Alleged whistleblower Russian FSB officers declare that the war is lost, mobilization is not possible, Putin isolated (a chaotic decisionmaker), can't even count the dead, the nuclear button a bluff, how to win still if Zelenskiy signs a "soft" peace agreement.
Reason for the letters: to avoid the purges which have already begun.
The future of the Nord Stream 2 gas pipeline will be in question if Moscow does not make serious concessions.
At best, its commissioning will take place in June next year and only if Russia fulfills the preconditions that will prevent the Kremlin from using this pipeline as an instrument of political and economic pressure. Such a forecast in the Washington edition of The Hill is made by Professor Emeritus of the University of Houston, researcher at the German Institute for Economic Research, economist Paul Gregory.According to Paul Gregory, the first statements by members of the new coalition government of the Federal Republic of Germany, where the majority were Social Democrats, sounded partly sensational. Germany's new foreign minister, Annalena Berbock , a Green Party spokeswoman long known for her skepticism about Nord Stream 2, announced in a Sunday television interview that the new pipeline could not be operational as members of the government coalition believe it does not meet the requirements of European energy legislation. A few days ago, the new German chancellor Olaf Scholz in response to a question whether Nord Stream 2 could be used as an instrument of pressure on the Kremlin to prevent a possible Russian invasion of Ukraine, he said that such a move by Moscow would have consequences, which, according to Paul Gregory, means that the Kremlin will have to pay with Nord Stream 2 in the event of an attack on Ukraine.
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- The problem for Gazprom is that if it is forced to comply with these requirements, the competitiveness of Nord Stream 2 will plummet. Gazprom will not be able to act as a producer and supplier of gas. He will have to allocate a certain share of the capacity of his gas pipelines to transport competitors' products. All rates must be made public. From my point of view, these conditions are unacceptable for Gazprom. I assumed that Germany might allow, roughly speaking, a shell company to take over the transportation of gas in order to separate producer and supplier. The new German government, apparently, will not allow this. Among other things, the start-up of the gas pipeline must be approved by the European Commission, which initially opposed this project,
- The use of Nord Stream 2 as an instrument of pressure in the event of meeting European requirements will be impossible, and in fact it was conceived in many respects in order to exclude Ukraine as a transit country for Russian natural gas. The capacity of Nord Stream 2 is close to the capacity of gas pipelines passing through the territory of Ukraine. Russia, of course, needs the money it can get by putting into operation a new gas pipeline, but I think the ability to use gas as an instrument of pressure is still more important for it.
According to Paul Gregory, the current US sanctions and the possibility of new sanctions also continue to pose a serious problem for Nord Stream 2:
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- The Senate is very decisive about the sanctions against the gas pipeline. And now there is a struggle between the Senate and the administration, which, as you know, has decided not to subject the pipeline operator to sanctions. But the existing sanctions are very tangible for Gazprom, because any European company related to Nord Stream 2 is in constant danger, it could become the target of US sanctions. This threat is taken seriously by any business.
It is possible that in these new conditions, the future of Nord Stream 2 will be in question, says Paul Gregory:
- In my opinion, we can say that the fate of the gas pipeline is in question. So far, there is no answer to the question of whether it will be possible to start its operation in June 2022 or the process of obtaining final approval for its launch will drag on for several years. If I had been asked this question two weeks ago, I would have answered in the affirmative: yes, it will be launched in June. But the picture was radically changed by the comments of representatives of the new government coalition in Germany, although it has been in power for only a few days, so it is too early to draw final conclusions, says Paul Gregory.
Western powers often characterize Russia as a rogue state with nuclear weapons and a military disproportionate to its frail economy. Russia is the largest supplier of raw materials to the world economy. Its president, Vladimir Putin, does not let a trouble-making opportunity go to waste.
The new Biden administration has the responsibility of dealing with Russia that has forcibly changed Europe’s boundaries (Crimea), initiated a “separatist” war in East Ukraine, quasi-annexed parts of Georgia, shot down a passenger plane (MH17), intervened in Syria on behalf of Bashar Assad, interfered with foreign elections, assassinated regime opponents at home and abroad, kidnapped sailors in international waters and denied freedom of navigation on the Black and Azov Seas.
But Ukraine remains at the heart of Washington’s Putin Problem.
After Ukraine unseated its pro-Russian president in 2014 to pursue a policy of integration into the West, Putin has sought to unravel a democratic Ukraine through his proxy war in “separatist” Donetsk (DNR) and Luhansk (LNR) “peoples’ republics,” both governed by Moscow viceroys. The Kremlin’s propaganda campaign claims that Ukraine never has and never will be a nation, that it is run by crooks, neo-Nazis, and extremists who victimize Russian speakers.
In a word, the Kremlin hopes to convince the West that Ukraine is not worthy of support. Putin is now directing this message at President Joe Biden and his inner circle, perhaps with some success.
The West has had almost a decade to learn how to deal with Russia. Its preferred instrument has been sanctions to punish Russia for specific criminal acts, such as the shooting down of MH17 in July of 2014 or the poisoning and imprisonment on sham charges of Putin opponent Aleksei Navalny. The Trump administration, joined by the European Union, also levied stiff sanctions on companies associated with the new undersea pipeline (Nord Stream 2) from Russia to Germany. Nord Stream 2 would replace the Ukrainian pipeline network that has transported Russian gas to Europe through Central Europe for decades.
The West imposes sanctions on Russia as an incentive to improve behavior. If Russia were to, for example, admit guilt for shooting down MH17 and compensate relatives or release Navalny, the associated sanctions would be lifted.
So far, this strategy has not worked.
The Western world had every reason to expect that the new Biden administration would impose tough new sanctions on Nord Stream 2. After all, Biden publicly declared Nord Stream 2 “a bad deal for Europe” after declaring that Putin is a “killer.” Moreover, Biden let it be known that new sanctions for the Navalny affair were in the works.
To nearly everyone’s surprise the Biden administration announced on May 19 that it was waiving Nord Stream 2 sanctions, despite the fact that a strong bipartisan Senate majority supports new sanctions.
Biden’s stated rationale for clearing the way for the completion of Nord Stream 2: Trump, as President, damaged Washington-Berlin relations by criticizing Germany harshly for not meeting its commitments to NATO. Hence, the US should repair relations with their most important ally by supporting Angela Merkel through the Nord Stream 2 deal before she leaves office in September. Already gas production in European Union is declining, with Germany alone expected to increase consumption of natural gas by 20 Bcm by 2034 to 110 Bcm. The Nord Stream 2 pipeline under the Baltic would effectively bring more supply from reserves in Russia to Germany as well as to other countries in the EU. German officials project the pipeline o lower gas prices by 13% and allow Germany to decommission all nuclear power plants and coal plants by 2038 – as called for by Germany’s Energiewende.
By contrast, much of the EU, despite the opportunity to reap economic and environmental benefits of the Nord Stream 2 gas pipeline fear it as an instrument of Russian domination. As well, following Merkel’s departure in September, elections may usher in a change in Germany’s position on Nord Stream 2.
Without a doubt the big winner from Biden’s decision is Moscow. The big loser is Ukraine and the Kyiv-Washington relationship.
Vladimir Socor of the Jamestown Foundation regrets the loss of western credibility in Ukraine, and a perceived “downgrading of Ukraine on the scale of Western policy priorities” taken in deference to Russia, in particular the exemption of Nord Stream 2.
Ukraine understands that timing was not a coincidence. The waiver announcement was made on the day of the Blinken-Lavrov meeting to prepare for the Biden-Putin summit scheduled for June 19 in Geneva. Nord Steam 2, Ukraine believes, is Biden’s gift to Putin to entice him to the Geneva summit.
Ukraine reacted in a burst of diplomatic fury to what it perceived as the Biden betrayal. Washington did not even extend the courtesy of advance notice of the upcoming Nord Stream 2 waiver. Ukraine President Volodymyr Zelenskiy characterized the lifting of sanctions on Nord Stream 2 as a “defeat of the United States, a personal defeat of President Biden in terms of standing up to Russia […] a major Russian geopolitical victory, and a redistribution of power and influence [in Europe].” Zelenskiy went on to declare to be “personally worried about possible tradeoffs” at the Biden-Putin summit adversely affecting Ukraine.
The former Ukrainian foreign minister, Pavlo Klimkin, declaring that the US decision came as “a blow to the gut” to Ukraine and that “any signs of a crisis of confidence between Ukraine and the United States would be the worst thing that could happen at this time.”
The backlash to President Biden’s Nord Stream 2 decision required the White House Press Secretary, Jen Psaki, to declare that Washington "doesn't regard the meeting with the Russian President as a reward; we regard it as a vital part of defending America's interests." That the White House had to deny on record that Nord Stream 2 was a “bribe” to lure Putin to a summit is telling commentary.
Moreover, two fellows of the influential Council on Foreign Relations published in The Hill a “Green” apologia for Biden’s actions on May 20. The story, entitled “How to Turn Nord Stream 2 Into a Win for Ukraine,” contends that Ukraine’s loss of the gas transit business is a blessing in disguise. It frees the Ukrainian budget from reliance on carbon energy, and it allows Ukraine to focus on green energy. After all, in the long run, the world will be carbon free, so Ukraine can be at the forefront of the green energy revolution. As to Europe, the authors contend that Nord Stream 2 just replaces the capacity of the Ukrainian pipeline system. Overall gas volumes will be unaffected, so the gas price will be unaffected. Not to worry, Nord Stream 2 will have to obey German competition rules.
However, control of gas pipelines bestows considerable power over price and quantity. Given the substantial clout of the Russian lobby and its cyber warfare capacity to take out rivals, the Gazprom supplied Nord Stream 2 will not be a paragon of the competitive model.
The rules of the game have been that the US and EU were on Ukraine’s side and would do what is possible for Ukraine. Germany’s interests appear to supersede Ukraine’s, and incidentally favor Russia at the expense of Ukraine. But the Biden administration’s actions with respect to Nord Stream 2 and its rush into a one-on-one summit with Putin raise the question of whether this basic understanding has been broken – namely that the Biden administration does not regard Ukraine’s entry into the Western world as vital to the West’s interests.
Russia’s state gas company, Gazprom, makes no bones that it is an instrument of Russian foreign policy and power, not a commercial undertaking. What goes unmentioned is that, given the importance of gas revenue to Putin’s Russia. Russia cannot invade Ukraine so long as a considerable portion of its gas pipeline traverses through Ukraine. With Nord Stream 2 in full operation, Putin can invade at his convenience and a natural gas dependent Europe will do nothing except keep on buying Russian gas. If this is the cost of a greener energy mix, is the West willing to pay it?
Western media is greeting the Biden administration’s Russian sanctions as “signaling a tougher stance on Russia than under former President Donald Trump.” Vladimir Putin likely thinks otherwise.
It looks as if the Biden administration has blinked on Putin’s key foreign policy objective — the completion and operation of the Nord Stream 2 pipeline, delivering Russian gas to Europe. The sanctioning of a few Kremlin officials is petty change compared to the decade-long profitable effects of Russian pipeline politics.
