Russia has been warning Ukraine about joining NATO since 1997. Ukraine was not asked to join for 24 years, with no Russian attack on Ukraine. Suddenly, in year 25, with Ukraine still not invited to join NATO, Russia decided to attack? And they attacked not just the Donbas region, where Russian speaking Ukrainians have demanded independence since 2014, and were violently attacked by the Ukraine military, with over 13,000 dead so far. Russia would have been justified if they saved Donbas from relentless Ukrainian shelling and sniper attacks. But Russia attacked the entire nation of Ukraine, which can not be justified.
The attack was telegraphed by 100,000 Russian troops on the Ukraine border in the coldest part of the winter. The US and UK had pledged to defend Ukraine in 1994, to convince them to give up their nuclear weapons. Weapons they shipped to Russia by 2016. In early 2022 it was obvious Ukraine was going to need defending. The US and UK, both cowards, did nothing to send Russia a message they would be defending Ukraine. Whether true or just a bluff, that could have prevented the Russian attack.
A strong message was needed to prevent an attack after both nations failed to defend Crimea in 2014, when Russia seized that region from Ukraine. That 2014 appeasement had consequences. Eight years later for Ukraine.
The first casualty of war is truth. Reports that Russia is struggling against the Ukraine military are fake news. To Russia's credit, they have spared civilian infrastructure targets. Electricity and the internet still work. Completely unlike the vicious US attack on Iraq in 2003. Russia is trying to defeat the Ukraine military, not the civilians. If that Ukraine military takes positions in civilian areas, and they have, that's bad news.
Ukraine's Zelensky is a horrible, incompetent and corrupt leader. Putin is horrible and corrupt. But he is not incompetent. As far as I can tell, Putin is still demanding the same things he has demanded for years: A Ukraine pledge to remain Neutral, never join NATO, and an end to the violence committed against Russian-speaking Ukrainians -- allowing Donbas to vote for independence from Ukraine. Putin will get all three demands met by force. Zelensky, by encouraging Ukrainians to fight against Russia, which is a certain loss, should be removed from office by his own people. That would save lives.
"The energy crisis dramatically intensified last night as Vladimir Putin threatened to turn off Europe's gas supplies as soon as today if countries refuse to pay in rubles.
The Russian President, announcing a decree in televised remarks yesterday, said foreign buyers would have to 'open ruble accounts in Russian banks' which can be used to pay for 'gas delivered starting from tomorrow'.
'If such payments are not made, we will consider this a default on the part of buyers, with all the ensuing consequences.
Nobody sells us anything for free, and we are not going to do charity either - that is, existing contracts will be stopped,' he said.
The move has been seen as a bid to bolster the Russian currency, which fell to historic lows when the West applied sanctions after he sent his army into Ukraine on February 24.
Although Britain gets only 4 per cent of its gas from Russia, the extraordinary threat comes as millions of families face a record hike in energy bills of nearly £700 today.
Western companies and governments have rejected the demands as a breach of existing contracts, which are set in euros or dollars.
As the deadline for the EU to meet the demand passed at midnight, it remains to be seen how or if President Putin will implement his threat.
However, the president's bullish comments on state television stating 'unfriendly countries' must pay for gas in rubles from midnight or face supplies being suspended seemed to be watered down by the Kremlin's decree,
which allows customers to pay dollars and euros to intermediary Gazprombank, which would then buy rubles on currency markets.
Russia has been hit by sweeping sanctions on its economy and trade since the start of Putin's war in Ukraine
but measures by EU governments have not targeted oil and gas contracts with Moscow because many member states are heavily reliant on the Kremlin's supplies.
The European Union gets 30 per cent of its oil usage from Moscow and relies on Russia for 40 per cent of its gas consumption, costing the bloc £340million (€400million) a day.
However Moscow cannot easily carry out threats of shutting off deliveries to Europe because the Kremlin has no alternative pipelines to redirect the oil and gas to other markets and does not have sufficient storage facilities to hold oil and gas reserves until alternative buyers can be found.
Putin said the switch was meant to strengthen Russia's sovereignty, and insisted Moscow would stick to its obligations on all contracts, if foreign buyers agreed to pay in rubles.
German Economy Minister Robert Habeck yesterday rejected Putin's demands of payment in rubles as an unacceptable breach of contract, adding that the manoeuvre amounted to 'blackmail'.
Separately, Chancellor Olaf Scholz said German companies would continue to pay for Russian gas using euros as stipulated in contracts.
'By all means, it remains the case that companies want, can and will pay in euros,' he told a joint news conference with his Austrian counterpart Karl Nehammer.
A spokesperson for British Prime Minister Boris Johnson said that companies do not plan to pay for Russian gas in rubles, adding that the government was monitoring the implications for the European market of President Putin's demand.
A host of European countries are still dependent on Moscow for most of their gas and oil supplies.
Russian gas accounts for a third of Europe's total gas consumption, rising to 55 per cent in Germany
Putin demands Europe 'must open ruble accounts' for Russian gas supply
Asked if there were any circumstances in which Britain would pay in rubles for Russian gas, the spokesman said 'that is not something we will be looking to do,' adding that Putin's latest decrees show 'the impact that our sanctions are having on the Russian economy'.
'There are no gas pipes directly linking the UK with Russia, our imports from Russia made up less than four per cent of total UK gas supply in 2021 so we are obviously less reliant on it than many of our European partners,' the spokesperson added.
Putin said last week that Moscow would only accept rubles as payment from 'unfriendly' countries in retaliation for sanctions imposed over his invasion of Ukraine.
According to Gazprom, 58 per cent of its sales of natural gas to Europe and other countries as of January 27 were settled in euros.
US dollars accounted for about 39 per cent of gross sales and sterling around three per cent.
A Kremlin decree published today sets out that contracts will be stopped if buyers do not sign up to the new conditions, including opening ruble accounts in Russian banks.
The buyers can still pay in foreign currency and authorise the bank to sell that for rubles, which are placed in the second account, where the gas is formally purchased.
Putin also decreed today that foreign buyers of Russian gas will have to use special accounts at Gazprombank to pay for the import of Russian gas.
A foreign buyer is now obliged to transfer foreign currency to one special, so called 'K', account. Gazprombank would then buy rubles on behalf of the gas buyer to transfer rubles to another special 'K' account, the order said.
Gazprombank would then transfer ruble funds from a 'K' type account of the foreign gas buyer to Gazprom's ruble accounts, the order said. Gazprombank can open such accounts without a presence of a foreign buyer's representative.
German Economy Minister Robert Habeck, speaking during a joint news conference with his French counterpart, said:
'With regard to the threat, demand or consideration - one doesn't know what to call it anymore - to be made to pay in rubles, it is crucial for us that the contracts are respected... It is important for us not to give a signal that we will be blackmailed by Putin.'
Germany on Wednesday triggered an emergency procedure to monitor gas imports and storage capacity and urged consumers and manufacturers to reduce consumption in preparation for any Russian delivery stoppage.
The network regulator said on Thursday the situation was stable and that storage had risen slightly.
Habeck said he and French Finance and Economy Minister Bruno Le Maire discussed possible new punitive measures on Russia, declining to go into details.
'The last sanctions package must not and should not be the last.
We spoke about what additional sanctions can prevent Putin from continuing the war in Ukraine,' Habeck said.
Scholz also raised the possibility of new sanctions on Russia over its invasion of Ukraine, adding that Germany was prepared for all scenarios, including a stoppage of Russian gas flows to Europe.
Scholz reiterated that Germany hoped to become independent of Russian oil and coal imports this year, but it would take longer to reduce its dependence on Russian gas.
French Economy Minister Bruno Le Maire said 'contracts are contracts', but declined to elaborate on the next steps.
Dutch companies Gasterra and Eneco said they would stick to the contracts, which meant they could pay for Russian gas in Euros.
Gasterra said: 'International agreements contain clauses about payments and currency.
Sticking to the agreement remains our position.'
It comes after Putin on March 23 announced 'unfriendly' countries would have to pay for gas in Russian currency in retaliation for Western sanctions over his war on Ukraine.
'Russia will continue, of course, to supply natural gas in accordance with volumes and prices... fixed in previously concluded contracts,' he said, adding that sanctions had 'destroyed Moscow's trust'.
'The changes will only affect the currency of payment, which will be changed to Russian rubles' for a list of countries, corresponding to those that have imposed sanctions.
Putin said at the time that the government and central bank had one week to come up with a solution on how to move these operations to the Russian currency and that gas giant Gazprom would be ordered to make the corresponding changes to gas contracts.
Contractual changes would have meant European customers had to renegotiate their agreements, which are mostly in euros.
The list of 'unfriendly' countries includes the United States, European Union member states, Britain, Japan, Canada, Norway, Singapore, South Korea, Switzerland and Ukraine.
Among other things, deals with companies and individuals from those countries have to be approved by a government commission.
The move forced Germany, Europe's biggest economy, to declare on Wednesday an 'early warning' that it could be heading for a supply emergency.
Germany imported 55 per cent of its gas from Russia last year.
'In order to purchase Russian natural gas, they must open ruble accounts in Russian banks.
It is from these accounts that payments will be made for gas delivered starting from tomorrow,' Putin said in televised remarks
It is thought the move was intended to boost the Russian currency which fell to a record low of 120 to the dollar this month following the invasion of Ukraine, despite usually trading around 80 to the dollar.
After the announcement on March 23, the ruble was 3.4 per cent stronger against the dollar at 100.02, its strongest since March 2.
A higher rate means exports give a better return and more money can be pumped into the state coffers to pay for the war in Ukraine.
Dollars, euros and pounds are also less valuable to Russia because with restricted access to international markets, the currencies are harder to use.
Moscow had hoped to sell foreign currency investments for rubles to push up the price, but the plan was scrapped when the West agreed to cut Russian banks out of the Swift global payments system in February.
Instead, the Kremlin forced exporters to change 80 per cent of the foreign currency they receive into rubles.
Putin is now reportedly considering pricing all energy and commodity exports in rubles, toughening the Kremlin's attempt to make the West feel the pain of the sanctions it imposed for the invasion of Ukraine.
'If you want gas, find rubles,' parliament speaker Vyacheslav Volodin said in a post on Telegram.
'Moreover, it would be right - where it is beneficial for our country - to widen the list of export products priced in rubles to include: fertiliser, grain, food oil, petroleum, coal, metals, timber etc.'
... Since 2014 Russia has backed two similar breakaway Donbas statelets in Lugansk and Donetsk and recently recognised their independence.
The fate of these two self-styled 'people's republics' is central to ongoing peace talks, with Kyiv insisting they are still part of Ukraine.
Russia has long sought a land link between the republics and also-occupied Crimea via Mariupol, which is now encircled by Russian forces. ... "
Yesterday's related article on the Russian ruble - US dollar exchange rate:
https://el2017.blogspot.com/2022/03/russian-ruble-recovers-nearly-all-post.html
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