Both Sides Now
Both the US and Russia are threatening to halt deliveries of Russian oil. Russia ups the ante with natural gas.
The price of US crude jumped jumped to $130, gold rose $80 by 4% to a new record, and stocks are in the gutter again as Biden announces a ban on Russian oil
US Ban
President Biden will announce later today a Ban on Imports of Russian Oil.
The U.S. ban will include Russian oil, liquefied natural gas and coal.
In addition, both Shell and British Petroleum announced they will withdraw from Russian oil and gas. They will immediately halt all spot purchases and end all dealings with Russia according to the Wall Street Journal.
UK Too
Russia Threatens to Halt Energy Exports
Yesterday, Bloomberg reported Russia Threatens to Cut Natural Gas Flows to Europe Via Nord Stream 1
Russia has the right to take actions that “mirror” the penalties imposed on the Russian economy, Deputy Prime Minister Alexander Novak — who’s also in charge of energy affairs — said in a televised speech late Monday. He said no decision to shut off Nord Stream 1 has yet been taken, and the pipeline is currently operating “at its full capacity.”
The comments come after a day of wild swings on European gas markets, with prices at one point surging by almost 80% amid fear of disruption to supplies from Russia.
Germany has pushed back against proposals for a ban on oil imports. German Chancellor Olaf Scholz said Monday that Russian oil and gas are of “essential importance” to the European economy. Roughly 40% of EU gas imports and one quarter of its oil come from Russia.
Russia warned that any such move could have “catastrophic consequences for the world market” with prices surging to $300 a barrel or more.
Brave Front by the EU
The EU claims it can “reduce our demand for Russian gas by 2/3 before the end of the year.
Really? And you didn’t do this before?
Not That Simple
Spare Capacity
What About Japan?
Green is Dead?
And the US still has sanctions on Iran and Venezuela!
Team Biden Headed to Venezuela
How stupid is this?
U.S. Officials Meet With Regime in Venezuela, to Discuss Oil Exports to Replace Russia’s
European Gas Prices
What happens if Putin shuts off the gas?
Massive Shortfall
Lyn Alden on Gold
Gold hit a new record high today.
Nasdaq Enters a Bear Market, Down Over 20%, Where To From Here?
Yesterday, I noted Nasdaq Enters a Bear Market, Down Over 20%, Where To From Here?
I expect a decline of 65% or so from the top, so this is just a down payment.
I repeat my February 23 comments Most People Have No Idea How Much Stocks are Likely to Crash
Recession Baked in the Cake
R E C E S S I O N
Macro Maven Steph Pomboy on Recession
A Recession Looms, Blame the Fed and Biden, Not Russia
A recession fueled by collapsing demand, a liquidity crunch, and fading stimulus effects is coming up. Inflation sure doesn’t help.
Steph Pomboy made those comments yesterday.
I said the same thing on March 3: A Recession Looms, Blame the Fed and Biden, Not Russia
Macro Dream Team Videocast Parts One and Two
Pomboy is part of a Dream Team of macro analysts. Please play the video. You can find it here: Macro Dream Team Videocast Parts One and Two
I concluded “Very few people see a recession coming. But the dream team does. Do yourself a favor and watch both parts. Hopefully they are more persuasive than I am.”
This post originated on MishTalk.Com.
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Mish
Germany was split in two with completely new governance. East Germany only prospered when Germany was eventually unified.
Ok, I can’t be sure, but I’d guess it’s better than when they were behind the Iron Curtain.
“Many people today would conclude that world leaders have done their best to ignore this advice. The likely problem with fossil fuels has been hidden behind an imaginative, but false, narrative that our biggest problem is climate change caused primarily by fossil fuel extraction that can be expected to extend until at least 2100, unless positive steps are made to hold back this extraction.
In this false narrative, all the world needs to do is to move to wind and solar for its energy needs. As I discussed in my most recent post, titled https://ourfiniteworld.com/2022/02/09/limits-to-green-energy-are-becoming-much-clearer/, this narrative of success is completely false. Instead, we seem to be hitting energy limits in the near term because of chronically low prices. Wind and solar are doing very little to help because they cannot be depended upon when needed. Furthermore, the quantity of wind and solar available is far too low to replace fossil fuels.
Few people in America and Europe realize that the world economy is entirely dependent upon Russia’s exports of oil, coal and natural gas. This dependency can be seen in many ways. For example, in 2020, 41% of world natural gas exports came from Russia. Natural gas is especially important for balancing electricity from wind and solar.
North America has historically played only a very small role in natural gas exports; it is questionable whether North America can ramp up its total natural gas production in the future, given the depletion problems being experienced with respect to the extraction of oil and the associated natural gas from shale formations. Continuously high oil prices are necessary to justify ramping up production outside of sweet spots.”
It takes a long time to replenish supplies, and Europe is almost empty. Without deliveries this summer being stockpiled, Europe is in big trouble.
If Putin shuts off the taps, gas prices will explode even more than they have.