Donald Trump Couldn’t Make Germany Quit Its Russian Energy Addiction, but Vladimir Putin May Have Succeeded – Opinion

Germany, one of Russia’s major European customers for oil, announced that it is weaning itself from its dysfunctional addiction to Russian oil.

German Foreign Minister Annalena Baerbock said, “We will halve oil by the summer and will be at 0 by the end of the year, and then gas will follow.”

Russian oil represents about 25% of Germany’s current usage and puts $285 million/day into the pockets of Putin and his inner circle.

Germany announced its intention to reduce Russian gas use to zero next winter. The difference will be covered by Norvegian natural gas, which is piped via Lithuania.

As is usual during this time of Putin’s War, Germany is following rather than leading.

Poland declared a month ago that it would ban all Russian imports of energy, including oil and gas. The Baltic States followed Poland’s lead within a week.

As this was unfolding, Germany’s Finance Minister Christian Lindner announced that Germany would refuse to abide by Putin’s demand that all bills for Russian energy exports be paid in rubles rather than in the currency specified in the contract. This was Putin’s blatant and juvenile attempt to force energy customers to breach sanctions and prop up the Russian ruble.

Christian Lindner, German Finance Minister, stated that companies buying Russian natural gas shouldn’t have to open ruble accounts in order to purchase it. This is contrary to a request made by Vladimir Putin last month.

“Contracts are contracts,” Lindner said Wednesday in an interview with Bloomberg Television in Washington. “Contracts are based on dollars and euros and so private-sector companies should pay in dollars or euros.”

While oil, as they say, is fungible, Russia’s near-term problem will be trying to find a customer for its oil and a way to move Russian oil to a non-European market. Germany will find it easier to buy oil from other markets, even though the price will be higher. However, Putin can’t make up the hundreds of millions of dollars that will no longer pass into the Swiss bank accounts of Russian kleptocrats each day.

This brings Germany’s previously solid-as-jello position on ruble payments into alignment with the rest of Western Europe.

This story has many subplots, just like any other big story.

This decision by Germany to announce it is ending Russian energy imports and refusing to bow to Putin’s demands is not without risk. Germany’s economy is teetering on the edge of recession; unlike ours, which has been buoyed by the wise and benevolent policies of Joey SoftServe, the Germans haven’t had the benefit of the BidenRecovery®. The Bundestag has a small majority of the German government coalition, which includes Social Democrats, Free Democrats and Greens. A little luck might bring down the government.

The most important subplot is political and involves the communist-followed-by-Russian suborning and coopting of the leading partner in the ruling coalition, the SPD.

Germany’s ruling Social Democrats are facing fresh pressure over their links to Moscow after accusations that a regional leader worked with Kremlin-backed energy giant Gazprom to undermine U.S. sanctions and spread Russian propaganda.

The allegations center on Manuela Schwesig, a senior member of Chancellor Olaf Scholz’s SPD party and the premier of the northeastern state of Mecklenburg-Vorpommern. This state was once the terminus of Nord Stream 2 Russia-to Germany natural gas pipeline Nord Stream 2. It had been long supported by Berlin, but it was cancelled as Russia became more aggressive in its invasion of Ukraine.

Schwesig has become increasingly unpopular since Welt newspaper obtained documents that showed Schwesig’s government had closely cooperated with Nord Stream 2 AG which is a Gazprom-owned subsidiary, to help it complete its project in face of American sanctions. Documents revealed that the foundation, which was supported by Gazprom and the local government, was used to bypass the U.S. sanctions.

The revelations are the latest blow to the reputation of the center-left governing party, which has already come under heavy fire for sticking with close ties to Russian energy interests in recent years, even after President Vladimir Putin’s government fomented a war in eastern Ukraine and annexed Crimea in 2014.

The motivation to attack Russia’s energy supply and the way to pay it for it may be more political survival than principle. Their actions, regardless of their motives, are welcome.

This is all amusing, as NeverTrumpers and Euros screamed at Trump for doing anything he could to end Russian energy projects. Of course, one of Biden’s top priorities after inauguration was undoing the roadblocks President Trump had thrown up to stop more Russian penetration of Europe’s energy market; this is, I’m sure, totally unrelated to any Russian Kommpromat.

Russia, as I mentioned yesterday is reacting to its declining importance in European affairs. Russia’s descent into becoming a puppet country of Communist China has seen it become more violent and irrational. The NATO-EU nations have agreed upon a strategy involving Russia’s political and economic isolation while beefing up NATO defenses to withstand another Ukraine-invasion-style adventure elsewhere (see US and NATO Plan Long-Term Political and Economic Isolation of Russia and a New Cold War). I believe that this strategy is necessary until Putin and his circle of friends leave the scene. Germany has taken this action in solidarity to Free Europe, but it is against its immediate interests.

 

 

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