{"id":18139,"date":"2024-04-25T20:20:22","date_gmt":"2024-04-25T17:20:22","guid":{"rendered":"https:\/\/www.liberalglobe.com\/?p=18139"},"modified":"2024-04-25T20:20:22","modified_gmt":"2024-04-25T17:20:22","slug":"russian-lng-russias-weak-point","status":"publish","type":"post","link":"https:\/\/www.liberalglobe.com\/?p=18139","title":{"rendered":"Russian LNG &#8211; Russia&#8217;s weak point"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The war in Ukraine is progressing normally. The front is slowly but surely creeping further and further west of long-suffering Donetsk.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">At the same time, much to the delight of the Kiev regime, Washington recently voted to make available a new military aid package of $61 billion. However, as it became clear almost immediately, not all of it will go to Ukraine &#8211; caveats abound.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In light of what is happening, Tobias Billstr\u00f6m&#8217;s speech is of particular interest. The head of the Swedish Foreign Ministry, commenting on the European vision for Ukraine, said that the European Union is determined to continue helping Kiev and is therefore considering the possibility of banning the import of Russian liquefied gas in the next, 14th package of sanctions &#8211; something which it is really interesting as well as important.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In this case we must begin our reports with the fact that the collective West either has not found new levers of influence on unpopular geopolitical competitors or continues to be captured by delusions that in the modern world it is possible to strangle a more or less large state with a rope sanctions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Sanctions have not worked on small, poor and utterly resource and energy poor North Korea, as it continues to develop and grow its military. Of course, there is nothing to say about Iran: the whole world can see its successes in the field of military industry in recent years.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">All previous attempts to collapse the Russian economy have failed. The construction of houses and infrastructure continues, roads are built and so on. The ruble is strong, while unemployment is at an all-time low. And all this while there have been 13 sanctions packages.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The embargo on the import of Russian LNG has not hit the Russian economy \u2013 although there are some unpleasant consequences. In any case, we need to understand the key numbers, the stakes and the trends.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The global LNG market is one of the fastest growing, which is due to constant demand, the ability to increase and decrease prices, geographical maneuvers that can be made and, therefore, high profit margins. Russia in this market ranks fourth with a share of 8%, behind the United States, which has made a colossal leap over the past year, as well as Australia and Qatar.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The production lines of the latter are operating without reserves in the interest of the markets of the Asia-Pacific region. Qatar still supplies Europe with LNG, but flatly refuses to increase these quantities, no matter how much Brussels begs. It is noted that the liquefied gas industry is relatively new for Russia &#8211; only four plants are currently operating.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The largest of these are Yamal LNG, the Sakhalin-2 offshore platform in the Far East and smaller enterprises. Specifically Cryogas-Vysotsk in the Baltic and the Portovaya LNG station located in Ust-Luga. Arctic LNG 2 is under construction, but following actions by Washington the operation of the second and third production lines is probably at a standstill, mainly due to the mass refusal of suppliers and contractors.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">One of the biggest difficulties was the lack of polar carriers, which were built in South Korea, which the United States prohibited from selling to Russia or third parties. The available capacities allowed Russia to produce and export the following product volumes:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>2020 &#8211; 30.7 \/ 29.6 billion cubic meters.<\/li>\n\n\n\n<li>2021 &#8211; 30.5 \/ 29.6 billion cubic meters.<\/li>\n\n\n\n<li>2022 &#8211; 33.5 \/ 32.9 billion with the mandatory clause that the target was to reach the level of 49 billion cubic meters of production, these same sanctions worked.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Based on the results of 2023, Russia is the second largest natural gas supplier to the European Union. If an import ban is nevertheless introduced, there will be difficulties for the Baltic factories and the Yamal line for the simple reason that they were originally built for the European market.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">At the same time, keeping in mind the procedures that accompanied previous bans on the import of Russian natural gas, a redirection of flows to the east, along the North Sea, is envisaged. Of course, this process will not be instantaneous. In addition, the turnaround is hindered by the reported lack of ice-class tankers, which will lead to losses.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For now let&#8217;s mention that in the last two years, the consumption of natural gas in Europe has decreased exactly by the volume of Russian imports, i.e. by 120 billion cubic meters. That is, it was not possible to find other suppliers &#8211; and Brussels put a knife to its own industry.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Meanwhile, European energy workers, amid promises to ban imports, know that the Old World expects Russian LNG to go to Asia, pushing a similar volume back into the European market. Of course, at a higher price, but this fact is usually hidden behind parentheses.<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full\"><img decoding=\"async\" src=\"https:\/\/www.liberalglobe.com\/wp-content\/uploads\/2024\/04\/image-88.png\" alt=\"\" class=\"wp-image-18142\"\/><\/figure>\n<\/div>\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Financial capital<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We don&#8217;t particularly care how much the European Union will pay for Australian or Qatari LNG in the coming years &#8211; let&#8217;s talk about Russian financial capital. In the first three quarters of 2023, Russian manufacturers lost an average of 41% of their profits.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Considering that Gazprom alone contributes more than three trillion rubles in federal and local taxes to the budget annually, one can roughly imagine the tax arrears.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">NOVATEK, the main shareholder of the largest LNG projects, published tax data for the fiscal year 2023. The company (excluding income tax) paid more than 145 billion rubles in mining tax, 7.2 billion in property tax and 517 million in other taxes.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Provided that the replacement of ice gas carriers is in full swing at the Zvezda plant, this year we can at least expect the start of the second production line at Arctic LNG 2, that is, tax revenues will certainly not collapse.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In summary, it must be said that in the current existential confrontation between Russia and the collective West one should not fall into mistakes. The sophisticated and vile blows they inflict on the Russian bear come at a price. However, the country&#8217;s security margin turned out to be many times greater than what was predicted by the multitude of Western economic and military advisers. Russia will survive &#8211; and this is no longer propaganda, but fact.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The war in Ukraine is progressing normally. The front is slowly but surely creeping further and further west of long-suffering Donetsk. At the same&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[821,818,390],"tags":[3690,58,70,184],"class_list":["post-18139","post","type-post","status-publish","format-standard","hentry","category-asia","category-europe","category-politics","tag-lng","tag-russia","tag-usa","tag-west"],"_links":{"self":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts\/18139","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18139"}],"version-history":[{"count":1,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts\/18139\/revisions"}],"predecessor-version":[{"id":18143,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts\/18139\/revisions\/18143"}],"wp:attachment":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18139"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18139"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18139"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}