appear in Slovakia. The mood is almost explosive.
Slovakia also depends heavily on natural gas, because practically every house has gas heating and cooking and now people will be paying 100 % higher prices for their gas and they will not be able to pay.
Your articles are enlightening and helpful to many people in my country, thank you, Jorge, for writing so well. I always read everything that you write and follow your comments in the discussions.
Dear Kate, please be advised that I´ll be responding to you momentarily because, as always, yours will be a longuish answer and — as always… — I have several things to bring up and discuss regarding your always so helpful and in-depth posts. Right now I´m rather “busy” with family — it´s Father´s Day here — but please bear with me some and shortly I´ll be back here with you all responding and bringing up teasers for discussion / debate.
Dear Kate, I have lots of things in my mind I´d like to mention and discuss with you. But for the time being please allow me to focus only on the main points, the first of which is that I envy (a) your synthesis and (b) your English. The way you summarize the problem at hand reminds me of Ernest Hemingway´s brilliant style, nothing less.
Obviously you also have first-hand & hands-on experience in the chemical trenches of the problem. You don´t go by hearsay, you are or have been in the front line I am sure. And yes, as you sharply observed, Europe has unnecessarily set itself up for multiple simultaneous cross-borders gargantuan projects impossible to fulfill, with absurd sequencing and scheduling coordination requirements, with peremptory timing limitations and deadlines, involving countless synchronized engineering specialties, ridiculously demanding logistics, overwhelming legal, political, and environmental aspects, etc. etc. etc. which you know about at least as much as myself and even further in depth in the case of Slovnaft.
We also have the most unfortunate land-locked situation of Central Europe vis-á-vis the Russian oil & gas ban. I am convinced that very serious problems will first start either in Germany or East of Germany in Central Europe. I say so because Germany would be the tighest imaginable market ever with absolutely everything highly demanding and ´just-in-time´ crude oil and fuel refinement and distribution included. And “East of Germany” because of the large distances to minimally functional far away ports which will become most relevant the instant that the Druzbha pipeline shuts-off or under “conditioned service” for a variety of possible reasons, including ´reasons´ Ukraine itself might have.
Regarding the crude oil itself, the additional ´problem´ is that the Urals blend is also extraordinarily constant and homogenous, traits to which European chemical processing industry and refineries are very much used to. Trying to substitute the Urals blend with a variety of changing diverse yet-unknown variable low-quality oilsssssss will be impossible. As I´ve said more than once ” Matching the Russian Urals oil grade is theoretically ´possible´ by blending HIGH quality oils from different sources IF available in reliable and large enough quantities. BUT achieving the blend specifications and volumetric physical flow requirements to meet refinery required output vis-á-vis desired final product specs is very difficult . Beware: the Urals blend allows for a very constant Nelson Complexity Index of 9.8 to thusly refine with excellence a range of products including petrol (gasoline) diesel, aviation turbine fuel, LPG, extra light heating oil, heavy fuel oil, bitumen, benzene, toluene, xylene and sulphur.”. So…..
Kate, please keep updating us on any important news of any sort, either purely technical and/or others such as “fuel rationing” and the “explosive mood” around Slovnaft and surrounding areas including the Rosenets- Burgas access to the Black Sea for seaborne crude-oil deliveries which is also a matter of great concern today for obvious war-time reasons.
Kate, once again thank you so much for your most valuable input and favorable feedback. Most cordially Jorge
PS: Yes, I also fully agree with your sentence ending in …” the lunatics run the asylum nowadays. :) “
Jorge I love your articles. They are so educational, exact and humorous.
I said below in response to another post, that when your government does not act in the interests of the people then we must ask **in whose interests are they acting**.
Notwithstanding the superb exactness of your many excellent articles we must all wake up now and start asking this question.
Dublin Prof as always, much obliged here. Hearing that you enjoy my articles makes all the difference precisely because I get a sense of effective, down-to-earth purpose otherwise missing, trust me. Feedback like yours is most welcome and essential because yes, as you say, I try to be educational, precise as much as possible in view of circumstances, and also with some sense of humor to make for an attractive “colorfull” read at least…
Still, I welcome critical thought and suggestions. For example, what aspects or specific topics could the next article of mine refer to ? A suggested title would also help. I don´t want to repeat myself as much as it may be needed for some. European Parliament members are beginning to notice my articles, so… I´ll keep you posted. Of course, it´s difficult to approach a very broad audience. Still, it´s worth the while methinkxs.
Respectfull koala bear hug for ya Dublin Prof !!!!
Short of fusion and nuclear total world energy demand of current indilustrial civilization can NEVER be met with renewables. And fossil fuels are finite.
So there is a short/finite window to utilize the productive capacity of fossil fuels to R&D other secondary tech innovations (medicines comes to mind) before the oil is gone/climate destroyed.
It’s sad that instead humans are pre-occupied with finite gdp “growth” driven by consumption. Not only capitalism, but all developmentalisms reliant on high energy industry are diseases.
I just had a brilliant inspiration by which the EU, the British, Canadians and Americans can survive the winter without heating their homes. These people can spend their winter in a hot country like India or in the South America. The cost of living would be low. Many people can work from home online. Governments can subsidize their temporary emigration. This would be a very good opportunity to humiliate Russia by not having any need for gas at all! Besides, it will be a patriotic duty for people to live outside their country by saving it the hassle of providing them with gas.
We all keep hearing how protracted and long the war in Ukraine will be.
Possibly, yes, it would be.
But me agrees with Russian Federation former President Dmitry Medvedev in that the EU as such would disappear way before the war in Ukraine ends. Check it out at
OPEN QUESTION re my next article
please respond with suggested title or topic / aspect to be explained / discussed
OPEN QUESTION re my next article
title = ?
topic = ?
aspect = ?
OPEN QUESTION re my next article
My suggestion is an analysis of the natural gas market and how the sanctions will impact the economies of Europe since the gas is as important as oil and without the gas the economies will collapse.
E.g. Slovakia depends 85% on the Russian gas that is being imported via pipelines. There is only 25% gas in the storage ( as a reserve) wich means after a month of not getting any new deliveries, the country wil run out of the gas. Yet almost every household and business needs gas because they all switched to gas a few decades ago.
A talk is now about building new facilities at the Danube port in Bratislava, very near the city centre in fact. There, presumably, ships would deliver LNG from America, which sounds crazy and extremely expensive and inefficient, let alone dangerous surely, because of such explosive material being delivered into the city.
And finally, many cordial thanks, Jorge, for your replies to my post above, as well as for letting us, your readers, to suggest a topic.
Thank you Kate for your always most valid input “from the real trenches” and right now with a most important suggested topic. My basic perspective is as follows: both oil & gas are tremendously important for everybody, of course, but most specially for Europe which the EU sort of “sweeps under the rug”… until it can´t any more ! Instead, for Russia, nat-gas exports are “okay” of course, but exporting oil means FAR more revenue ($$$$) than nat-gas. Oil and petroleum derived products exports are the Russian cash-cows so to speak.
Having said that, the oil market is also simpler — and safer — to analyze as it is rather straightforward with just a few “moving” parts, that´s all. For example, I feel very comfortable explaining what would probably happen 6 months from now. On the contrary, the nat-gas world has lots and lots of moving parts, scenarios are multiple if not infinite. Of course, no nat-gas also no Europe as we know it, I agree. And the US LNG “solution” is awkward and very risky from many standpoints, but also just applicable in the mid-term future, never for this season and probably not even for next winter season, at least for ALL of Europe, no ? And the need is right now, not months away, let alone years from now.
The Danube facilities you mention Kate is an excellent example of the above. To be honest, intuitively at least I cannot foresee any sustainable technical European solution for nat-gas… nor for crude oil for that matter… other than to keep importing from Russia as originally planned decades ago !! Many ´expert journalists´ publish articles on nat-gas simply because, in a sense, is simpler to understand as “no gas no heating” while they run away from Russian oil-ban in-depth analysis for lack of very basic knowledge of logistics, project management, geology, petro-physical limitations and refinery chemistry.
So… the nat-gas world market analysis is very important but even far broader than crude oil discussions despite its own technicalities of course.
Kate, please do hang around browsing and staying in touch with excellent opinions and info. Cordially Jorge
Kate, your diagnosis is making international front page headline news.
And some say that “green technologies” will end up being the winners…
On neighboring Czech Republic only 50 kms. away from Bratislava top government officials say
” We’ll burn anything to keep people warm…” per Czech Ambassador-at-Large for Energy Security Vaclav Bartuška
” … It is still possible to provide the EU with gas before the heating season if European countries sign long-term contracts with LNG suppliers.” The European Commission has been uneager to sign them in the past, but, according to Bartuška, the situation has changed.
Other than dollars, forget “green”.
Austria is back to dirty coal…
Dutch join Germans & Austrians and revert to coal, the dirtiest of them all
So, the EU countries are now going to revert to coal as their energy source, how ironic. :)
The natural gas is vital , but they are going to abandon it foolishly. That is why I thought that this would be an interesting topic, because it is hard to imagine how the EU will be able to substitute the natural gas.
Although, as you say it is a very difficult topic to be analysed.
But unfortunately the EU economies are too dependent on gas. E.g. to enlarge the present port on the Danube in Bratislava would cost about 40 million euros at least. And people worry about the possible dangers of an explosion in the LNG storage tanks. The prices will sky rocket, which will be devastating. And to convert the heating systems using gas back to burning the coal will be also difficult and expensive.
The most awful thing is how the rulers in Brussels and NATO can dictate whatever they want and nobody seems to be able to do anything about it.
Cordially, with many thanks, to you, Jorge, for all your excellent articles and comments. Kate
Dear Kate, I understand and agree with everything you say.
Rejecting cheap and abundant well-delivered and always reliable Russian gas is plain crazy and VERY costly money-wise and time-wise and also politically as it could mean the end of the EU tyranny. So methinkxs that Russia cannot and will not do anything more about nat-gas than what has already been done. They have it in enormous natural abundance, it´s cheap and ´cleaner´ than anythng else, and they are willing and able to deliver it properly and sell it…or vent it or re-inject un-sold surplus into reservoirs. That´s it and with the Russian nat-gas liquifying business forever postponed. So the ball is in the EU court to decide… and winter is coming closer by the day.
Oil is different, and Russia will sell it and collect the enormous revenue derived, but as oil — unlike gas — is fungible now Russia will surely introduce changes in the strategic management of oil, sick and tired fed up of Western lies and shenanigans, thus pivoting towards Asia. And Europe will not be able to successfully substitute the Urals blend no matter what they do. The problem is that politicians do not know that yet. They will though thus making room for political change.
So the “Brussels problem” prompted me to draft and publish my “Pitchforks soon in Europe” article and I think that before the (supposed) back-to-coal ´solutions´ that you describe ever happen, public opinion unrest throughout Europe will dictate otherwise and “changes” will take place. People can be pushed around, yes, but they also have limits such as freezing or hunger that politicians have always mis-calculated.
Furthermore, the back-to-coal ´solutions´ proposed are (a) very dirty, imagine Greta and her greens (b) expensive (c) it would not be for THIS coming winter soon knocking on the European doors and probably not even for NEXT winter 2024 throughout Europe or even for 2025… plus (d) requires enormous TIME and also RISK and CHANGES and tight schedules all around, bids, bidders, oversight, etc. etc.etc for which nobody is prepared for nor regulators, nor vendors, nor end users, nor households nor the industry at large ! So the back-to-coal solution is NO effective solution either because events develop with a “technical” timing. For example, going back to coal requires DE-conversion from natural gas and RE-conversion into coal — with all that it implies re time, costs, architectural limitations, interupted services and production, upheaval, labor union conflicts, discomfort, civil works, electromechanical contracts, specialized labor, expertise, etc. — while once again all of this is done simultaneously throughout Europe ??? Who are they kidding ?
That´s why regular people will eventually revolt and the problem will suddenly turn POLITICAL as it was all along. All of these things were automatically decided when Europe accepted to ´marry´ Russia, and vice-versa, so Russia cannot deliver or sell its nat-gas to anybody else other than Europe… So now it is technically way too late to change anything. Pipelines are there, and the disribution infra-structure also. So I foresee political upheaval even from Volodimir Zelenskyy himself ( cornerned and losing ) interfering in oil & gas deliveries from Russia.
But there are 3 pipelines that nobody can interfere with, i.e., Nord Stream 1 & 2 which go directly to Germany and the third one directly to Turkey. If either one flips in Russia´s favor they could at least save their own necks from freezing and famine. And NATO and the EU would break up… Hmmmmm…
“Germany, Austria, Italy and the Netherlands announced their plans to step-up use of coal for power generation, while Sweden and Denmark said they would also launch emergency measures to curb the use of natural gas”
EU told to prepare for total Russian gas cut-off
Dear Kate, as per your suggestion, in my next article I´ll try to include a couple of paragraphs regarding the back-to-coal reversion in Europe. It´d not be an all-inclusive analysis on Russian gas provision, but rather just a down-to-earth comment on the very idea. So thank you for your suggestion Kate ! Cordially Jorge
There will be no triangulation. Diesel will be rationed in the EU and in the rest of the West. Only large logistics and delivery companies will be able to receive the rationing contingencies. The consumers and the small producers will not be able to use their diesel cars, pick-up trucks, and lorries anymore.
This is not about Russia but about downsizing the vast majority of Western households and Western SMEs. A simultaneous outbreak of a new pathogen would not be a surprise to enable non-democratic (even lawless) control of the population by non-judicial policing methods and other administrative measures to forestall popular uprisings.
Advice to Western families who can see there is something faulty here: if there ever was a time to move to a non-Western location, or at least to the countryside of your own nation, it is now! If you have kids and other members of your family to protect, and if you have some practical abilities that you might offer in a truly free market without government funds and subsidies, then get the hell out of large Western cities while you still can.
PS: Almost all diesel cars you can also run on vegetable oils. There are many small specialised firms in Europe that install a second tank to your diesel-powered car, that feeds vegetable oil to your engine while you only switch to diesel a few minutes before shut off to clean the engine from oils to prevent residue, sediment, and congelation, especially in winter. Convert your old diesel now, as the conversion and those firms who offer it will be outlawed too.
SZ, I follow your logic and fully accept that, of course, we can´t KNOW for sure what will happen.
For example, nobody can quantify precisely how much triangulation will actually take place. But then you say it´d be “zero” because triangulation will not happen at all…
But I still insist though that black market triangulation to larger or lesser degree will necessarily always happen simply because it´d be good “business” just like drugs or weapons.
I also wouldn´t even think about the possibility of rationing diesel fuel. I mean governments can try fuel rationing but pitchforks can and will retaliate. From my perspective, I cannot imagine any meaningfull “rationing” of diesel fuel in Europe and in the rest of the West without government overthrow a week after and total European capitulation in accordance to all of Russia´s terms. Maybe I´m missing something but European and Western middle and upper class bourgeoisie are a very comfy cozy bunch that will not put up with having no transportation and no heating… and possibly FAR less food while the lower classes necessarily take stuff away from them. It´d be chaos.
You say that ” … The consumers and the small producers will not be able to use their diesel cars, pick-up trucks, and lorries anymore…” correct ?
I also can´t fathom the practical side of substituting diesel fuel by vegetable oils.
You suggest to do the conversion now because later it´d be outlawed. So that should mean that by government regulations there would not be any vegetable oil offered for sale, no ? Hmmm…
Just don´t see it happening, but I may be wrong of course. I insist : before any of that could happen the EU would cease to exist as we know it, period. Game Over.
As I replied to JJ above (please scroll up) I mentioned in passing in one of my “The Saker” articles that the only solution for Europe is to rewind and back-pedal right now. Rewinding later would be another Catch-22 total chaos that even pitchforks would not solve.
Here with a different wording:
Diesel cars will eventually be banned and diesel as a fuel will be rationed in the West. We will see this in our lifetimes.
As for the pitchfork: well, young males between 20 to 40 could theoretically start an uprising but they are rather busy playing with their phones and masturbating the day away. The contemporary young European male population is incapable to even hold a pitchfork let alone use it.
To all the 40- and 50-something fathers who are able to relocate themselves and their families out fo Europe: Do it while you are still able to do so.
Russia has now become China´s top oil supplier.
No soup for you!
New plan: enforce global price ceiling.
Explains the coming Biden visit to the Saudies then. This needs also OPEC cooperation or from a large majority.