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Over Easy: Putin, Poroshenko and Merkel Meeting in Minsk

4:45 am in Uncategorized by yellowsnapdragon

Minsk House of Government with a statue of Lenin in front

World leaders meet in Minsk to try to create Ukrainian peace.

Ukraine disintegrated into civil war partly over disagreement about whether to join the European Union’s economic integration program, the Eastern Partnership, or to join Eurasia’s new Customs Union (CU). Today, Belarus, Kazakhstan, and Russia will hold CU talks in Minsk, and Ukraine’s President Poroshenko is expected to attend. The CU meeting will be the first formal meeting between Vladimir Putin and Petro Poroshenko since the Ukrainian civil war began. Representatives of the EU will be included in the summit.

Although no agenda for the Minsk summit has been set, talks are expected to include diplomatic efforts to resolve the Ukrainian conflict. Poroshenko has indicated that he plans to ask that rebels be withdrawn from eastern Ukraine, while Putin will likely demand greater autonomy for the restive eastern provinces and protection of human rights there. The EU may pressure Poroshenko to make some kind of speedy resolution of the crisis before economic catastrophe spreads to Europe.

Angela Merkel, who traveled to Ukraine over the weekend, lacks confidence that the Minsk summit will yield meaningful results.

My talks in Kiev were aimed in part at preparing this meeting, which surely won’t produce the one big breakthrough in Minsk — just to curb expectations,

However, she has also just indicated that the EU is now willing to accept a decision by Ukraine to join Putin’s Customs Union if Ukraine chooses to do so. That’s an important shift. Meanwhile, Poroshenko dissolved parliament and called early elections for late October.

Off topic is welcome at Over Easy and everyone is invited to join the cat. Don’t be shy. See you in the comments.

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Over Easy: Putin Pivots to China

4:45 am in Uncategorized by yellowsnapdragon

A night view of Shanghai's HSBC government building

Putin is in Shanghai to finalize a major gas deal.

Today, Vladimir Putin travels to Shanghai to finalize a huge gas deal with China. The agreement, ten years in the making, guarantees the sale of 38 billion cubic meters of natural gas per year to China for the next 30 years.

Russia most likely will sell the gas at $350-380 per 1,000 cubic meters, a slight discount from the price Gazprom quoted last January.

‘Of course Russia wants to sell gas and resources at the highest possible prices. But because of the sanctions from European partners, we need to find a partner that can buy our gas long-term, which is why at the moment China looks very attractive to us,’ Aleksandr Prosviryakov, a partner at Lakeshore International, a Moscow-based asset management firm, told RT at a Confederation of Asia Pacific Chambers of Commerce and Industry (CACCI) in Moscow ahead of the big meeting on Tuesday.

A 2009 gas deal between Russia and China to supply 30 billion cubic meters of gas to China’s Xinjiang province was never implemented when construction on a pipeline was halted to shift resources to completing the Power of Siberia Pipeline instead. That pipeline will supply gas to China’s populous northern region with natural gas from the deal to be signed in Shanghai. Should both piplines be completed, Russia will be shipping 68 billion cubic meters of gas to China per year.

Perhaps more concerning to Washington is an April 24 meeting of Russian government officials to discuss “De-Dollarization” of Russia’s export operations. Recently, Russia flirted with the idea of doing more business in Yuan. A massive new gas deal done in rubles or yuan rather than dollars could massively impact the global financial status quo.

While Europe is furiously scrambling to find alternative sources of energy should Gazprom pull the plug on natgas exports to Germany and Europe (the imminent surge in Ukraine gas prices by 40% is probably the best indication of what the outcome would be), Russia is preparing the announcement of the ‘Holy Grail’ energy deal with none other than China, a move which would send geopolitical shockwaves around the world and bind the two nations in a commodity-backed axis. One which, as some especially on these pages, have suggested would lay the groundwork for a new joint, commodity-backed reserve currency that bypasses the dollar, something which Russia implied moments ago when its finance minister Siluanov said that Russia may refrain from foreign borrowing this year. Translated: bypass western purchases of Russian debt, funded by Chinese purchases of US Treasurys, and go straight to the source.

Aleksandr Prosviryakov:

‘This deal with Gazprom and cooperation with Russia shows that China is expanding, becoming bigger and bigger, and that this part of the world is dominated by China, India, and Russia, the US role is shrinking,’ said Aleksandr Prosviryakov.

This is exactly what the US has been trying to prevent. Yet, it appears that the US plan to contain Russia by expanding NATO into Ukraine and by imposing sanctions may have backfired. Instead of isolating Russia, the US has provided one more reason for Putin to look east to China. If Brazil, India and South Africa — the remaining members of BRICS — join up for De Dollarization, the future of American Empire will be different than what the neocons expect.

As always, Off Topic is welcome and lurkers are encouraged to join the chat. See you in the comments.

Update: Pepe Escobar writes about the Russia/China gas deal and the challenge to the dollar.

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Over Easy: Geneva II Sochi

4:45 am in Uncategorized by yellowsnapdragon

What does the Geneva II peace conference on Syria have in common with the Sochi Olympics? Why, that lovable rascal Bandar Bin Sultan Bin Abdulaziz Al Saud, of course.

Bandar Bin Sultan

The ongoing adventures of Bandar Bush.

Tomorrow, representatives of the Assad government sit down with Syria stakeholders to work out a plan for an interim government to end Syria’s three year old civil war. Russia and the US will have a seat at the table, but the most important actors beyond the Assad regime may not participate.

Here’s the thing: prior to last fall, elements of the jihadi rebels were funded, trained, and armed by cooperating agencies of the US and Saudi intelligence, historic allies and partners in crime. Apparently unbeknownst to Prince Bandar, the US was all the while in secret negotiations with Saudi Arabia’s regional arch nemesis Iran, whose vast, nearly untapped resource wealth and powerful Shia leadership threaten Saudi Arabia’s regional power.

The US double cross provoked Bandar on a parade of threats and bribes to salvage the Saudi’s plan for Syria. Volgograd was bombed in retribution for Russia staunch backing of Assad, and newly released video indicates that more attacks are planned at Sochi. Attacks will involve weapons “up to and including chemical ones.” Note that chemical weapons were also used against civilians in Syria by Bandar’s mercenaries.

After vicious, bloody infighting among the armed rebels in Syria that just happened to begin in earnest after secret US/Iran talks were revealed, opposition forces seem to be moving toward reunification. The political wing of the opposition that loosely represents the myriad competing rebel factions, Syrian National Council (SNC), voted to attend Geneva II.

Considering Bandar’s anger, you may ask what persuaded his jihadis to join Peace talks. Before the SNC voted on whether to attend, US Ambassador to Syria Robert Ford met with contingents from Bandar’s proxy army.

During the meeting, Ford told the SNC figures that Saudi prince Bandar Bin Sultan is on long vacation in the United States, “because of sickness and psychological fatigue,” Hamade added, citing the Syrian opposition official who is also close to former Prime Minister, Riyad Hijab.

“We would like to inform you that there are some changes that will take place in Saudi Arabia next March,” Ford said, noting that these changes will reach Bandar Bin Sultan and Saud al-Faissal.

If Bandar is, in fact, in the United States for an extended stay, new questions arise. What exactly is the new relationship between the US and Saudi Arabia? Who in the Kingdom is in charge of Syria policy today and what will change in March? Why would Bandar come to the States for a long visit while relations with the US Government are so strained over the US’s policy turnaround in Syria? Is Bandar’s stay deliberately intended to coincide with the games in Sochi?

Regardless, the changes coming to the Kingdom’s hierarchy appear aimed at affecting Saudi policy in the Shia Crescent. The changes noted by Ford are specifically directed toward Bandar himself.

The US ambassador added that the Saudi committee for Lebanon and Syria (which compromises Abdulaziz Khoja, Abdulaziz Bin Abdullah Al Saud and Muqren Bin Abdullah Al Saud) is to be activated and will take over the Lebanese and Syrian file from Bandar.

Saturday, Iran was invited to participate in Geneva II. Yesterday, the invitation was revoked when the SNC objected. The results of Geneva II, if any, are in question as long as Iran is excluded.

At any rate, it is clear that shifting alliances in the region are bound to bring more surprises.

As always, Off Topic is welcome and lurkers are encouraged to join the chat. See you in the comments around 6 a.m. PST.

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