Russia’s Energy Extortion of Poland and Bulgaria

Source: Wall Street Journal.

WSJ accuses Russia of extortion, but the accusation doesn’t hold water. European companies can easily purchase Russian natural gas and oil in Euros using the currency conversion procedure set up by Gazprombank. There is no breach of contract as WSJ alleges.

There are a number of fascinating factors at play in this story. One concerns the basic law of contracts, which assumes a contract to be an agreement to exchange value for value. Since the current batch of sanctions makes it impossible for Russia to spend euros as it wishes, trading gas for euros becomes an exchange of value for nothing. That is, if anyone is guilty of breach of contract, it would be Russia’s European gas and oil customers.

But this highlights another of the fascinating factors in this story. By agreeing to convert euros to rubles, Russia recovers part of the $300 billion in foreign reserve currencies the sanctions impounded, while at the same time allowing Russia to increase the quantity of rubles circulating in its own economy without risking inflation.

It appears that Europe and US attempts to hurt Russia with sanctions may actually have the opposite effect.

19 thoughts on “Russia’s Energy Extortion of Poland and Bulgaria

  1. NATO, including Poland, is supplying arms to Ukraine and acting as a conduit for arms coming from us, to kill their soldiers, so I really don’t see where they have much to complain about if Russia doesn’t provide them the gas to keep their lights on.

    Demanding Rubles as payment is pretty damned reasonable.

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    1. …”to kill their soldiers,”

      Easy solution: STOP THE FREAKING INVASION. Then the Russian soldiers will stop being killed.

      Why do you hate the idea of a country defending itself from foreign invaders so much? You want Ukraine to be as spineless as Kevin McCarthy and the other Trump-fearing GOP members of Congress?

      For someone who proclaims a love of liberty, you sure do have a strange way of showing it for others.

      Liked by 1 person

      1. Ukraine forfeited its sovereignty by failing to abide by the terms of the Minsk agreements. Having no sovereignty, there was no “self” to defend.

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        1. If that were truly a legitimate argument, then we could have invaded Russia any time they failed to abide by any of the SALT agreements.

          And the next time we fail to abide by a treaty or agreement, the aggrieved country is then free to invade our shores.

          Your excuse for an invasion by Russia is just so much fertilizer.

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        2. RE: “If that were truly a legitimate argument, then we could have invaded Russia any time they failed to abide by any of the SALT agreements.”

          Yes, we could. Why do you think we didn’t?

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          1. Because this country believes in diplomacy and peaceful means of settling conflicts. We don’t go off halfcocked because we THINK someone peed on our shoes.

            Putin’s invasion of Ukraine is based on a sheer desire for power and control on his part. And to cement a legacy that reestablishes the old Russian empire. If you don’t see that as the reasoning, there is no way to convince you otherwise.

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          2. RE: “Because this country believes in diplomacy and peaceful means of settling conflicts.”

            That would be hard to prove, given Vietnam, Korea, Iraq, Lybia, Afghanistan and so on.

            My answer: We never attacked Russia because Russia could hurt us as much or more than we hurt them. Their agency gives them sovereignty that we (and Ukraine) are bound to respect.

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          3. Vietnam – Red Scare that was all the rage in the 50’s and 60’s. Korea – Ditto, Iraq – Bad move the SECOND time; protecting Kuwait the first time was not a bad thing to do. Afghanistan was the training site for the 9/11 attack. Libya – Meh. You brought them up before and I provided an HISTORICAL explanation as to the why’s we went in (And I was not in agreement with them, nor did I defend them (Kuwait being the outlier); I just called them out for what they were) you sopped talking about the. So here is your excuse to stop talking about them again.

            SO I ask again: What provocation, legitimate provocation, did Russia have for annexing Crimea in 2014 and now the invasion of the entire country? There was no government sponsored attacks on ethnic Russians in the East; there was a country defending itself from enemies INSIDE their border.

            “Their agency”…

            Agency? WTF? Agency means “more powerful” by your use of it here. – IMO They are a more powerful country and they decided to take over a neighbor. I guess you would be just fine with the US taking over Canada or Mexico. Our military is bigger and stronger than theirs. It would be the same damned thing.

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          4. RE: “You brought them up before and I provided an HISTORICAL explanation as to the why’s we went in.”

            The explanations don’t matter. The U.S. routinely violates the sovereignty of other nations. Maybe you think it’s right when we do it, but wrong when Russia does it. I think its hypocritical.

            RE: “What provocation, legitimate provocation, did Russia have for annexing Crimea in 2014 and now the invasion of the entire country?”

            The residents of Crimea voted to rejoin Russia. And, as I said, Ukraine gave up its sovereignty over the breakaway republics by failing to abide by the Minsk agreements.

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          5. I did not say right or wrong. I pointed out the times and reasoning for each one of those instances. Just like divisive concepts, you want to ignore the history of those conflicts.

            The residents of Crimea voted to rejoin Russia because they were faced with a lot of little green suited men who would have killed them if they didn’t. That’s not democracy; that’ Russian style elections: Vote for Putin or die or disappear.

            ANd just because there was a vote of that nature, does not mean the Ukrainian government has to abide by it. THere was a vote by Oregon counties to join Idaho. SHould Idaho invade Oregon to make it so?

            Liked by 1 person

        3. “Ukraine forfeited its sovereignty. . .”

          Polly wanna cracker?

          There was obviously no such provision. Not surprisingly your “analysis” concluding there is no sovereign Ukraine to defend is totally absurd nonsense.

          And, as a matter of fact, it was Russia who did not call off the dogs and it was Russia that did not abide by the most important part of the Minsk agreements when it recognized breakaway “republics” as sovereign nations.

          Liked by 1 person

        4. RE: “There was obviously no such provision.”

          There didn’t have to be. You apparently don’t think Russia has a right to expect Ukraine to uphold its contractual obligations.

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          1. Your logic is busted and your facts are wrong. There is no penalty clause and, anyway, Russia broke the “contract” not Ukraine. Russia kept up the military pressure and support for criminal separatists from 2014 onward. Russia recognized the puppet governments as sovereign.

            You ought to be embarrassed parroting easily disproven Putin propaganda, but I don’t suppose you are.

            When you make a fool of yourself on behalf of Putin maybe you should be reminded that there was indeed a formal treaty violated BY RUSSIA.

            In 1994 Ukraine gave up nuclear weapons (third largest arsenal in the world at that time), joined the Non-Proliferation Treaty and by 2001 had given all its nukes to Russia. In return Russia committed to never using or threatening military force against Ukraine except in self-defense. Putin’s invasion of Crimea, its military intervention in Donbas and now this invasion are all violations of those solemn commitments.

            Liked by 2 people

          2. The non-proliferation agreement should throw a curveball to those who are riding the “Putin as victim train”.

            Which seems to follow the “Republicans as victims” script pretty closely.

            But shameless revisionist history is a major plank in the minority party platform.

            Liked by 2 people

          3. RE: “In 1994 Ukraine gave up nuclear weapons (third largest arsenal in the world at that time), joined the Non-Proliferation Treaty and by 2001 had given all its nukes to Russia.”

            Irrelevant. Ukraine’s failure to honor the Minsk agreements are the issue at hand.

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          4. “Irrelevant.
            Ukraine’s failure to honor the Minsk agreements are the issue at hand.”

            Irrelevant? That of course is bullshit. It is HIGHLY relevant adding another clear element of war criminality to Putin’s invasion. “Good guys” give up nukes. “Bad guys” attack them anyway. Even a child could understand.

            Ukraine did not fail to honor the Minsk agreements. That was Putin. You people ALWAYS think you get your own facts. You don’t.

            Liked by 1 person

          1. You should educate yourself. International observers have reported that both Ukraine and Russia violated terms of the Minsk agreements. Under those circumstances, the agreements became void, such that Ukraine’s sovereignty was no longer valid.

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          2. Which international observers and when? And Russians sovereignty remained intact, but not Ukraine’s?

            We broke numerous treaties with Native American tribes, so we have no sovereignty either?

            Whether you bother to address those questions or not, Russia had no right to invade another country anymore than we have a right to invade Mexico because too many immigrants are crossing the border.

            The only reason Putin is invading Ukraine and has destroyed so many people and cities is because he has nukes to back up a failing conventional military capability.

            Ukraine was occupied by Stalin, then Hitler, then Stalin and his successors. They don’t want Russian dictators again.

            Liked by 2 people

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