July 13, 2022 - 7:15am
Europe is bracing for record temperatures this week, but while many struggle in the sweltering weather, in just a few months time, dozens of Western nations could find themselves sliding towards a catastrophic big freeze.
On Monday, Russia cut off the Nord Stream pipeline, which carries around 55 billion cubic meters of natural gas from Siberia to consumers in Germany and beyond. According to the Kremlin, the stoppage is just part of “routine maintenance,” but analysts fear what is billed as a 10-day outage could become a pretext for Moscow to choke off the flow for far longer.
Berlin’s economy minister, Robert Habeck, is accusing Vladimir Putin of using gas “as a weapon” in retribution for EU sanctions. Germany is preparing for the worst, making £13 billion available to buy up reserves from other countries, as part of a race to fill up its storage facilities before winter, while the bidding war sends prices skyrocketing.
As Habeck admits, this is the “nightmare scenario.” For decades, Berlin was happy to depend on Russia for cheap fossil fuels and, it seems, successive governments never thought the day would come when Moscow put politics before turning a profit. As a result, they saw little reason to source alternatives.
In recent months, Europe’s largest economy has slashed its reliance on Russian gas from 55% to 35%. Now it’s not clear how much more it can do. Switching coal power plants back on may help to relieve some pressure on the electricity grid, but Germany’s heavy industries, manufacturing and chemical complexes have an almost unquenchable thirst for gas. If imports are disrupted, the whole continent, including the UK, will feel the shockwaves.
According to commodities analyst Nick Birman-Trickett, a prolonged cutoff “would trigger a massive supply crisis for German manufacturers and other European industries that depend on petroleum products, as well as households and businesses that rely on natural gas for electricity and heating needs.”
Rationing supplies, a drastic measure already pencilled in to Berlin’s contingency plans, would have to be brought in for the winter, as people turn on the heating. “We’re already seeing the start of that in the German economy,” Birman-Tricket told me, “and the fall of the euro to parity with the US dollar is indicative of the impact sky-high energy prices have.”
The economic fallout has been greeted with glee in Moscow, with Dmitry Medvedev claiming it is proof the EU has “shot itself in the head with a pistol made of sanctions.” According to him, Europeans are now “waiting for winter in their igloos, without our gas.”
Russia may depend on the proceeds of its fossil fuel exports to fund its brutal war on Ukraine, but it is able to disrupt them with few immediate consequences. The EU buys less half of the country’s total export volumes of gas, and the revenues from it pale in comparison to the proceeds from its oil industry.
EU leaders have reason to be worried, as Russia’s once-reliable energy network seems to be experiencing an unprecedented spike in politically convenient “maintenance issues” and other supposedly unforeseen problems. Last week, it ordered Kazakhstan to turn off the taps on its Caspian Sea oil pipeline over claims WWII-era naval mines suddenly pose a threat to the underwater link. The warning came days after the Central Asian nation pledged to increase exports to Europe.
A total blockade is, even for Putin, a nuclear option — you can only use it once, and when you do, you should expect consequences. If the bid to bring the West to heel fails, and the continent can get through the winter without Russian oil and gas, it is unlikely to ever jump back into bed with him, no matter how good the deal is. And as countries Saudi Arabia and Iran line up to take his place, there is no shortage of opportunities for Eurocrats to make the same mistakes again.
Gabriel Gavin is a Moscow-based journalist who has covered Eastern Europe for many publications.
GabrielCSGavin
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SubscribeWelcome back to something called “history.”
It was fun while it lasted (1991-2022). One could create any number of “discourses.” However ridiculous, they seemed to be the main issues of the day, and people debated them passionately.
But now most of them seem rather trivial.
Absolutely spot on.
The last line is key: “And as countries [like] Saudi Arabia and Iran line up to take his place, there is no shortage of opportunities for Eurocrats to make the same mistakes again.”
Because Iran knows how friendly we are to them and is desperate to have us a reliable customer that won’t use sanctions as a weapon – it’s not like we’ve ever sanctioned Iran before – oops!
“Berlin’s economy minister, Robert Habeck, is accusing Vladimir Putin of using gas “as a weapon…”.
I think this line is the key to all of this. The complete ineptitude of our “leaders” in thinking the West can do whatever it pleases, but the enemy can or should not. Does any average bloke or “deplorable” believe that spitting into the face of someone would not elicit a response? This is what happens when the West speaks loudly while carrying a very small stick.
You make a good point but it is remarkable how often in various fora parties seem shocked surprised and offended when there is push back.
Are you arguing for bigger stick or just for appeasing Russia?
People so beloved by Remeniacs like Merkel and Macron (independent European Army anyone, led by him?) are responsible for current mess.
Obviously Boris and his toothy rabbit were major contributors with net zero nonsense.
Europe with a stronger relationship with Russia than the US is not a threat to anyone but the US. Resource poor Europe could work with a resource rich Russia and within 10 years come out as the world’s strongest economy. So, it makes sense that both the US and China would want Europe to be poor, dependent, easy to buy, and cheap to visit for a vacation.
As it stands the war and canceling Russia is just a way for the US to stop Chinese influence in Europe. They simply see a Chinese tenacle coming through Russia into Europe, and so the war is the Great-Wall-Against-Chinese Hegemony.
They might be right, perhaps that is the only way to keep the West the West, because it seems unable to control itself from taking on Chinese funding and influence.
However, I think this war and the now soon-to-be impoverished and suffering Europe will be just a footnote in the greater conflict the US is headed towards with China in the East.
This is indeed the case. Europe is now the secondary theatre. US leaders have recognized this since at least 2012 with Obama’s ‘pivot to Asia’. The alliances with Australia, Japan, South Korea, and India are of greater strategic importance than anything that happens in Europe. Only Britain has any relevance whatsoever on American politics, and that’s largely sentimental or based on Britain’s traditional network of alliances in what used to be their old empire.
Er, you’re actually seeing it only from a US perspective.
The European response so far has been because Ukraine has a GREAT relevance for Europe.
Have you checked a map recently?
Please define Europe in your argument for “stronger relationships with Russia”.
Clearly you have no problem with Russian genocide in Ukraine.
So what is your limit?
Conquest of Baltic States by Russia is ok?
Poland as well?
Who else?
Before Russia invaded Ukraine, pro Russian musings like yours were more difficult to refute.
Advocating pro Russia policy now makes you no different to Hitler appeasers.
The last part is the key.
Once Russia does this, it essentially makes all its western gas fields worthless. They aren’t connected to China, and won’t be for many years.
Putin may still see a total shutoff as the only way to create a neo-Russian Empire.
But just now,
1) Russia is losing most of its artillery ammo–the only means it has had to take even a tiny portion of Ukraine.
2) It can only respond by using inaccurate surface to air missiles to attack ground targets (!).
3)And still Putin dare not call a mobilization, since it’s “not a war.”
Cutting off gas revenues in the middle of a war seems more likely to force Russia to implode.
The colossal incompetence of leadership in the West has led us to this point. Successive leaders from Clinton to Biden, from Blair to Johnson, from Kohl to Scholz, have allowed this to happen. Their faith in the liberal world order led to a certain naivete about economic warfare. It simply never occurred to successive generations of leaders that anyone might simply refuse to play by their rules and/or use those rules against them, but the free trade doctrine and the separation of economics from politics has always been a peculiar notion of the west, particularly for the British and American Empires whose military power gave this notion whatever power it ever possessed. The leaders of Europe and the US must face the reality that we have been outmaneuvered by Putin and Xi who never intended to play by any set of rules but their own. They always knew what they were doing. Putin built up the EU’s gas dependence on purpose to use as a political weapon and China monopolized entire industries for the same reason, leverage. It was always about politics, building dependencies that could be leveraged against enemies for political concessions. Anyone with even a vague notion of how national power has worked throughout history should have seen this coming, but our leaders faith in their vision of globalist utopia, the so called “End of History”, blinded them. Crawling out of this hole is going to take a fundamental shift in our political cultures. I’m not sure we have it in us, but necessity is still the mother of invention.
Yes. Well said. Shame our establishment and political masters lacked the wit to see through all this for 30 odd years.
Nice summary thanks Steve – and again one must ask where were the multitude of overpaid analysts in all this – tasked with supplying clarity to world leaders ????? As someone else has mentioned the voters must take much responsibility for NOT supporting those leaders who may have been able to make wise but unpalatable decisions over the past 30 years. We get the politicians we voted for …..Those of us who have been somewhat aware of these dynamics have been making our plans for a modest retirement in a pretty place whilst reading the daily news as an ongoing tragi-comic soap opera………
Great post.
I have no problem with people pointing out idiocy of Western policies against enemies till they start saying it is too late to do anything and we should just surrender.
Then they are just Russian or Chinese stooges.
But nice to see them shift so quickly to great power politics.
However deluded they were, the older ones still had to study European history.
And in the last 500 years, Europe has never tolerated a leader like Putin.
Period.
This is all pretty funny, not mentioning how the West started the whole economic sanctions thing, or specifically how those sanctions block the Russians from the technical resources that have largely built and maintained the energy infrastructure on which the West depends. No surprise there are increasing technical problems, but who is responsible for them is largely unknowable.
Stupid is as stupid does.
Well – I am enjoying this. Even mainstream sites are playing – and people are upvoting – videos of Trump berating and warning German leaders several years ago about this. Reality is just so inconvenient.
And entertaining.
Yes, I’ll be able to report back on this from the front line when winter rolls around. That is, if we haven’t had such a comprehensive blackout in AT that I can’t turn on my electrical appliances.
Sanctions are usually virtue signalling as they rarely solve a problem. With Russia they have predictably backfired. The West cannot stop Russia selling oil so they need to focus world diplomacy on reducing the price, pragmatically. The lower the price the greater the risk to Putin in curtailing supplies of gas to Europe. It will not be popular but when the oil price is lower enough consumption should be taxed to hold demand down and drive producer prices down further.
Except it’s doing the opposite, duh.
German’s foreign minister accused Russia of “using gas as a weapon”. Well, yeah. That’s what you do to an enemy.
Russia declared war on Ukraine. The US/EU block declared economic war on Russia. Why would they sell gas to someone who has thrown in with their enemy and has publicly called for their leader to be deposed and their government toppled? Why would they sell gas to countries that have seized their sovereign assets and those of their leading citizens? The fact that the German foreign minister (and apparently much of the EU leadership) was too myopic to consider their risk exposure before doing these things is truly astounding.
The answer is really:
Why would Putin permanently risk losing the only customers for his western gas fields?
The moment he shuts off the gas is the moment that he can never sell it here again. Europe will then have to get by with LNG, solar, wind, and nuclear.
If you’d stolen all my money and assets do you seriously think I’d sell you my stuff? I’d more likely send you something hypersonic, which is what Germany and specifically London should be worrying there thieving little heads about.
You are nothing more then pathetic Russia appeaser, even assuming your name reflects your location.
It was Russia which decided to invade.
Are you saying actions should have no consequences?
West defeated Soviet Union, so defeating Russia should not be a problem if there is will to do it.
I agree that last bit might be a problem.