A confident Kremlin is throwing its weight around.

[TigerPaws]

[size="3"]B[size="4"]y Owen Matthews and Stefan
[/size][/size][size="4"]Newsweek International[/size][size="4"]Jan. 30, 2006

 issue - No need to call in the Kremlinologists. Russia's latest messages to the West and its close neighbors are clear. First came the New Year's Day gas war, when Moscow cut gas supplies to Ukraine over a pricing dispute--and demonstrated to the world that it was ready and willing to use energy as a weapon. Then came an essay from Defense Minister Sergei Ivanov entitled "Russia Must Be Strong," full of nuclear swagger and warnings that foreign interference would not be tolerated in Russia's backyard. And now, as neighboring Belarus and Ukraine prepare for elections in March, Moscow is doing everything in its power to ensure that wayward former satellites return to its orbit.

[/size] [size="4"]Delusions of empire? Clearly, after years of weakness, a resurgent Russia is striking back. "Russia is a very different place from the way we saw it just three or four years ago," says Katinka Barysch of London's Centre for European Reform. Its rulers believe they don't need to defer to anyone anymore, and the reason is obvious. Buoyed by high oil prices, a booming economy and a hefty 7 percent budget surplus, Moscow can afford to throw its weight around in a way it's been unable to do in a generation. The gas war was a slap not only to anti-Russian Ukrainian President Viktor Yushchenko, but also a signal to Europe and the world at large: don't trifle with us.

[/size] [size="4"]Sensing this new confidence, Europe has begun to reappraise its powerful eastern neighbor. Last week all eyes were on the new German chancellor, Angela Merkel, and her first Moscow meeting with President Vladimir Putin. Eager to draw a line under her predecessor Gerhard Schroder's cozy relationship with Putin, she played up human rights and spoke of German disagreement with Russia's bloody war in Chechnya. Pointedly, she went out of her way to meet with Russian NGOs threatened by a repressive new law they fear will put many out of business. What's more, Merkel has said many times that she wants to bolster ties with Germany's traditionally close neighbors in Eastern Europe, who've been openly critical of Schroder's friendliness with Putin.

[/size] [size="4"]Yet Merkel wasn't exactly tough, either. She "made very gentle and friendly comments on the situation in Russia," said Putin. The reason for the softly-softly diplomacy? Like Schroder, Merkel must ensure continued supplies of roughly 30 percent of Germany's oil and gas--not to mention safeguard trade with Russia's booming petro-economy, an increasingly important market for German companies from equipment-maker Siemens to construction giant Hochtief. Thus Merkel has put the word out to her advisers: use all channels to prevent any crisis in relations with Moscow, including activating Schroder's close personal ties to Putin, sources close to the chancellor tell NEWSWEEK.

[/size] [size="4"]The same goes for the world's Iran diplomacy. Like Moscow or hate it, Europe and the United States have little choice but to deal with Russia if there's to be any progress in the growing conflict over Tehran's suspected nuclear-armament plans. But while Russia's willing enough to play the partner, it won't trim its strategic sails for anyone. Late last year Moscow unsuccessfully offered Tehran a deal to enrich uranium at a facility on Russian --soil. Rebuffed, Russia is reluctantly coming round to referring the matter to the United Nations Security Council. But at the same time Moscow has ignored calls from Washington to suspend a program of building civilian power stations in Iran and has been actively marketing missile defense systems to Tehran.

[/size] [size="4"]Russia's newfound assertiveness is sharply evident in Ukraine, where the Kremlin seeks to undermine the 2004 "Orange Revolution" that turned out a Moscow-friendly regime and ushered in a band of West-leaning political and economic reformers. So far, its major triumph has been to encourage Yulia Timoshenko, the celebrated "Orange Goddess," to turn against her former ally Yushchenko. Denouncing her as "anti-Russian," Moscow all but refused to recognize her appointment as Ukraine's prime minister initially, pointedly citing criminal charges pending against her (for alleged bribery of Russian Defense Ministry officials in 1996) and effectively barring her from visiting Russia even on official business. But when Yushchenko fired Timoshenko last September, she was transformed overnight from an outlaw to honored guest. Charges against her were mysteriously dropped. A visit to Moscow soon followed, where, according to former Economy minister Sergei Terekhin, she met with Putin privately. Suddenly, Timoshenko became Yushchenko's most vocal critic, accusing him of corruptly benefiting in the deal that ended the New Year's gas crisis--so far without proof. (Amid the hubbub, Kiev and Moscow last Saturday postponed signing the agreement for another week.) "We regard Yulia as our ally," says Sergei Markov, a Kremlin political consultant. "There is nothing anti-Russian about her."

[/size] [size="4"]Timoshenko has proved a deadly opponent for Yushchenko. The reformist president's parliamentary bloc, led by his Our Ukraine Party, is suffering badly under the assault, polling only 13 percent compared with Timoshenko's 16 percent--and, worse, trailing far behind his nemesis in the Orange Revolution, the former prime minister under the old regime, Viktor Yanukovych, with 31 percent. If Yanukovych's Party of the Regions wins in the coming parliamentary ballot, he could again become prime minister or nominate his own pro-Moscow candidate, effectively sounding the death knell for Orange hopes of political independence from Moscow. And last week, just to remind Yushchenko once again who's boss, Russia suspended imports of Ukrainian meat--another small turn of the screw.

[/size] [size="4"]Meanwhile, what of the EU? During the recent gas war, Brussels showed itself powerless to help Kiev. "Ukraine hoped that Europe would threaten Russia with sanctions," says Markov. "That didn't happen." While Europe willingly embraced the first round of Eastern European nations to break out of the Soviet sphere, it's clearly not going further. Preoccupied with its own problems--high unemployment, low growth, immigration troubles--the Union is in no mood to contemplate membership for impoverished Ukraine. And when push comes to shove, Ukrainians know that few major European nations will jeopardize relations with Russia. "How can we ever beat the Russian-German economic alliance? It's worth $36 billion a year," says Dmitry Vydrin, a political analyst in Kiev. As for private business, the doors to investors may be open, but it's not Westerners who have come in but Russians. "They are by far the largest group of non-Ukrainian businessmen," says Vladimir Zubanov, a pro-Yanukovych deputy. And with those Russian businessmen, of course, comes political influence.

[/size] [size="4"]In the long run, the Kremlin's use of its energy weapon could backfire. Russia employed the same tactics in the 1990s with the Baltics. "Cutting off supplies and forcing us to pay market prices was the best thing that could have happened to us," recalls Toomas Ilves, a former Estonian foreign minister. "It forced reforms and made us more competitive," not to mention more independent. But those were the days when Europe was strong and expanding, and Russia was weak. Today those roles aren't quite reversed, but they are clearly very different. And Moscow is ready to take advantage.
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[andrewfi]

Don't these people know anything?

[ronin308]

Andrew what do you mean by those people?

[andrewfi]

the writers of that rubbish

[ronin308]

Man I feel like a dentist, why do you define the article as rubbish and why don't they know anything?

[coco]

Andrew is right,like most of the time:dude:

[andrewfi]

Ronin, I answered your question early and succinctly.

To go through the item line by line would take longer than I have available, suffice it to say that on almost all points the writers either grabbed the wrong end of the stick, imputed unlikely motivations or just got it wrong.

If you are not sure, having read the item, where the writers cocked it up, then you mght want to read a few newspapers, preferably not American, perhaps subscribe to JRL (Johnson's Russia List) and analyse what you read there. This will not give an instant answer, but it will lead you to a background understanding that these people do not have. I do not know whether the piece is a simple propaganda, thought influencing peice or was written without knowledge or insight as a cut and paste from other similar sources.

One of the most apparent shortcomings in the article is any semblance of the understanding of context. Assuming these are professional writers, this might lead me to believe that propaganda rather than lack of understanding is the bedrock upon which this was written. Professional analysts/journalists should understand context, indeed presenting context to a less well grounded audience is a key job for both journalists and analyts and thus they would not likely write such a thing, unless, the point was to remove context, allowing them to draw unsound conclusions and present them to an unknowing audience in order to confirm that audience's previously held prejudices and fears, or to create those very fears ab initio.

Just to take a single and easily understood point. Russia sells gas, they have a client who steals from them. The seller chooses to move to a system that will make it harder for the thieves to steal and says that unless gas is paid for then gas will not be supplied. This is not an act of war. The WTO, US and Europe are telling Russia that they must stop subsidising gas sales to their own people and industry, in the name of free trade. At the same time, the US, in particular, is criticising Russia for reducing its subsidies to Ukraine as Ukraine is unable to compete. Hmmm...? Russians nowadays pay more for Russian gas than Ukrainians do for the same gas.

The rest, well read for yourself, but you might want to start by learning about Yushchenko, and Timoshenko, their relationships, power bases and attitudes, oh and perhaps both people's relationship to the Ukrainian gas monopoly.

[BC]

.. without taking sides it seems quite like those that write about qualities of RW and have never met one..

I wonder what qualifications the authors of this article have.

Most interesting for me was the statement:

[size="4"]Buoyed by high oil prices, a booming economy and a hefty 7 percent budget surplus, Moscow can afford to throw its weight around in a way it's been unable to do in a generation.

[size="2"]yes.. an enviable position I would think.

I do hope that the situation in RU continues to improve and that the fruits of economic progress slowly but surely filters down to the common folk.
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[dostogirl]

..

I do hope that the situation in RU continues to improve and that the fruits of economic progress slowly but surely filters down to the common folk.
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They will run out of oil pretty soon and if they don't switch on gas (which needs a lot of investments) it's gonna be real bad for Russia. Russia needs to spend more money on improvements of industries other than oil and gas. Hope they realize it...

[RacerX]

TP ~ Good article - in that it stimulates discourse regardless of whether we necessarily agree with the authors. 

Owen Matthews  and Stefan Theil have a seen a lot more of the world than anyone on this board probably ever will.

[jb]

I think it's worth noting that America, (the most highly industrialized and thus the highest comsumer) took 125 years to consume it's first trillion barrels of oil.

That's the good news,,, the bad news is it will take only 30 years to consume the next trillion barrels.

And it's not just an American problem, the entire world needs to learn how to do with less petroleum, it is a finite resource, someday ssoon we WILL pump the last barrel.

[ConnerVT]

 the entire world needs to learn how to do with less petroleum, it is a finite resource, someday ssoon we WILL pump the last barrel.

 

This remark comes from an oilman and a political conservative.  I would take it to the bank that it's more true than anyone is willing to guess... 

[andrewfi]

On that thought, If the US learned to use energy on the same scale as we do in Europe, oil will last a lot longer. But as someone brighter than me wrote a few years ago, we will never pump out all the oil. There are only two possible scenarios. The first is that we will remove our need for oil, in quantity, through technological progression, or we will remove our need for oil, in quantity, by technological regression. There is no middle path.

[RacerX]

However, there are two competing theories concerning the origins of petroleum. One theory claims that oil is an organic 'fossil fuel' deposited in finite quantities near the planet's surface. The other theory, abiotic petroleum production, claims that oil is continuously generated by natural processes in the Earth's magma.  The later theory is widespread amongst Russian oil engineers and some claim is the reason they have been so successful in locating vast oil fields.  

If one subscribes to the abiotic theory, then the world's supply of oil will be adequate for many more generations.

[jb]

If one subscribes to the abiotic theory, then the world's supply of oil will be adequate for many more generations.

RacerX,

I suppose anything is possible.  But then too, I used to believe in the Tooth Fairy and Santa Claus.  

[andrewfi]

This is going well off topic, but...

If oil were to be formed geologically and not organically it would not make much difference to our current situation. Unless the world is floating upon a sea of oil (demonstrably untrue) then there is a practical limit upon the amount of oil available. Given that the abiotic production of oil is a geological process and takes millions upon millions of years, we can still, in practical terms run out of the stuff, simply because we use at a greater rate than the stuff is produced.

In practical terms, we will run out of oil long, long before the last barrel is removed from the ground. All that is needed for an effective 'running out' is for there to be a gap between production and demand. When that happens, we have, to all intents and purposes run out, because there wil be people whose needs will not be met and their reaction will be the same as if there was no oil at all. Did you ever see people fighting over food in a famine stricken region? Many people get nothing, most do not get enough and a few get enough, or surplus. The effect of not enough is the same as none at all, it just takes longer to die.

 

 

[catzenmouse]

RacerX,

I suppose anything is possible.  But then too, I used to believe in the Tooth Fairy and Santa Claus.

PLEASE NOT SANTA.... Say it ain't so!!! Say it ain't so....

[RacerX]

To some extent you are missing the point - the continuous production means that fields, such as those in TX/OK etc. that were tapped-out years ago may in a few decades or so be capable of providing limited production. As the theory goes, the actual oil is entrapped deep within the Earth and then works its way up to the surface.  It becomes a renewable resource akin to trees growing to sufficient size to produce usable wood.  We may yet outstrip the natural production process, but many feel that a true crisis is decades away, or best case scenario, only the product of alarmists.

[Bruno]

If one subscribes to the abiotic theory, then the world's supply of oil will be adequate for many more generations.

RacerX,

I suppose anything is possible.  But then too, I used to believe in the Tooth Fairy and Santa Claus.  
[/quote]
Like JB, i have feel some doubt about oil from the abiotic theory... it was unknow to me...

But ...:

http://en.wikipedia.org/wiki/Petroleum#Origin

http://en.wikipedia.org/wiki/Abiotic_petroleum_origin

[Bruno]

The proponents of abiogenic petroleum claim that reserves are never exhausted because they are filled from below. This idea was verified in 1999, when an oil basin named "Eugene Island 330" off the coast of Lousiana went from being a relatively depleted reserve to suddenly refilling with pure oil, causing production to quickly raise back up to levels competing with when drilling began.

http://beyond-the-illusion.com/files/New-Files/990430/oilAndEvolution.txt

"Date: Fri, 16 Apr 1999 21:03:39 -0700 Here is an article from Today's Wall Street Journal page 1"

 

[TigerPaws]

[color="blue"][size="4"] [/size][/color] [color="#0000ff"][size="4"]The article came form the most recent issue of Newsweek, as for the meaning,  there is little question Russia is feeling flush with Petrodollars and the  power they believe they have because of it. This is a very short sighted view  which will come back and bite Russian in her collective ass because the people in  charge are squandering this resource by taking the short term profits and  spending them on super yachts not infrastructure. [/size][/color] [color="#0000ff"][size="4"] [/size][/color]

[color="#0000ff"][size="4"] There is little question that Russia  has vast untapped oil and gas resources, some have predicted enough to last 150  years or more at current production levels but the point is there is little if  any investment into new or the replacing of existing infrastructure. Russia is  falling apart, sure there are new buildings being built and old ones being torn  down, but there is no new roads, power plants, water and sewage treatment let  alone the infrastructure for them being built. [/size][/color]   [color="#0000ff"][size="4"]

 Russian agriculture is all but  gone, young people are leaving the farms and the old are dieing off,  rural Russia is becoming less and less attractive (like it was a nice place to  begin with ). Russia has to import almost all of her food, clothing and  manufactured goods, the prices for such items in the large cities is staggering  and the villages simply do not have them nor could they afford  them.[/size][/color] 

 [color="#0000ff"][size="4"] If Russia pushes too hard she may  find that her oil and gas profits will be going to pay for food, clothing and  spare parts to keep her crumbling infrastructure working, Europe and the U.S.  could turn up the heat on the goods Russia now has to buy making those Petrodollars a lot less valuable and find herself in a very weak position  globally.[/size][/color]
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[RacerX]

Bruno ~ thanks for that second article.

'My' calculations took into account that the Chinese, as they taste the fruits of a burgeoning economy will become energy gluttons, and I assumed that our EU friends, not to be outdone by the rest of the world (China, India, etc) will understand that others gain is their loss. In addition, I tend to be an abiotic conservative - thinking that the refill of the oil pool might take awhile.

However, my prediction by 2010 is that most Europeans will be driving Ford Excursions, or the equivalent. 

Your new vehicle:

[jb]

Oil pool?  Will you kindly explain "oil pool"?

[ConnerVT]

Oil Pool (n):  Typically found in a driveway beneath a Ford Excursion.

[RacerX]

[user=118]jb[/user] wrote: Oil pool?  Will you kindly explain "oil pool"?[/i]

For example (taken from the Alaska Oil and Gas Commission):

[size="3"]Oil Pool is defined as the accumulation of hydrocarbons common to and correlating with the interval between the measured depths of 9,500 feet and 11,500 feet,,,[/size]