Three Conditions
- “We really are finishing the demilitarisation of Ukraine. We will finish it. But the main thing is that Ukraine ceases its military action. They should stop their military action and then no one will shoot.”
- “They should make amendments to the constitution according to which Ukraine would reject any aims to enter any bloc. This is possible only by making changes to the constitution.”
- “They should recognize that Crimea is Russian territory and that they need to recognize that Donetsk and Lugansk are independent states. And that’s it. It will stop in a moment,”
The above conditions were set by Kremlin spokesman Dmitry Peskov according to Reuters.
Oil futures have been falling and as of about 7:00 AM central have given up about half their gains, still up about 5% as I type, down from a 10% spike when the market opened.
US bond yields had been flat, now they are up across the board with the 10-year note up 6 basis points, the 5-year note up about 5 basis points, and the 3-month yield up 4 basis points.
Gold which had spiked to $2007 is now at $1987 but that’s still up about $22.
It’s difficult to say if futures moves are related to the Kremlin announcement or simply normal retracement.
Regardless, this is an out of the blue move by Putin who likely realizes he is in serious trouble with Ukrainian resistance and protests on the home front.
Addendum
Here is the likely oil retrace explanation
My 1:00 AM Tweet
Note For the Week
This post originated at MishTalk.Com
Please Subscribe!
Like these reports? I hope so, and if you do, please Subscribe to MishTalk Email Alerts.
Subscribers get an email alert of each post as they happen. Read the ones you like and you can unsubscribe at any time.
If you have subscribed and do not get email alerts, please check your spam folder.
Mish
Doesn’t seem like Ukraine is ready to surrender.
———
Countries Flood Ukraine With Military Support After Zelensky’s Appeal
Updated: March 6, 2022
https://www.theepochtimes.com/here-are-the-countries-flooding-ukraine-with-military-support_4317496.html
Foreign Fighters Arrive in Ukraine to Repel Russian Invasion
Mar 4, 2022
At least 16,000 foreign nationals have volunteered to join an “international legion” created to resist Russia’s invasion of Ukraine, President Volodymyr Zelensky claimed, after Kiev lifted visa requirements for anyone willing to fight.
https://libertarianinstitute.org/news-roundup/foreign-fighters-arrive-in-ukraine-to-repel-russian-invasion/
“If Russia succeeds in Ukraine, if they accomplish their maximal objectives, then that’s a major dent in that order.
For a long time, if a state was going to do something
like this to a country, it had to come up with reasons that resonate
with the rest of international society. There’s really good research on
this by political scientists and historians showing how, even in the
previous political age, most countries, when they went to war, they
tried to find a reason that would somehow legitimate it in the eyes of
other interlocutors. Sometimes they even put off military operations and
waited for a time when it would look like they were really defending
themselves.
Russia has just blown this away completely. They’re
trying to get the world to believe that Ukraine, having sat there for
eight years, witnessing these breakaway republics, suddenly chose to
invade them and commit genocide against ethnic Russians, and that they
waited to do this until there were 170,000 Russian troops around their
country. You have to be a complete idiot to believe that.
So if they succeed here, if this use of force without any
justification is allowed to stand, then yes, the global order we’ve
lived under for 30 years will have taken a massive hit.”
Will Ukraine be able to plant their crops this year? If not, well, let’s just not think about it.
They account for nearly 20% of world wheat exports. If that goes missing, well, you can imagine the consequences.
Putin is completely untrustworthy. Anything he or his representatives say are all part of his ongoing plan. They’re stalling tactics, relying on everyone’s desperation for peace so he can regroup before commencing the next stage of his project, wherever that is.
Call it a “buyers strike” or “self-sanctioning,” but Russian crude is being shunned in the physical market even as a scramble for barrels sends oil futures to their highest levels in years.
“The current central bank sanctions and selective SWIFT action is causing major risk aversion by key market participants,” said Helima Croft, head of global commodity strategy at RBC Capital Markets, in a Thursday note.
The U.S. and its allies have imposed tough sanctions on major Russian banks, blocking them from the crucial SWIFT interbank messaging service, and have also targeted the nation’s central bank. The efforts are aimed at effectively ejecting Russia from the global financial system in response to Vladimir Putin’s decision to invade Ukraine.
However, they have so far included carve-outs for Russia’s energy exports amid worries over surging inflation.
Nevertheless, energy companies, trading houses, shipping companies, and banks have all backed away from the Russian energy business, Croft noted, adding that the country’s “already staggering” export losses could hit 3 million to 4 million barrels a day if Western powers follow through and impose the sort of energy-focused “secondary sanctions” that were aimed at Iran.
News reports have noted the struggle to clear Russian crude in the physical market. https://www.bloomberg.com/news/articles/2022-03-03/oil-trader-trafigura-offers-russia-urals-at-new-record-discount Thursday that commodity-trading giant Trafigura Group offered to sell a cargo of Russia’s flagship Urals crude at a record discount of $22.70 to Dated Brent, a global benchmark for physical oil transactions, but received no bids.
Oil futures ended lower Thursday after the U.S. benchmark https://www.marketwatch.com/investing/future/CL.1?mod=MW_story_quote hit a nearly 14-year intraday high of $116.57 a barrel in early trade. Brent crude https://www.marketwatch.com/investing/future/BRN00?countryCode=UK&mod=MW_story_quote also finished lower after hitting a session high at $119.84 a barrel, its highest since 2014.
Meanwhile, a growing premium for nearby oil futures contracts over later months — a phenomenon known as backwardation in commodities trading lingo — underlines how worried traders are about the ability to secure crude in the near term.
The premium for May Brent over the contract for delivery nine months later temporarily topped $20 a barrel, a level not seen since the 1990s, noted Edoardo Campanella, an economist at UniCredit Bank in Milan.
That geopolitical risk premium takes into account not only the risk of damage to oil facilities due to military action or potential Western sanctions, but also reflects soaring insurance costs to ship Russian oil. He observed that freight rates for oil coming out of both the Black Sea and Baltic sea more than tripling over the space of a few days as crude-oil buyers struggled to find shippers willing to send vessels into Russian ports (see chart below).
“This is part of a broader phenomenon of ‘self-sanctioning,’” he wrote. “Market participants are simply refusing to deal in Russian oil, even if Western governments allow it within the sanctions they have imposed on Russia in response to its invasion of Ukraine.”
The possibility of energy-specific sanctions, meanwhile, can’t be ruled out as the war rages on, said RBC’s Croft.
“Such punitive measures would curtail buying by India and China, with their refiners being forced to choose between accessing U.S. capital markets and doing business with Russia,” she said. “Though concerns about inflation are running extremely high in Washington, we believe the energy carve-outs could soon prove untenable as the Russian conduct of the war grows more gruesome and the civilian toll climbs.”
The Kenyan ambassador to the UN explains that problem very well.
Kooks are always bleating about sheep, and for some weird reason, covered in wool.
The war could end today but the repercussions of what just happened will
last 20+ years.
Russia-West relations will take forever to heal, regardless of the need for
Russian oil or commodities. Sanctions will likely remain for a very long time.
Any countries holding large reserves of foreign currency now know they are in
effect worthless and cannot be relied upon when needed. Defence budgets will
grow, requiring additional deficit spending during already record breaking
deficits. Just as the world split between pro and anti Covid
vaccination, and pro and anti-mask wearing, we are now faced with a pro (or at
least tolerant of) Russia and anti-Russia split in countries.
Anything less than a full acceptance of Russian conditions by Ukraine will
be seen as a loss by Russia, as their sunk costs are now enormous. The
reputation of the Russian armed forces is in tatters, which may impact Russia’s
ability to export weapons. Putin is now an international pariah; will this
result in an internal revolution and all the implications of that?
is disgraceful, a Russia that loses this war is far more dangerous than a
Russia which ‘wins’ (in the sense that such a war can never be really ever
won). I sincerely hope this war ends quickly with the least amount of
bloodshed, but I don’t see it happening anytime
I’ve seen you write dozens of dumb things, but you’ve outdone yourself today! You win Kook of the Month!
It’s also the most strategic.
Furthermore, Ukraine has become a very patriotic country, and nearly all of the citizenry there love the country. It’s a plain myth that those regions wanted to succeed anymore than SOCAL wants to create it’s own country or join with Mexico.
The claims being made are nonsense.
His offer is to partition Ukraine taking the most valuable parts for himself. It’s absolutely insane.
I’m quite confident that the bomb would be a red line that other nations would never tolerate. How that would play out I do not know, since if we bomb Russia they bomb us, but the bomb red line would be horrible for humanity.
Let’s hope Putin is not that crazy, but I have my doubts.
Nukes aren’t the worst thing that could happen. When the US bombed Tokyo during WWII we killed far far more people than the two bombs ever did, yet no one knows about it. Nuclear bombs are literally HOT topics for the media.
And then there is the radiation….
“About 3,000 workers at Canadian Pacific Railway Ltd. voted in favour of going on strike March 16 if a collective bargaining agreement isn’t reached, according to their union. That would impact Nutrien’s ability to move potash, nitrogen and other crop chemicals to retail locations across Canada just ahead of spring planting, the company said in an email.
Without such products, harvests could be reduced when food prices are soaring. The fertilizer supply chain is still “reeling” from impacts of everything from COVID-19 to sanctions on Belarus and Russia’s invasion of Ukraine, Nutrien said. Crop nutrient prices are at all-time highs amid concerns about shortfalls.
“The global food supply is already stretched and cannot afford further negative impacts at this time,” the company said Wednesday in a statement. “We would be very disappointed to see a labor dispute have such a significant impact on global agricultural supply chains, and consequently, we would hope that the Canadian government will consider intervening to avert another transportation crisis.”