March 15, 2025 - 8:00am
As negotiations over a ceasefire in Ukraine intensify, US President Donald Trump has said that he hopes “Russia will do the right thing” and accept the current terms. While Vladimir Putin has cautiously heaped conditions on any ceasefire, there are reasons to think he may be forced into accepting the deal.
Take, for example, the recent news of Gazprom’s economic troubles. According to Reuters, the Russian gas giant is considering selling some of its prime real estate in St Petersburg and is also planning a considerable reduction of its workforce. While Russia was well prepared to withstand Western sanctions for a prolonged period, it could never do so indefinitely and Moscow is starting to feel the economic strain. Trump knows this, and this week said that if Russia snubs a ceasefire deal he would “do things financially that would be very bad for Russia, would be devastating for Russia. But I don’t want to do that because I want peace.”
The Russian pipeline network on which Putin’s war machine relies has been designed for over 40 years to supply oil to Western and Central Europe. But these arteries are running dry: Gazprom’s sales through the Urengoy-Pomary-Uzhhorod pipeline ended when it was shut down in December last year. With the additional closures of the Nord Stream and Yamal pipelines, Gazprom’s only remaining route for transporting gas to Europe is through Turkey, using the TurkStream and Blue Stream pipelines beneath the Black Sea. Gazprom’s exports to Europe via pipeline have dropped by 75% and the still-developing new pipelines aiming to supply China and Asia cannot make up the difference. Even the most ambitious projects being contemplated to transport gas eastward would not reach half of the previous annual peak exports of 180 billion cubic meters.
Moscow expected a swift victory in Ukraine and, as a result, a temporary disruption of the gas trade, as happened with the annexation of Crimea in 2014. Russia no doubt thought exports to Europe would quickly return to normal. This calculation was not entirely baseless, since as late as January this year there have been debates among EU member states to restart buying Russian gas in the case of a ceasefire. Yet, as time passes, Russia’s position as one of Europe’s main energy suppliers is gradually eroding, and Putin might be overplaying his hand by delaying a ceasefire.
Gazprom competitors like Novatek are still providing liquified natural gas (LNG) to Europe, often in larger amounts than in the past. The LNG market, however, appears to be heading for a glut with more and more capacity from the US to Qatar coming online. While this could still take two or three years to fully materialise, it will massively weaken the long-term position of Russia as an energy exporter.
This gas glut is going to be a problem for Putin: if the price of gas and oil collapses because the world is overproducing, the Europeans will have an even easier time finding alternatives. This is not going to solve the problems of the EU’s flawed energy policies, but it will certainly strengthen its position vis-à-vis Russia. Assuming that the Kremlin is aware of these conditions, one could expect the Russians to remain at the table.
Moscow has been incredibly lucky that Europe decided against nuclear and fracking as reliable energy sources. Instead, the EU waited for the non-Russian world’s gas reserves to come online. The resultant high prices incentivised US and Middle Eastern LNG production to such an extent that there may be no space for Russia to regain its market share. As the ceasefire negotiations proceed, Putin will surely be assessing the perilous state of the Russian oil and gas industry.
Ralph Schoellhammer is assistant professor of International Relations at Webster University, Vienna.
Raphfel
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SubscribeMoscow wasn’t just ‘lucky’ that Europe decided against fracking- Putin spent $95M inserting anti-fracking scare stories into the media via NGOs and campaign groups.
There was plenty of home-grown stupidity and virtue-signalling as well.
Which was prevailed
Pocket change
If Europe ever goes back to directly buying Russian oil and gas they want their head testing
Canada and Venezuela would be great sources for heavy crude.
I think now is an ideal time to start buying from the Canadians.
Making the yanks more reliant on the Venezuelans as a result of Trumps nonsense would be a funny outcome
I occasionally fantasise about CANZUK acting as a counterweight to the US, but the military reality is unlikely to change.
If Canadian politicians ever get too tough with the US, the Americans will just invade.
Americans between 3%-3.5% on defence, compared to around 2% for most of Europe.
However thanks to the dollar being the reserve currency they’re able to run the kind of deficits that would bankrupt most European nations. If they ever lose that (and alienating their allies and trading partners is a good way to go about it) then their military budget would have to contract massively
Unfortunately Venezuela has a “bad guy” running it too.
But he’s highly unlikely to have much interest in invading or crippling Europe and it would seriously stick a middle finger at both Putin and Trump. Plus he’s desperate for foreign currency so a VERY lucrative deal could be made.
“ Moscow has been incredibly lucky that Europe decided against nuclear and fracking as reliable energy sources”
Not just luck! They’ve worked hard for many decades to cultivate the hard left, eco warriors, pseudo-science, anti-west sentiment, racial division, peace lobbies, etc. throughout the western democracies.
It’s funny how things turn.
For years it was the left who were the Kremlins “useful idiots” criticising the west snd ignoring the crimes of the Soviet Union. These days it’s usually the online right who blindly regurgitate the Russians propaganda and berate the west
The trick is to realise that Russia isn’t the only country ruled by a psychopath.
Anyone who trusts any government anywhere is a useful idiot.
Actually, I am used to lies from both sides. I dig for the truth. What comes out of the Kremlin is far more relyable that what many “Western” sources spout.
Anybody remember the first days of the war, when we were all aghast at Russian Tanks blazenly squashing motorists in Kiev?
Within days, unpartial bloggers, were pointing out that that “tank” was a motorized AA platform. Now, you may have a low opinion of Russian military tactics, but I doubt they’re stupid enough to to try and take Kiev with AA batteries. (It was also pointed out that the AA gun, was of a type that Kiev had on hand from old USSR equipment).
Do you remember the pictures of cars lined up at the Russian borders, showing every one who was fleeing “Putin’s War”. Didn’t take a rocket scientist to notice all the green in the trees and fields. Something that you wouldn’t see until very late spring or summer. Obviously, these lines were of tourists on holiday.
Finally how many stories did we hear, that Ukraine was winning, that between massive casualties and the sanctions, Russia would collapse soon. (That mantra when on for years, as as this article shows, it is still in vogue).
I have been watching the fake MSM news for over 30 years. They haven’t changed very much and it doesn’t take much for a self trained observer to spot the flaws. Not only that but I think ask questions and have a good knowlege of history. I have found the Kremlin’s statements, far more reliable than that of MSN or BBC.
WHY????
Why not just get along? Europe is strangling without affordable gas. LNG is not affordable when compared to Pipeline gas – this is a 100% self-inflicted wound on Europe’s part.
Yes, USA is making money, but Europe loses it.
How can everyone not see that Russia is Europe’s Canada? The vast resource supply to feed an industrial need in the EU and UK wile being culturally and historically aligned? Just think if all got along, what a better world it would be.
The ‘Neo-Con’ pro war chancers in the West tried their thing and lost. Now is time to return to sanity before Europe collapses economically. Why harm Russia by self harming Europe? That is ‘Lose-Lose’, how about peace and trade and ‘Win-Win’?
Russia’s economy is tanking? I think you need a dose of reality:
https://www.tradingview.com/symbols/RUS-MOEX/
Not mentioned here is the fact that the sanctions imposed by the west are a double edged sword. Not only do they hurt our economies as much as the Russians, but they have helped create BRICKS as a real organization.
The dollar is closer than it have ever been to cease to be the reserve currency of the world. If and when that happens, the US debt is going to become unsupportable.
Up to now, most coutries have enjoyed the convenience and security of the dollar as reserve currency enough that they have not minded allowing the US to service its debt at next to nothing. However, the hidden cost of sanctions has given the rest of the world a good reason to mind. What goes around, comes around. If the US can sanction Russia like this, who is safe?
The global south, while not ditching the dollar, is hedging its bets with BRICKS and many other bilateral trading schemes. Economically, the West might be suffering far more from this war than is Russia.
A combination of Shale Oil and Gas plus Under Ground Coal Gasification would solve our energy problems.
Problem. The sycophants surrounding Putin have not made him aware of these issues.
That doesn’t sound like a problem for the rest of us
I’ve always said that the West should have given Ukraine missiles with sufficient range to destroy Russian hydrocarbon production facilities wherever they were in Russia, as it was obvious that this was the weak spot in its economy. Hopefully when the war is over, Western Europe has the sense to freeze Russia out of its hydrocarbon markets in perpetuity.
Obviously, you would like WW3. You really think that the Russians would not retaliate?
MM does not do thinking. Put him on a front line and all you would see is somewhere to park your bicycle.