On Russian Telegram today

Not enough food cards for everyone

Prices in Russian stores continue to grow and authorities in some regions are introducing food stamps. State Duma Committee Head on Financial Markets, Anatoly Aksakov proposed extending this to the entire country

1/4 The cards for cheap fish introduced in Kamchatka are only available to WWII veterans, home front workers, children of war, concentration camp prisoners and disabled combat veterans. Pensioners and large families cannot take advantage of this support measure

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Trending on Russian Telegram:

“The Russian economy will collapse in 2025” – analysts are frightened by a new chilling prophecy from The Economist magazine.

1/3 Many believe that it is owned by a transnational elite that controls the course of history. In 1983, they predicted the collapse of the USSR. In 2000, the fall of the Twin Towers. The same with the high-profile events of recent years: from the SVO to the launch of Oreshnik.

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It’s time to suspend Hungarian membership rights for serious and persistent breaches of the principles of the European Union.
In this video, we explain the European Union Article 7 process, specifically in relation to Hungary.

You can watch the YouTube presentation of this thread here 👇

youtu.be/HiMyVOOvnj8

Back in January 2024, The European Commission announced that it would will not push forward Article 7, the so-called nuclear option, against Hungary over breaches of fundamental rights until there is a strong majority in favour among member states.

Article 7 has in fact already been invoked against Hungary, back in 2018. Breaches of EU Principles were defined and agreed upon with Hungary, with specific remedies for these breaches agreed to - together with a grading of the breaches and timelines for the remedies were agreed with Hungary as a pathway to the resumption of EU funding.

The problem is that while Victor Orban and his regime has not only failed to remedy the breaches, he has in fact doubled down on some of the breaches in areas such as the judiciary and immigration rules, with a limited number of breaches being remedied and partly remedied. It is the European Commission that is responsible for progressing the Article 7 to the sanction phase, with clear grounds to do so as Hungary has failed to remedy a substantial number of breaches agreed with Orban and his right wing regime in 2018.

The Commission’s position is one of ambivalence and inaction, they claim there is insufficient member state support to progress the Article 7 sanctions which could or should result in Hungary being muted and denied a vote in EU affairs. In January 2024, after notifying Hungary of their failure to remedy breaches - the Commission put out this statement:

"It's not possible for the Commission to take a decision in the process," Didier Reynders, the European Commissioner for Justice As recognised by Transparency International, “the past decade has seen sustained attacks on the EU’s fundamental values by one of its own member states.

For the past 13 years, Hungary’s government has launched a barrage of laws aimed to erode its democracy, all while continuing to benefit from EU funds, as well as enriching its cronies through widespread corruption.

There is well-documented evidence that it has privileged granting public contracts to its supporters, diverted EU funds to its associates, subdued the country’s judicial system, undermined media freedom and pluralism, demonised non-governmental groups and criminalised some of their activities, eroded academic freedoms, violated the rights of women, refugees, asylum seekers, LGBTQI+ people and other minorities.

In a scathing resolution voted in January, the European Parliament demanded Article 7 shift to second gear and conclude the "existence of a serious and persistent breach" of fundamental rights inside Hungary. But this new step, which has never been activated, requires a written proposal by the European Commission or one-third of member states.

Attacks on the rule of law in Hungary are systemic and deeply rooted. Not only do they threaten to unravel decades of democratic progress, but they also pose a direct threat to the European Union’s democratic legitimacy and access to the European Single Market. The EU cannot claim to be democratic if one of its own member states persists in violating the democratic values upon which the EU was founded.

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Next 👉 The EU’s response The EU’s response to these developments has so far failed to deter Hungary from continuing to slide backwards into authoritarianism. Hungary has faced numerous Article 7(1) hearings in the Council of the EU and debates in the European Parliament, which have sought to establish that there is a risk of a “serious and persistent breach” of EU values in Hungary.

Yet no recommendation on this has been issued by the Council for five years and the process remains stuck. Hungary has also been the subject of multiple European Parliament resolutions and been harshly criticised by the European Commission in its various assessments and reports.

The repeated and systemic attacks of the Hungarian government on EU values have led to EU funds being frozen and to Hungary being subject to the EU’s rule of law conditionality mechanism.

In total, Hungary’s actions are under scrutiny by three separate instruments: the horizontal and thematic enabling conditions under the EU Charter of Fundamental Rights, which enables access to Cohesion Policy funding; 27 super milestones under the EU’s Recovery and Resilience Fund, which include measures such as combating corruption and rule of law reforms; and the rule of law conditionality mechanism, which imposes measures to protect the EU budget against breaches of the rule of law.

While Hungary may have undertaken some cosmetic reforms to unblock its EU funds, analysis by our partners in Hungary shows that these fail to address the remedial measures and reforms required.

In fact, the Commission’s own latest assessment is that “despite regular exchanges with Hungary, the Commission considers that Hungary has not addressed the breaches of the principles of the rule of law that led to the adoption of measures by the Council in December 2022 under the budget conditionality mechanism.”

The Commission also determined that Hungary had failed to fulfil the conditions it had proposed and committed to remedy. These breaches are related to public procurement, public interest trusts, prosecutorial action, conflicts of interest and the fight against corruption.

The Commission itself, then, has tacitly recognised that Hungary has undertaken multiple breaches of the principles of the rule of law, and failed to address these adequately. This goes beyond the risk of a “serious and persistent breach” of EU values, as stipulated by Article 7(1).

This is why Article 7(2) proceedings must be initiated. Article 7(2) would mark the first step to determining the existence of such a serious and persistent breach of EU values, as opposed to the mere risk outlined in Article 7(1). Upon confirming such a breach, which has been evident to the European Parliament since at least 2018 —when the Article 7(1) procedure against Hungary was launched—the Member States would be able to proceed to the second step under Article 7(3), potentially resulting in the suspension of specific membership rights to Hungary, including voting rights in the Council.

The last European Council meeting in December once again showcased Hungary’s obstructionist behaviour, including blackmailing the institutions and threatening to veto decisions on key policies. A strong response from Member States, as well as the EU Institutions, to these actions that deliberately undermine the Union’s functioning is now more critical than ever.”

Again in June 2024, EU M E P’s voted overwhelmingly on a resolution calling for Article 7 to be completed against Hungary.

There were the obvious detractors from this vote, primarily from Spain

From Italy and Germany

And other mostly right wing parties, who have sought to rally on russian narratives around the illegal and genocidal war being conducted by Russia in Ukraine.

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Next 👉 What is Article 7 you ask..

Cuba - a repeating lesson of what Communism offers to humanity. This story has relevancy both to the russian regime and Ukraine, read on to fond out how!

This is a lengthy thread - consider bookmarking the thread and listening to the audio narration at a convenient time for you. Ideal for commuting and bedtime listening! The link to the audio narration is found in the first reply to the last tweet in this thread.

Right let’s crack on!

You may have heard about the catastrophic power failures in Cuba over the past few weeks - this thread explains the context and background, and the inextricable Cuban links back to the Kremlin and the illegal war in Ukraine.

👉 Background:

The trade deal between Russia and Cuba, as part of the broader attempt by nations like Russia and China to build alternative power structures, poses significant implications for both regional and global geopolitics.

This partnership symbolizes Russia's effort to expand its influence into the Western Hemisphere, specifically just 90 miles from the United States, representing a strategic and symbolic challenge to U.S. dominance in the region.

This comes at a time when several Latin American countries, such as Venezuela, Mexico, and Brazil, are increasingly pursuing foreign policy agendas independent of U.S. influence, creating openings for powers like Russia to make inroads.

From a geopolitical perspective, Russia's deal with Cuba provides it with an economic and potentially political foothold close to U.S. territory, which could become a platform for further outreach to Latin America. Russia is likely hoping that by offering economic alternatives to countries suffering from U.S. sanctions or strained relations with the West, it can pull more nations into its sphere of influence.

Cuba, isolated by decades of U.S. sanctions, may view this deal as a lifeline to bypass U.S. economic restrictions and expand its trade options.

For Cuba, this alignment with Russia may come at significant cost. Economically, while Russia’s presence might bring short-term benefits, such as investments and access to Russian markets, it is unlikely to solve Cuba's deep-seated economic crisis.

The deal risks increasing inequalities on the island, especially as Russian officials and tourists gain privileged access to resources and property that ordinary Cubans cannot enjoy. This has the potential to stoke social discontent, which has already flared in recent years due to food shortages and power blackouts.

The 2021 protests in Cuba revealed the fragility of the regime and the growing frustration of the population with the government's inability to address economic hardship.

Furthermore, Cuba’s closer ties to Russia may complicate any future rapprochement with the United States and Europe. U.S. policy toward Cuba has oscillated between isolation and cautious engagement, with the Biden administration taking a more critical stance amid Cuba's political and economic crises.

The closer Cuba gets to Russia, the less likely the U.S. will be to consider lifting sanctions or easing restrictions, making it harder for Cuba to diversify its economic partners.

European nations, which might have considered deepening trade with Cuba under more favorable conditions, may also be deterred by Cuba’s alignment with Russia, given Europe’s own sanctions against Russia and its desire to limit Moscow’s global influence.

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Next 👉 Russian expansion into Cuba Russia’s expansion into Cuba, however, reflects a broader trend of authoritarian regimes consolidating power and forming alliances that shield them from Western pressure.

By reinforcing one another, these nations are less incentivized to adhere to democratic norms or respect human rights, exacerbating global tensions between democratic and authoritarian powers.

While Russia gains a strategic outpost in Cuba, the Cuban regime benefits from an economic lifeline that reduces the pressure for domestic reforms. This creates a cycle where both nations are insulated from external demands for political liberalization, further entrenching authoritarianism.

Despite the potential economic gains from this deal, Cuba remains at a disadvantage. Russia, already facing economic strains due to sanctions and the ongoing conflict in Ukraine, may not be able to fulfill its commitments or offer sustained support to Cuba.

This creates the risk that Cuba could be left without meaningful economic relief, while sacrificing potential improvements in relations with the West. The human cost for Cuba could be significant, as its population continues to suffer from a lack of basic necessities and an increasingly unequal society, while the government prioritizes foreign partnerships over domestic reforms.

In conclusion, while Russia's deal with Cuba strengthens both regimes in the short term, it also heightens geopolitical tensions and risks deepening social and economic inequalities within Cuba.

It challenges the U.S. and the West's ability to influence outcomes in the region and signals a broader trend of authoritarian powers working together to bypass Western sanctions and democratic pressures. The long-term stability of this relationship, however, remains uncertain, especially given the fragility of both Russia's and Cuba's economies.

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Next 👉 Cuba and Russia - the corrupt regime marriage:

BRICS foundations are laid in economic and cultural rift sands. A collection of flawed alliances?

This thread is lengthy - why dont you consider listen to the Audio narration as a podcast on your device, ideal for computing and bedtime story time 😎 The link to the narration is found in the First Reply, to the Final Tweet in this thread.

What is BRICS?

The acronym BRIC (Brazil, Russia, India, China) was coined in 2001 by Goldman Sachs economist Jim O’Neill to designate these four countries as attractive investment destinations, riding on a wave of enthusiasm about the prospects of emerging markets.

In 2006, the four countries’ foreign ministers met on the sidelines of the United Nations General Assembly in New York to formalize the group known as BRIC. In 2009, the first summit of leaders took place, followed by annual meetings ever since. In 2010, the group was expanded to include South Africa—becoming BRICS.

The BRICS group was organized around the goal of enhancing consultation and coordination between the five major developing countries to change the current Western-led world order into a multipolar system where developing countries have more influence, commensurate with their shares of the global economy.

Despite the five members’ divergent economic trajectories in the years since—with China and India having grown impressively while the other three saw weak growth—the BRICS group has made significant progress.

However, the original logic that O’Neil asserted would bring the BRICS together—a common experience in sustained economic growth—hasn’t held. Brazil, Russia, and South Africa have fallen short of growth expectations, and while India has enjoyed stronger performance, it hasn’t kept pace with China.

Instead, the BRICS alliance has slowly evolved into a largely geopolitical coalition that aims to advance an agenda and approach to world affairs that is distinct from the Western-dominated G7.

Nowhere is that distinctive approach more obvious than with respect to Russia’s war with Ukraine. None of the BRICS has supported sanctions on Russia. In fact, members including India and China have used Western-led boycotts of Russian energy to secure cheaper oil, gas, and other commodities for themselves.

Failed expectations, differing views on the region and more importantly - a reluctance to pick sides in the competition between China and the US – and to aggravate Russia – have sent them on diverging paths. That said, they are pursuing multi-alignment rather than seeking a break with the Western powers that remain central to their security and prosperity.

BRICS will not solve their fundamental security, or even economic, challenges. These Middle Eastern powers will bring both simmering rivalries and high expectations to the BRICS grouping, but also will not be keen to antagonise Russia, and above all China and India. This guarantees complex, and at times awkward, statecraft in coming years.

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Next 👉 BRICS makeup 👉 BRICS makeup:

Together, BRICS countries have 3.24 billion inhabitants—or 41 percent of the world population—and a combined gross domestic product (GDP) of $26 trillion, or 60 percent of the G7 countries’ combined GDP. However, on a purchasing power parity basis, BRICS countries’ GDP accounts for 31.5 percent of the global economy, overtaking the G7 share of 30.4 percent.

Despite this, BRICS countries get only 15 percent of the voting power at the International Monetary Fund—a source of developing countries’ discontent over the governance of international financial institutions.

Russia was the first to call a convening of the four countries, a decision analysts say was driven by Russian President Vladimir Putin’s growing desire to create a counterweight to the West. Russia hosted the first official BRIC summit in 2009, and South Africa joined a year later by invitation from China, forming the five-country grouping that would persist for more than a decade.

In August 2023, at the 15th BRICS Summit, South African President Cyril Ramaphosa announced that 6 emerging market group countries (Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates) had been invited to join the bloc. Full membership was scheduled to take effect on 1 January 2024.

However, the Argentine general election in November 2023 led to a change in president to Javier Milei, who had committed to withdraw the country's membership application. On 30 November 2023, incoming Foreign Minister of Argentina Diana Mondino confirmed that Argentina would not join the BRICS.

On 29 December 2023 the Government of Argentina sent a letter to all BRICS leaders to officially announce its withdrawal from the application process.

Saudi Arabia did not join BRICS at the start of 2024 as had been planned, and they announced in mid-January that they were still considering the matter. The matter is still under consideration.

👉 BRICS offering of an alternate financial system:

BRIC’s NRB and Contingent Reserve Arrangement (CRA) are meant to mimic the World Bank and International Monetary Fund (IMF), respectively. BRICS members hope that alternative lending institutions can invigorate South-South cooperation and reduce dependence on traditional funding sources.

The NDB and the CRA were designed as an alternative to the so-called Bretton Woods arrangement, the mainstream global financial system founded by leading industrial countries in the aftermath of World War II.

Many countries of the Global South believe those institutions, especially the World Bank and the IMF, are failing to meet the needs of poorer nations, especially in areas such as climate financing.

The CRA, a common fund among the BRICS central banks that offers support during a currency crisis, is limited to BRICS countries, while in 2021 the NDB opened to private projects in other emerging-market countries.

The NDB offers loans, guarantees, and other financial mechanisms to support private projects that contribute to sustainable development and building out infrastructure. It is intended to offer more flexibility, greater equality among shareholders, and easier access to funds than the World Bank, which must share its attention across 190 members.

Its lending focuses on clean energy, transportation, sanitation, and social development, and it has sought to devote 40 percent of its projects to tackling climate change. To date, the bank has approved more than $32 billion for ninety-six projects since operations began in 2016.

However, those efforts face roadblocks. The NDB is more than five times smaller than the World Bank, and experts doubt it could completely replace it. Others contend that its ambitions to redesign the global financial system have fallen short as it maintains many of the practices of its competitors. It has also faced criticism for vague commitments on environmental and social impact standards.

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Next 👉 Can a BRICS currency replace the dollar?

Hungarian Prime Minister Viktator Orbán has said he’s terrified by the contents of Ukrainian leader Vladimir Zelensky’s victory plan for the defeating Russia.Perhaps an indication he realises when (not if) Putin falls, his pro-russian and pro-chinese world will collapse on him - exposing his deceit and corruption for the world to see?

He is actually afraid of Ukraine’s victory.

“I am one of those who urge the European Union to change its current strategy. The European Union went into this war with a badly organized, badly executed, badly calculated strategy, for which the president of the Commission bears the main responsibility,” Orbán wrote, referring to Ursula von der Leyen.

“We are losing this war, so the strategy is not working. But this does not mean that we need more war, more dangerous and long-range weapons — it means that we need to change from a war strategy to a peace strategy. We need a cease-fire and peace talks!”

The Victator Orbán claimed that the EU, which has been providing Kiev with weapons and funds, has approached the conflict between Russia and Ukraine “with a poorly organized, poorly executed, poorly calculated strategy”.

“This does not mean that we need more wars, more dangerous weapons, and long-range weapons, but that we need to switch from a war strategy to a peace strategy. We need a ceasefire and peace talks,” Orbán wrote. He also muttered during a meeting of EU leaders in Brussels on October 17, 2024 - that he would urge German Chancellor Olaf Scholz and French President Emmanuel Macron to “start negotiating with the Russians as soon as possible on behalf of the entire EU.”

Viktor Orbán’s pro-Russian stance represents a significant challenge within the European Union, particularly in relation to its unified position on the war in Ukraine. Hungary has been blocking the transfer of €6.6 billion in military aid to Ukraine, a move that has frustrated many EU leaders, including Josep Borrell, the EU's chief diplomat.

This ongoing blockade, lasting over a year, reveals a divergence between Hungary and the broader EU approach to the conflict, which is largely characterized by support for Ukraine against Russia's invasion.

Orbán has long pursued closer ties with Russia, even before the war in Ukraine. Hungary's reliance on Russian energy, particularly natural gas, has shaped this stance.

Orbán has consistently defended his country's need for energy security, positioning Hungary as more accommodating to Moscow compared to other EU member states. His government has also cooperated with Russia on projects like the Paks nuclear plant, further entrenching these ties.

Throughout the conflict, Orbán has criticized the EU's sanctions regime against Russia, arguing that sanctions harm European economies more than they hurt Russia. He has frequently framed Hungary’s opposition to military and economic support for Ukraine as a matter of national interest, focusing on domestic economic stability and energy security.

Orbán's stance puts him at odds with EU leaders who are committed to a unified front against Russian aggression. Leaders like Borrell have emphasized the importance of providing military and financial support to Ukraine to defend against Russia’s invasion.

The European Peace Facility (EPF), the fund Hungary is blocking, is an off-budget mechanism designed to support the EU's foreign and defense policies, particularly through military assistance to Ukraine.

Orbán’s stance also undermines broader EU strategies aimed at isolating Russia diplomatically and economically. His reluctance to fall in line with the EU's consensus damages the bloc's credibility and unity.

By keeping the €6.6 billion blocked, Hungary is seen as impeding Ukraine's ability to defend itself, which raises tensions within the EU and between Hungary and Ukraine.

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Next 👉 Domestic considerations: State Capture and the right wing. Domestic Considerations:

Orbán’s pro-Russian stance can be understood in the context of his domestic state capture and corruption. If you are interested in learning more about this, see my thread here 👇

x.com/beefeater_fell…

Orbán masquerades as a nationalist leader who resists foreign interference and prioritizes his own survival, masquarading as Hungary's “interests” above all.

By taking a contrarian position within the EU, Orbán appeals to a segment of his right wing electorate that views the EU with suspicion and values national sovereignty. Geopolitically, Orbán's stance has alienated Hungary from some of its traditional partners in the EU and NATO, but it has also allowed him to cultivate a unique role for Hungary as a "mediator" of sorts between East and West.

This positioning could allow Orbán to leverage Hungary’s strategic importance, both within the EU and in its relations with Russia, to extract concessions or achieve favorable deals for his country.

⚠️ EU’s Response and Potential Consequences:

While EU leaders are frustrated by Orbán’s stance, their frustrations of own their own making in their collective failure to complete the Article 7 process and sanctions, under the stewardship of Von der Leyden.

Hungary has previously faced threats of sanctions and reductions in EU funds due to its democratic backsliding and rule of law violations, but Orbán has been as adept at navigating these challenges - as the EU has been inept at sanctioning Orbán using Article 7, the net result is a moral and political victory for his right wing domestic political support.

Continued obstruction of Ukraine’s aid could result in more tangible consequences for Hungary. Other member states could push for financial penalties or explore ways to bypass Hungary's veto power within the EPF.

Additionally, as the war in Ukraine drags on, Hungary’s close ties to Russia may further isolate Orbán within the EU, limiting Hungary's influence in future negotiations on a variety of policy issues.

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Next 👉 Reminder of existing sanctions levied on Orbán’s regime

This is an update on my Rare Earth Elements report, and their importance to Russia’s aggression and invasion of Ukraine. This update includes up to date production and country specific information, in the second part of the thread.

Right let’s kick this off..

What are Rare Earth Elements and why are they relevant to the illegal war being conducted by Russia on Ukrainian sovereign territories? This video offers an easy to understand explanation of Rare Earth Elements, also known as R E E or REE.

Understanding the importance of REE and it’s connection to the seizure of territory in Ukraine, which is rich in REE deposits, might explain at least one underlying reason that Russia is seizing the most abundant resource deposits, to secure it’s own future as the fossil fuels which Russia has relied on for it’s principle revenue streams, which are now be drastically reduced due to a mixture of sanctions and increased uptake of green energy sources globally.

So why is Ukraine and Rare Earth Elements so important? Let’s begin by understanding a bit more about them.

The rare earth elements (REE) are a set of seventeen metallic elements that appear on the periodic table that few of us took an interest in at school. These include the fifteen lanthanides on the periodic table plus scandium and yttrium.

Rare earth elements are an essential part of many high-tech devices. Rare earth metals are used in multiple industries, including energy production, medical equipment, military defense systems, smartphones, computers, and electric vehicles. When REE’s are used with magnesium alloys, it is a vital element in the making of aircraft engines. You can also use REE’s for studio lighting in the film industry and for making permanent magnets.

Rare earth metals have luminescent properties, making them effective in producing fluorescent tubes and LED lights. REEs like yttrium, terbium, and europium can produce different colors in light bulbs, such as red, green, and blue. Due to their luminescent properties, these metals help make LCD screens, from smartphones to large television sets.

Lanthanum helps to make approximately half of all digital camera lenses, including those used in smartphones. Its alloys are a key component in the making of batteries for hybrid and electric cars. The rare earth elements in an EV are used in electric car motors rather than batteries. The most used is Neodymium, which is used in powerful magnets for speakers, hard drives, and electric motors. Dysprosium, and other REE’s are commonly used as additives in Neodymium magnets.

Other applications of REEs include the making of microphones, headphones, lasers, and a range of commercial and military products including satellites, radar, and sonar. Although using rare earth metals in electronics contributes a small part to the final product, the product can’t function without them.

Although the amount of REE used in a product may not be a significant part of that product by weight, value, or volume, the REE can be critical for the device to function. For example, magnets made of REE often represent only a small fraction of the total weight, but without them, the spindle motors and voice coils of desktops and laptops would not be possible.

The U.S. Geological Survey news release "Going Critical" explains: “Rare-earth elements are necessary components of more than 200 products - try and google the report for further info on REE’s uses and how important they are in your day to day life, without you even knowing about them!

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Next 👉 What is the most useful Rare Earth Elements? What is the most useful Rare Earth Elements?

The answer is Neodymium. In the light REEs category, neodymium has the highest number of uses. For one, you can use it on mobile phones, medical equipment, and electric cars. It's the best rare metal for making permanent magnets. Neodymium magnets are strong and highly useful when weight and space are limiting factors.

They help make wind turbines and storage devices and hard disk drives. Moreover, you can also use them in automotive systems like audio speakers, power steering, power seats, and electric windows.

Ok, so you know about how important REE’s are for hundreds of everyday tech products, and key military equipment from communications devices to planes - who produces them?

The largest rare earth mining companies are from China, Australia, and the United States, owing to these countries generous rare earth mineral reserves and production. In 2023, these three nations collectively contributed over 90% of the global rare earth mineral production and have the highest market capitalization.

Extracting and producing rare earth elements requires higher capital investment than most traditional mining operations. China's success in this industry thus points to the country's significant advancements to stay independent in the commodity consumption sector.

China recognized the strategic value of these elements and invested heavily in building the infrastructure necessary to extract and process them as early as the 1980s. The country’s efforts have paid off and put it at the epicenter of REE production as of now.

With a history of aggressive production strategies and mineral wealth, China has maintained a formidable lead in rare earth mining. The country's mining companies capitalize on abundant resources and produce a sizable percentage of the world's mined rare earth metals.

China is the largest producer of rare earth minerals and accounts for over 70% of the worldwide output of REEs. The country saw 0.21 million metric tons annual yield of rare earth metals in 2022, and it dominates the market with its expansive mining operations.

Likewise, the advanced mining infrastructure and supportive government policies, have helped Australian mining companies extract and process REEs to meet the world's growing demand.

Rare earths processing occurs in two main stages. The first involves extracting the rare earths from ores containing other minerals and concentrating them into a mixed rare earth concentrate or carbonate. The second is a more complex stage that separates the rare earths into individual oxide compounds. From there the products are turned into metals used to produce magnets.

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Next 👉 Global dynamics of REE

The swing to the far-right is a growing trend in Europe and abroad.

What distinguishes these parties or are they all more or less the same? Do far right parties differ much from country to country? What is driving the move by nations to move towards the far right?

These and other considerations are explored in this thread, and hopefully a balanced view on the rise of the far right and nationalism across the globe.

In the past decade and more, Europe has witnessed a significant swing to the far-right in several countries, a trend that reflects broader political and societal shifts.

This movement is characterized by the rise of populist, nationalist, and anti-immigrant parties that reject traditional liberal values and prioritize a more exclusive, identity-based politics. The far-right’s resurgence is driven by a combination of economic, cultural, and political factors, with different manifestations across various countries.

While common themes run through far-right movements, such as opposition to immigration, anti-elite rhetoric, and skepticism towards the European Union, the specifics of each party’s policies reflect their unique national contexts.

Here's an overview of the swing to the far-right in Europe and what distinguishes these parties:

🥕Key Factors Behind the Rise of the Far Right 🥕

👉 Immigration and National Identity

One of the most consistent drivers of the far-right surge across Europe is opposition to immigration, particularly from non-European countries, and more recently since the invasion of Ukraine by Russia - the alignment towards Russia and Vladimir Putin and his regime.

Many far-right parties capitalize on fears about cultural dilution, loss of national identity, and the challenges of integrating large numbers of migrants. The 2015 refugee crisis, where over a million asylum seekers entered Europe, significantly boosted support for these parties, as many voters perceived mainstream parties as unable to handle the crisis effectively.

The indicted war criminal Vladimir Putin, has weaponized migration as part of his broader strategy to destabilize Europe and weaken Western unity. This tactic involves using the movement of migrants and refugees, particularly toward Europe, as a geopolitical tool to create political, social, and economic pressure on countries that oppose Russian interests.

Russia’s strategy of hybrid warfare involves using a blend of conventional military power, cyberattacks, disinformation campaigns, energy dependency, and other tools to achieve its geopolitical goals.

Weaponising migration fits within this framework, as it aims to create domestic crises in target countries without direct military confrontation.

The goal is often to exploit the vulnerabilities of open, democratic societies and use humanitarian crises, such as migration, to fuel divisions and political polarization.

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Next 👉 Examples of migration’s weaponisation Examples of migration weaponisation include:

💥 Syrian Civil War and the 2015 Refugee Crisis - Russia’s indiscriminate bombing campaigns, especially in areas held by anti-Assad rebels, drove millions of Syrians to flee the country, many of whom sought refuge in Europe.

Russia orchestrated the refugee crisis specifically to destabilize Europe, its actions in Syria certainly contributed to the conditions that led to mass displacement. Additionally, Russia’s diplomatic support for Assad has prolonged the war, which continues to generate migration flows.

💥 In 2021, Belarusian President Alexander Lukashenko, in concert with Putin, deliberately orchestrated a migrant crisis by encouraging refugees from the Middle East, Africa, and Asia to travel to Belarus and then pushing them toward the borders of EU countries like Poland, Lithuania, and Latvia.

Thousands of migrants attempted to cross into the EU through these borders, creating a humanitarian crisis and straining relations between Belarus and its European neighbors.

Lukashenko’s actions was a retaliation for EU sanctions imposed after Belarus's 2020 elections, which were widely regarded as fraudulent. Russia supported or tacitly approved of this strategy, seeing it as a way to pressure the EU and create further divisions within the bloc.

💥 In addition to direct actions, Russia has been accused of using disinformation campaigns to inflame fears and anxieties about migration within Europe.

Russian state media outlets like RT and Sputnik have frequently highlighted stories of crime and social unrest linked to migrants, particularly from Muslim-majority countries, in an effort to stoke anti-immigrant sentiment.

These narratives are often amplified by social media, which can lead to a rise in xenophobia and support for far-right political parties.

By sowing discord over immigration, Russia seeks to exploit one of Europe’s most divisive issues.

Migration has been a key factor in the political fragmentation of the EU, with countries like Hungary and Poland adopting hardline anti-immigration stances, while others, like Germany and Sweden, have promoted more open policies.

This internal division weakens the EU’s ability to present a united front on other issues, including Russia’s actions in Ukraine and its energy policies.

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Next 👉 The implications for Europe

Ferrero has been operating in Russia since 1995. For the last 10 years, the company’s total investments in the development of its Vladimir factory and the entire confectionery business in Russia has amounted to €250 million.

In the case of its Vladimir factory, in recent years it has become one of the largest producers of chocolate in Russia, accounting for 30% of the entire chocolate production in the country.

Ferrero confectionery brands have traditionally enjoyed great popularity among Russian consumers.

That was also due to big marketing campaigns, conducted by the company for the popularisation of its products in the local market during the 1990’s and at the beginning of 2000’s.

In 2018 - four years after the illegal annexation of Crimea by Russia, the global confectionery group Ferrero invested €80 million in its expanding Russian confectionery business. As part of its plans, the majority of funds are considered to be focused on the expansion of the company’s flagship factory in Russia, located in the Sobinsky area in the Vladimir, Central Russia.

Following the lines of other businesses who did not want to lose their market share over the war in Ukraine like Unilever - Nutella opted for the tried and tested corporate white-washing technique.

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Next 👉 Nutella’s corporate whitewashing of its support of Russian’s torture, rape and murder in Ukraine. The corporate whitewashing of its supporting genocide in Ukraine.

Following Russia’s illegal invasion of Ukraine in February 2022, the company adopted the corporate ruse to remain in Russia. It issued this statement:

“We will reassess our decisions on a regular basis as we continue to closely monitor the impacts of this dramatic and rapidly evolving situation, doing our utmost to safeguard people’s safety, while continuing to support colleagues in local markets who face a lot of uncertainty.

“From the outset, our top priority has been to ensure the safety of our employees, associates, and their families. We have been helping them to reach safety zones, providing them with emergency cash, fuel for their cars, food, medicines, basic supplies, and shelter.”

“Following the temporary closure of our offices in Ukraine, we have decided to temporarily pause all non-essential activities and development plans in Russia, in line with most other food companies. This includes promotions and advertising,” Ferrero said in a statement posted on its website.

According to the website of Ferrero’s local subsidiary in Russia, the company has an office in Moscow and a factory 120 miles east in Vladimir.

Ferrero initially suspended non-essential activities in Russia, including advertising, promotions, and development plans. However, the company later revised its statement to say that all non-essential activities and development plans in Russia remained on hold.

Nutella ingredients come from many countries, including Brazil, France, Malaysia, Nigeria, and Turkey. Nutella is also manufactured in factories in North America, South America, and European countries outside of Italy.

Leave-Russia .org report Nutella’s position in 2023 as:

“May 20, 2023
Initially suspended operations in Russia. The company's statement regarding Ukraine contained the following sentence: "we have decided to temporarily suspend all non-essential activities and development plans in Russia, like most other food companies".

Later this part of the statement was revised to "All non-essential activities and development plans in Russia remain on hold ”, avoiding comparison with “other food companies”. The vast majority of exports are direct.

Comparing total exports for the year beginning March 1, 2022 versus a year earlier by value, the growth is 33% ($120 million vs. $90 million). The 33% increase in value was not enough to maintain the market share of exported chocolate: it fell from 18.2% to 16.9%.”

October 2024.

Nutella’s production has continued, and increased in Russia, the business continues to support the genocidal regime with billions of Rubles paid in taxes to support the regime and its military aggression. The company continues to support the needs of all fun loving employees who also support the war in Ukraine.

Apparently supporting russians in their hour of need during their difficult and emotional times of invading a neighbour and conducting a genocide - are way more important than taking a principle stand on supporting the regime in Russia. And losing market share.

Let’s be emphatically clear.

Nutella is a sponsor of war and a supporter of the genocide of Ukrainians.

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⚠️Russian demographic time bomb ⚠️

Putin has just banned the 2029 census. To understand why, this thread will explain where Russia is at on demographics and what reason Putin might have to ban a national census in Russia. In summary the statistics show that according to the latest Rosstat vital statistics and the World Population Review in from 2019 (three years before the illegal invasion of Ukraine).

For context, Putin has been in power since 2000, and has overseen the creation of a demographic time bomb. Russia is a multinational state, home to over 193 ethnic groups nationwide. In the 2021 Census, nearly 72% of the population were ethnic Russians and approximately 19% of the population were ethnic minorities.

According to the United Nations, Russia's immigrant population is the world's third largest, numbering over 11.6 million; most of whom are from other post-Soviet states.

The demographic tragedy is unfolding in Russia. In the period 2020 - 2023 the country had lost around 2m more people than it would ordinarily have done, as a result of war, disease and exodus.

The life expectancy of Russian males aged 15 fell by almost five years, to the same level as in Haiti. The number of Russians born in April 2022 was no higher than it had been in the months of Hitler’s occupation. And because so many men of fighting age are dead or in exile, women now outnumber men by at least 10m.

War is not the sole—or even the main—cause of these troubles, but it has made them all worse. According to Western estimates, 650,000 Russian soldiers have been killed or wounded in the past year.

Estimates of between 1,000,000 and 2,000,000 mostly young, educated people and middle class workers have evaded the meat-grinder by fleeing abroad.

Even if Russia had no other demographic problems, losing so many in such a short time would be painful. As it is, the losses of war are placing more burdens on a shrinking, ailing population.

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Next 👉 ⚠️ The history pre-Ukraine invasion of Russia entering a doom loop of demographic decline ⚠️

The roots of Russia’s crisis go back 30 years. The country reached peak population in 1994, with 149m people. The total has since zig-zagged downwards. It was 145m in 2021 (that figure, from the un, excludes the 2.4m people of Crimea, which Russia illegally annexed and de-populated the Ukrainian population, and replaced them with Russian citizens in 2014 and incorporated into its national accounts).

According to 2023 UN projections, the total could be just 120m in 50 years, if current patterns persist. That would make Russia the 15th-most-populous country in the world, down from sixth in 1995.

Population decline is not unique to Russia: most post-communist states have seen dips, though not like this. Their declines have been slow but also manageable.

Russia’s population in recent decades has seen a precipitous slump, then a partial recovery (thanks to a period of high immigration from parts of the ex-Soviet Union and more generous child allowances after 2007), followed by a renewed fall.

According to the state statistics agency, in 2020 and 2021 combined the country’s population declined by 1.3m; deaths outstripped births by 1.7m. The decline was largest among ethnic Russians, whose number, the census of 2021 said, fell by 5.4m in 2010-21.

Their share of the population fell from 78% to 72%. So much for the indicted war criminal Putin’s boast to be expanding the Russki mir (Russian world).

As of the 2021 census, the population of Russia was 147.2 million. It is the most populous country in Europe, and the ninth-most populous country in the world, with a population density of 8.5 inhabitants per square kilometre (22 inhabitants/sq mi). As of 2020, the overall life expectancy in Russia at birth was 71.54 years (66.49 years for males and 76.43 years for females).

From 1992 to 2012, and again since 2016, Russia's death rate has exceeded its birth rate, which has been called a demographic crisis by analysts. Consequently, the nation has an ageing population, with the median age of the country being 40.3 years.

In 2009, Russia recorded annual population growth for the first time in fifteen years; during the mid-2010s, Russia had seen increased population growth due to declining death rates, increased birth rates and increased immigration.

Between 2020 and 2021, prior to the Russian invasion of Ukraine, Russia's population had undergone its largest peacetime decline in recorded history, due to excess deaths from the COVID-19 pandemic. In addition, at least 1 million Russians fled the country as a result of the invasion.

All this began before the war and reflects Russia’s appalling covid pandemic. The official death toll from the disease was 388,091, which would be relatively low; but The Economist estimates total excess deaths in 2020-23 at between 1.2m and 1.6m.

That would be comparable to the number in China and the United States, which have much larger populations. Russia may have had the largest covid death toll in the world after India, and the highest mortality rate of all, with 850-1,100 deaths per 100,000 people.

If you add pandemic mortality to the casualties of war and the flight from mobilisation, Russia lost between 1.9m and 2.8m people in 2020-23 on top of its normal demographic deterioration. That would be even worse than during the disastrous early 2000s, when the population was falling by roughly half a million a year.

What might that mean for Russia’s future? Demography is not always destiny; and Russia did for a while begin to reverse its decline in the mid-2010s. The impact of population change is often complex, as Russia’s military mobilisation shows. The decline in the number of ethnic Russians of call-up age (which is being raised from 18-27 to 21-30) will make it harder for the armed forces to carry out the regular spring draft, which begins in April.

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Next 👉

7.5 TRILLION RUBLES IN OIL AND GAS REVENUE FOR FIRST 8 MONTHS OF 2024.

This thread highlights the failures of Russian oil sanctions and the price cap, and the example of a Latvian National, Aleksejs Haļavins - who is currently operating out of Dubai and circumventing oil trade sanctions on behalf of Russia, significantly increasing Russia’s revenue to fund the genocide in Ukraine.

Reuters reports that Russia's oil and gas revenues surged by 41% in the first half of 2024. Putin is successfully circumventing the democratic world’s price cap on Russian oil using a “shadow fleet” of tankers to work around international sanctions. The first 8 months of oil and gas sales for Russia is comparable to the level of revenue from 2022.

The 7.5 Trillion Rubles figure, is according to the Russian Ministry of Finance in its latest results publication.

Of course, one needs to treat any data released from Putin’s regime with skepticism - he declared economic and financial data in Russia a State Secret and has since authorised opaque and manipulated results to bolster the image of Russia, designed to give the Russian people and the rest of the world the impression that the russian economy is strong, while hiding specific trade and income data that would indicate otherwise.

What is likely though, is there is an increase in revenue from fossil fuels for Russia, despite the sanctions and price caps imposed by the European Union, the G7 and others.

Another conclusion that one can make is around increasing revenues with inflation in Russia. The higher the inflation, the more expensive things get, the more the regime makes on taxes such as VAT. It is estimated that half of Russia’s oil and gas revenue, funds the war in Ukraine for Putin.

👉 Limiting Russia’s revenue on Oil:

Russian seaborne oil, by EU owned and registered or insured ships - is subject to a cap of $60 per barrel for crude oil and $100 for refined. The cost price for Russia crude, excluding state extraction taxes and transportation - is estimated at sub $15 per barrel. There are two fundamental flaws in both sanctions and the price cap approach by t he EU and G7.

👉 The price cap allows a significant level of profit for Russia in every barrel.

👉The price cap only applies to oil shipped on EU owned or registered vessels. Russia bypasses this by expanding the size of its shadow fleet, which can ship oil well over the price cap, increasing its revenues per barrel.

The EU and G7 have allowed Greek shipping magnates to sell their ageing tankers to Russia to circumvent sanctions, making a few shipping owners incredibly rich - while giving Putin what he needs to circumvent sanctions.

This pressure on carriers and insurers was the cornerstone of the “price ceiling” strategy. When faced with the problem of regulating transactions between Russian oil sellers and buyers in countries like China or India, the G7 group of economically advanced democracies — Canada, France, Germany, Italy, Japan, the United Kingdom and the United States — proposed leveraging the transport and insurance sector, which is dominated by companies heavily dependent on Western regulatory systems.

The assumption was that these companies, fearful of facing legal consequences in the Western markets where they earn much of their revenue, would refuse to handle Russian oil sold above the “ceiling.”

Russia's response was straightforward: they simply transferred tankers bought from “legitimate” carriers to “gray” and “black” companies registered in opaque jurisdictions. These shell companies operate outside the realm of Western regulatory pressure, as they do not participate in the open market.

Their sole purpose is to transport Russian oil while evading sanctions. Insurance for these shipments isn't provided by reputable global firms, but by dubious entities.

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Next 👉 The EU and G7 Price Cap has now FAILED 👉 The EU and G7 have FAILED to enforce the price caps.

One example for this is allowing the EU to trade in Russian oil above the price cap. One of the largest buyers of Russian oil above the price cap is from Latvian national Aleksejs Halavins - who has 3 Dubai based businesses conducting this trade.

Black Pearl Energy Trading LLC, which Halavins owns and runs - with affiliate companies OGC Shipping LLC and Conmar Maritime.

In 2023, Black Pearl and Halavins bought circa 38 million barrels of Russian oil from Surgutneftegaz at an average price of $82 per barrel, which is $22 per barrel above the price cap. In the first 5 months of 2024 - Black Pearl Energy Trading bought over 20.6 million barrels for an average price of $83.7 per barrel - $23.7 per barrel over the price cap.

Latvian citizen Aleksejs Haļavins, as two entities affiliated with the businessman are known to have purchased oil from Russian oil company Surgutneftegaz at a price above the cap, bringing the Russian corporation an additional $1.4 billion. Other companies linked with Haļavins operated tankers carrying oil from Russia to India and China.

Notably, Israel has accused one of these tankers of supplying oil to Lebanon's Hezbollah and Iran's Quds Force. The Insider traced Haļavins’s connection to Russian national Mikhail Silantiev, the former head of Promsyrioimport — a state-owned company sanctioned on two counts: for supplying fuel to Crimea and for supplying oil to Syria.

As a result, Surgutneftegaz alone received roughly $1.4 billion more in revenue than it would have by selling its oil at the price cap rate. The total yearly additional revenue to the Russian budget from oil sales bypassing the cap is estimated at $7-11 billion — a significant boost to the Russian war machine.

These figures were published by The Insider.

2/ Halavin investigated continued..
Next

Armenia exits the Collective Security Treaty Organization (CTSO) .

This thread is offers some context, history, Ukraine related relevance and a chronology of recent events leading to Armenia rejecting the Russian led CTSO.

👉 A little bit about Armenia..

Armenia is an ancient country. Its history dates back to well before the Bronze Age and traces the beginnings of civilization. Armenia is the first country to adopt Christianity as its state religion. Today, 97% of the Armenia’s population are Christians, and Armenia has one of the most beautiful churches in the world.

The Armenian capital, Yerevan, is one of the world’s oldest inhabited cities. Founded in 782 BC by King Argishti, it is even older than Rome. There are six UNESCO World Heritage Sites in Armenia: Haghpat Monastery, Sanahin Monastery, Echmiadzin cathedral and churches, Zvartnots archaeological site, Geghard Monastery and Azat Valley.

Mining in Armenia is concentrated around the extraction of metals iron, copper, molybdenum, lead, zinc, gold, silver, antimony, and aluminum.

Armenia is a landlocked country located in the South Caucasus region of Eurasia. Armenia is bordered by Georgia in the north, the Republics of Azerbaijan and Artsakh in the east, Nakhchiva (Azerbaijan's exclave) Iran in the south, and Turkey in the west. Armenia occupies a land area of 11,484 square miles.

The population of the country is estimated at 2.9 million. Until independence, the economy of Armenia heavily depended on industry. The industry relied on outside sources. The main domestic energy source is hydroelectric. The country’s vast majority of energy is produced with imported fuel from countries such as Russia.

Natural resources play an important role in boosting the economy of Armenia. The natural resources are used domestically and are also exported. Geographically, Armenia is mountainous. This geographical peculiarity renders the country rich in mineral resources.

The mineral resources of Armenia include iron, zinc, aluminum, copper, molybdenum, gold, lead, silver and antimony. The country is also rich in other rare and hard to find metals.

Armenia possesses some of the world’s most diverse nonmetallic minerals including tuff, zeolites, nephelite syenites, perlite, scoria, marble, pumice stone, and basalts. The industrial minerals found in the country are cement, diatomite, limestone, and gypsum.

The mining industry is, therefore, one of the principal areas of Armenia’s economy. In Armenia, 24.8% of the population lived below the national poverty line in 2022.

Armenia is the 7th safest country in the world, according to NUMBEO. The analytical platform's Crime Rate and Safety Index by Country report has ranked Armenia 7th out of 146 countries, while the city of Yerevan is 15th out of 329 cities.

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Next 👉 What is the CTSO? 👉 What is the CTSO?

The CSTO is a Russia-dominated alliance of former Soviet states that have pledged to protect one another in the event of an attack.

The Collective Security Treaty Organization (CSTO) is an intergovernmental military alliance in Eurasia consisting of six post-Soviet states: Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, and Tajikistan, formed in 2002.

The Collective Security Treaty has its origins in the Soviet Armed Forces, which was replaced in 1992 by the United Armed Forces of the Commonwealth of Independent States, and was then itself replaced by the successor armed forces of the respective independent states.

Similar to Article 5 of the North Atlantic Treaty and the Inter-American Treaty of Reciprocal Assistance, Article 4 of the Collective Security Treaty (CST) establishes that an aggression against one signatory would be perceived as an aggression against all.

The 2002 CSTO charter reaffirmed the desire of all participating states to abstain from the use or threat of force. Signatories are prohibited from joining other military alliances.

The CSTO holds yearly military command exercises for the CSTO nations to have an opportunity to improve inter-organizational cooperation. The largest of such exercises was held in Southern Russia and central Asia in 2011, consisting of more than 10,000 troops and 70 combat aircraft.

On 4 February 2009, an agreement to create the Collective Rapid Reaction Force (KSOR) was reached by five of the seven members, with plans finalized on 14 June. The force is intended to be used to repulse military aggression, conduct anti-terrorist operations, fight transnational crime and drug trafficking, and neutralize the effects of natural disasters.

Belarus and Uzbekistan initially refrained from signing on to the agreement. Belarus did so because of a trade dispute with Russia, and Uzbekistan due to general concerns. Belarus signed the agreement the following October, while Uzbekistan has never done so.

The Collective Security Treaty Organization (CSTO) maintains a peacekeeping force that has been deployed to areas of conflict, including Tajikistan and Kyrgyzstan. The force is composed of troops from member states and is designed to provide stability and security in the region.

On 6 October 2007, CSTO members agreed to a major expansion of the organization that would create a CSTO peacekeeping force that could deploy under a United Nations mandate or without one in its member states. The expansion would also allow all members to purchase Russian weapons at the same price as Russia.

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Next 👉 A potted history of Putin squeezing Armenia

August 2024, - the EU countries are continuing to prop up revenue for Putin’s regime and the murderous onslaught against Ukraine.

The EU’s State of the Energy Union Report 2024, published on September 11, 2024 - sets out that the EU is trying to quickly replace Russian gas supply and ensure Europe’s energy security in the short-medium term. To do so the EU has reached out to other international suppliers.

Norway and the U.S. have become the EU's largest gas suppliers - for pipeline and LNG gas respectively- providing 34% and 18% of EU gas imports in the
first half of 2024.

The EU claims that a record of twelve new LNG terminals and six expansion projects of existing terminals have been commissioned between 2022 and 2024.

Overall, these are expected to increase the EU’s LNG import capacity by 70 bcm to 284 bcm by 2024.

Remember - In May 2022, the Commission responded to the European Council’s demand to phase out Europe’s dependency on Russian energy imports as soon as possible by adopting the REPowerEU Plan.

The objective was to rapidly reduce the EU’s dependence on Russian fossil fuels not only by saving energy and diversifying our supplies, but especially working towards the long-term objective to fast-forward the clean transition via the acceleration of renewables deployment and energy efficiency measures, joining forces to achieve a more resilient energy system and a true Energy Union.

Immediate actions focused on saving energy and enhancing energy efficiency as the cleanest and cheapest way to address the energy crisis. Actions undertaken under REPowerEU allowed one of the steepest gas demand decline in history.

In parallel to EU sanctions banning seaborne imports of Russian crude oil and refined petroleum products12 as well as Russian coal, imports of Russian gas (pipeline & LNG) dropped from a 45% share of overall EU gas imports in 2021 to only 18% in the first half of 2024.

Yet the enormous volumes of continued revenue reported by Crea for August 2024 volumes, show that the EU still provides significant income for Russia, for its fossil fuels - arguably a different reality to the one the EU suggests in it’s latest energy report.

The ongoing purchase of Russian fossil fuels by EU countries, despite sanctions, highlights the complexities and contradictions within Europe's energy policy and its efforts to reduce dependence on Russian energy amid the Ukraine conflict. Several key points arise:

The EU's decision to exempt certain Russian fossil fuels from sanctions, particularly crude oil imported through the southern branch of the Druzhba pipeline to Hungary, Slovakia, and the Czech Republic, demonstrates the difficulty of fully severing ties with Russian energy.

These exemptions likely stem from the fact that many of these countries, especially landlocked ones like Hungary, Slovakia, and the Czech Republic, have limited alternatives to replace Russian fossil fuel imports.

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Next 👉 Crea report for August 2024 Crea’s latest publication sets out the data on Russia’s fossil fuel revenue in August 2024 (please see the references tweet for a link to the full report).

👉 In August, the top five largest Russian fossil fuel importing countries in the EU paid Russia a total of EUR 1.2 bn for their imports. The EU has granted an exemption for Russian crude oil imported through the southern branch of the Druzhba pipeline to Hungary, Slovakia, and the Czech Republic. Russian pipeline gas and liquified natural gas (LNG) also remain unsanctioned.

👉 Hungary was the largest importer of Russian fossil fuels within the EU, importing fossil fuels worth EUR 369 mn. Their August imports included crude oil via pipeline valued at EUR 155 mn and gas valued at EUR 214 mn.

👉 France, the second-largest buyer within the EU, exclusively imported LNG worth EUR 219 mn.

👉 Slovakia was the third-largest importer of Russian fossil fuels within the EU, importing pipeline oil and gas worth EUR 61 mn and EUR 130 mn, respectively.

👉 Austria exclusively imported pipeline gas worth EUR 177 mn.
Italy, the fifth-largest buyer within the EU, imported Russian pipeline gas valued at EUR 174 mn.

👉 LNG: The EU was the largest buyer, purchasing 50% of Russia’s LNG exports, followed by China (21%) and Japan (18%).

👉 Pipeline gas: The EU was the largest buyer, purchasing 40% of Russia’s pipeline gas, followed by China (28%) and Turkey (25%).

Globally - the revenue streams have seen marginal drops:

In August 2024, Russia’s monthly fossil fuel export revenues dropped 8% to EUR 636 mn per day, marking the fifth consecutive month of decline.
Revenues from seaborne crude oil (EUR 186 mn per day) dropped 14% month-on-month. A significant reason for this drop was an 8% drop in the volume of exports.

👉 Meanwhile, revenues from crude oil via pipeline (EUR 77 mn per day) dropped by 4% in August.

👉 Russian revenues from seaborne oil product exports declined 7% month on month, dropping to EUR 206 mn per day.

👉 LNG export revenues increased by 55% month-on-month to EUR 42 mn per day.

👉 Russia benefitted from a 4% month-on-month rise in revenues from pipeline gas to EUR 73 mn per day.

👉 Russian revenues from coal exports dropped 28% month-on-month to EUR 49 mn per day — the fifth consecutive month they’ve dropped.

👉 Coal: From 5 December 2022 until the end of August 2024, China purchased 45% of all Russia’s coal exports, followed by India (18%). Turkey (10%), South Korea (10%), and Taiwan (5%) round off the top five buyers list.

👉 Crude oil: China has bought 47% of Russia’s crude exports, followed by India (37%), the EU (6%), and Turkey (6%).

👉 Oil products: Turkey, the largest buyer, has purchased 24% of Russia’s oil product exports, followed by China (12%) and Brazil (11%).

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Next 👉 EU countries called out

The Vertical Gas Corridor is the key to the energy security of Ukraine, Moldova and the countries of South East Europe in the long term, confirmed the natural gas transmission system operator of Bulgaria, Bulgartransgaz in March 2024.

“After the probable end of the transport of natural gas from Russia through Ukraine from the start of 2025, the Vertical Gas Corridor will be the only project that can provide both the required transport of liquefied natual gas and the continuation of the operation of the gas transmission network and the underground gas storage facilities in Ukraine,” the CEO of Bulgartransgaz explained.

It is now certain that Ukraine will end transition of Russian gas from the end of 2024.

Bulgaria consumes about 3 billion cubic meters (bcm) of natural gas. The Gas Interconnector Greece-Bulgaria natural gas pipeline became operational in 2022, and Bulgaria receives about 1 bcm a year from Azerbaijan, with a long-term contract at a price linked to the international oil price. In April this year, Azerbaijani gas accounted for 51.1% of Bulgaria’s domestic consumption.

Bulgaria also purchases oil to feed its Burgas refinery, which has a capacity of 190,000 barrels per day (bpd) and is operated by Russia's Lukoil. Bulgaria was the fourth largest buyer of seaborne Russian oil in 2023, purchasing over 100,000 bpd.

Bulgaria is however replacing Russian oil imports with crude from Kazakhstan, Iraq and Tunisia in January, according to traders and LSEG data.

Bulgaria has a waiver from a European Union embargo that allows it to continue seaborne imports of Russian oil in 2024. But the country has restricted exports of all refined products produced from Russian crude from this month, which makes it almost impossible for its sole refinery to run on Russian oil, and has decided to stop all Russian crude imports from March.

When flows from the Yamal and NordStream 1 pipelines halted, the CEE region had to rapidly adapt to the new reality (see Figure 1 for more details). Poland stopped sending gas to Germany, and German flows into the Czech Republic were slashed to one-fifth. Czechia then opted to receive gas from Slovakia, reversing years of flow in the opposite direction.

Similarly, Slovak flows into Austria were reduced by more than two-thirds, which in turn saw their exports to Hungary and Italy almost disappear by the end of 2023.

Further east, the inauguration of the Balkan Stream pipeline in 2021 provided some relief to the region, allowing flows from the TurkStream pipeline to reach Romania, Serbia, and Hungary, and giving the latter the opportunity to export gas to Slovakia since 2023.

However, not every country benefited from the project: Bulgaria and Moldova stopped consuming Russian gas in 2022 following disputes involving long-term contracts with Gazprom. This overhaul of the gas market resulted in a rebalancing of geopolitical power in the region.

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Next 👉 Context Context:

After the halt of Russian gas flows through the Yamal and NordStream 1 pipelines in 2022, the region now risks losing the Russian supply it receives via Ukraine. Ukraine has expressed its intention not to renew the transit contract with Russia, set to expire by the end of the year.

With the expected end of Russian gas transit through Ukraine at the end of this year, the Balkan Stream gas pipeline through Bulgaria will become the main supply route for the EU and Ukraine, as discussed during the visit of the EU’s top energy official, Ditte Juul Jorgensen, to the dispatch centre of state-owned gas company Bulgartransgaz (BTG).

In the long term, Bulgaria will become an important transit country to ensure supplies to Romania, Moldova and the countries of south-eastern Europe.

“After the probable termination of the transmission of natural gas from Russia through Ukraine from the beginning of 2025, the vertical gas corridor through Bulgaria will be the only project that can ensure both the necessary transmission of liquefied gas and the continued operation of the gas transmission network and underground gas storage facilities in Ukraine,” said Vladimir Malinov, head of Bulgartransgaz.

Data from the EU Commission show that since the start of Russia’s invasion of Ukraine, the EU has drastically reduced its imports of Russian gas from more than 50% to 15% last year. In total, 9% of Russian gas supplies to the EU come via pipelines, with the remainder being liquefied gas. Following the suspension of the Ukrainian gas corridor, supplies to the EU and Ukraine will have to pass mainly through Bulgaria.

The Balkan country operates the Balkan Stream gas pipeline, which is a continuation of Turk Stream, a gas pipeline that was inaugurated exactly one year before the Russian invasion of Ukraine. Russian President Vladimir Putin’s project to bypass Ukraine was supported by the former leaders of Bulgaria, Turkey, and Serbia – Recep Tayyip Erdoğan, Boyko Borissov and Aleksandar Vučić.

After the outbreak of the war, Russia cut off gas supplies to Bulgaria, but the authorities in Sofia did not interfere with the transit of Russian gas to Serbia, Hungary and from there to Austria. Separately, Bulgaria and Greece built a gas interconnector linking the Bulgarian gas network to the Trans-Adriatic Gas Pipeline, which carries gas from Azerbaijan.

This connection also allows the transfer of LNG from the Greek terminals and the import of LNG from the Russian terminals via the Balkan Stream.

Currently, Bulgaria and Romania are not using the potential of the Trans-Balkan gas pipeline, which was the old route for the transit of Russian gas from Ukraine through Romania to Bulgaria before the launch of the Turkish Stream. The idea of the authorities in Sofia is to reverse the direction of this gas pipeline and make Bulgaria a gas export route to Romania and Ukraine.

This project is called the Vertical Gas Corridor and is a joint project of the gas companies of Greece, Bulgaria, Romania, Hungary, Slovakia, Moldova and Ukraine to extend the existing gas connections between them.

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Next 👉 Kpler analysis of russian gas interruption

The International Monetary Fund (IMF), a potted history, it’s makeup, it’s role in Ukraine and current relationship with Russia, and news of the move by the IMF in September 2024 - to appoint a US sanctioned russian to the board of the IMF, a close connection to the indicted war criminal Vladimir Putin.

This thread is not a comprehensive view and history of the IMF, it brings together key reported information and facts that will provide you with a better understanding.

The thread is long - have you considered bookmarking and listening to the podcast version (see the reply to the last tweet in the thread for a link), or keep an eye out for the YouTube version which should be released in the coming days.

Please remember to like and share this post, it will help with the reach of information to a wider audience.

👉 IMF History

The IMF is an United Nations (UN) specialised agency, founded at the Bretton Woods Conference in 1944 to secure international monetary cooperation, to stabilize currency exchange rates, and to expand international liquidity (access to hard currencies).

The first half of the 20th century was marked by two world wars that caused enormous physical and economic destruction in Europe and a Great Depression that wrought economic devastation in both Europe and the United States.

These events kindled a desire to create a new international monetary system that would :

💰stabilize currency exchange rates without backing currencies entirely with gold;
💰 to reduce the frequency and severity of balance-of-payments deficits (which occur when more foreign currency leaves a country than enters it);
💰 to eliminate destructive mercantilist trade policies, such as competitive devaluations and foreign exchange restrictions

…all while substantially preserving each country’s ability to pursue independent economic policies.

Multilateral discussions led to the UN Monetary and Financial Conference in Bretton Woods, New Hampshire, U.S., in July 1944. Delegates representing 44 countries drafted the Articles of Agreement for a proposed International Monetary Fund that would supervise the new international monetary system.

The framers of the new Bretton Woods monetary regime hoped to promote world trade, investment, and economic growth by maintaining convertible currencies at stable exchange rates.

Countries with temporary, moderate balance-of-payments deficits were expected to finance their deficits by borrowing foreign currencies from the IMF rather than by imposing exchange controls, devaluations, or deflationary economic policies that could spread their economic problems to other countries.

After ratification by 29 countries, the Articles of Agreement entered into force on December 27, 1945. The fund’s board of governors convened the following year in Savannah, Georgia, U.S., to adopt bylaws and to elect the IMF’s first executive directors.

The governors decided to locate the organization’s permanent headquarters in Washington, D.C., where its 12 original executive directors first met in May 1946. The IMF’s financial operations began the following year.

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Next 👉 Structure and objectives 👉 Structure of the IMF

The IMF is headed by a board of governors, each of whom represents one of the organization’s approximately 180 member states. The governors, who are usually their countries’ finance ministers or central bank directors, attend annual meetings on IMF issues.

The fund’s day-to-day operations are administered by an executive board, which consists of 24 executive directors who meet at least three times a week.

Eight directors represent individual countries (China, France, Germany, Japan, Russia, Saudi Arabia, the United Kingdom, and the United States), and the other 16 represent the fund’s remaining members, grouped by world regions. Because it makes most decisions by consensus, the executive board rarely conducts formal voting.

The board is chaired by a managing director, who is appointed by the board for a renewable five-year term and supervises the fund’s staff of about 2,700 employees from more than 140 countries. The managing director is usually a European and—by tradition—not an American. The first female managing director, Christine Lagarde of France, was appointed in June 2011.

Each member contributes a sum of money called a quota subscription. Quotas are reviewed every five years and are based on each country’s wealth and economic performance—the richer the country, the larger its quota.

The quotas form a pool of loanable funds and determine how much money each member can borrow and how much voting power it will have.

For example, the United States’ approximately $83 billion contribution is the most of any IMF member, accounting for approximately 17 percent of total quotas. Accordingly, the United States receives about 17 percent of the total votes on both the board of governors and the executive board.

The Group of Eight industrialized nations (Canada, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States) controls nearly 50 percent of the fund’s total votes.

👉 The IMF’s Primary Objectives;

(a). To Promote exchange stability throughout the world

(b). To Promote international monetary cooperation;

(c). To Facilitate the expansion and balanced growth of international trade;

(d). To Assist in the establishment of a multilateral system of payments; and

(e). Make resources available to members experiencing Balance of Payments difficulties.

Publications:

IMF provides periodic assessments of global prospects in its "World Economic Outlook", of financial markets in its "Global Financial Stability Report", of public finance developments in its "Fiscal Monitor", and of external positions of the largest economies in its "External Sector Report", in addition to a series of Regional Economic Outlooks.

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Next 👉 IMF’s operation

04 September, 2024 - The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated 10 individuals and two entities as part of a coordinated U.S. government response to Moscow’s malign influence efforts targeting the 2024 U.S. presidential election.

Russian state-sponsored actors have long used a variety of tools, such as generative artificial intelligence (AI) deep fakes and disinformation, in an attempt to undermine confidence in the United States’ election processes and institutions.

Beginning in early 2024, executives at RT—Russia’s state-funded news media outlet—began an even more nefarious effort to covertly recruit unwitting American influencers in support of their malign influence campaign.

RT used a front company to disguise its own involvement or the involvement of the Russian government in content meant to influence U.S. audiences.

“Today’s action underscores the U.S. government’s ongoing efforts to hold state-sponsored actors accountable for activities that aim to deteriorate public trust in our institutions,” said Secretary of the Treasury Janet L. Yellen. “Treasury will not waver in our commitment to safeguarding our democratic principles and the integrity of our election systems.”

Today’s designations complement law enforcement actions taken by the Department of Justice and the Department of State’s designation of the Rossiya Segodnya media group and five of its subsidiaries, RIA Novosti, RT, TV-Novosti, Ruptly, and Sputnik, as Foreign Missions, steps to impose visa restrictions, and release of a Rewards for Justice (RFJ) reward offer of up to $10 million relating to information pertaining to foreign interference in a U.S. election.

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Next 👉 Sanctions target RT (Russia Today) Sanctions targeting russian propagandists and RT:

RT, formerly Russia Today, is a Russian state-funded news outlet that began broadcasting internationally in 2005. In 2017, RT registered as an agent of a foreign government in the United States.

Beginning in early 2024, RT executives began an effort to covertly recruit unwitting American influencers. RT used a front company to disguise its own involvement or the involvement of the Russian government.

Margarita Simonovna Simonyan (Simonyan) is the Editor-in-Chief of RT and a central figure in Russian government malign influence efforts. She allowed the operations of a front company to occur under the cover of RT.

Elizaveta Yuryevna Brodskaia (Brodskaia) is the Deputy Editor-in-Chief of RT, who has reported to Russian President Putin and other government officials. Anton Sergeyvich Anisimov (Anisimov) is an RT Deputy Editor-in-Chief, who conducts activities on behalf of the Russian Federal Security Service (FSB).

Andrey Vladimirovich Kiyashko (Kiyashko) is the Deputy Director of the RT English-Language Information Broadcasting and is responsible for updating Russian government officials and providing an overview of RT’s operations.

Konstantin Kalashnikov (Kalashnikov) is RT’s Digital Media Projects Manager, who, in early 2022, worked with Kiyashko. In mid‑2023, Brodskaia and Kiyashko implemented a large-scale influence operation for RT on U.S. social media with the intent of obscuring RT’s connection to the content meant to influence online audiences.

Elena Mikhaylovna Afanasyeva (Afanasyeva) is an employee of RT’s Digital Media Projects Department and reports to Kalashnikov. Starting in early 2024, Afanasyeva covertly interacted with prominent U.S. social media influencers under the cover of a fake persona, purporting to be an employee at a U.S. company to obscure RT’s and the Russian government's involvement.

The pro-Kremlin hacktivist group RaHDit is composed of active and former Russian intelligence officers. Aleksey Alekseyevich Garashchenko (Garashchenko) is the head of RaHDit and was an FSB officer at the time he started leading the group.

Garashchenko directly interacts with members of the Russian intelligence and security services, members of the Russian Presidential Administration, and employees from RT.

Anastasia Igorevna Yermoshkina (Yermoshkina) is an affiliate of Garashchenko. Aleksandr Vitalyevich Nezhentsev (Nezhentsev) works with Garashchenko and is an administrator and developer of cyber tools used by the FSB. Nezhentsev also leads a team focusing on developing new tools that can be used in the surveillance of information data files.

Today, OFAC designated Simonyan, Brodskaia, Anisimov, Kiyashko, Kalashnikov, Afanasyeva, Garashchenko, Yermoshkina, and Nezhentsev pursuant to E.O. 14024 for being owned or controlled, or having acted or purported to act for or on behalf of, directly or indirectly, the Government of the Russian Federation.

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Next 👉 Sanctions implications

Mongolia threatens Putins pipeline deal. Putin rushes to Mongolia to save the deal, risking arrest under the ICC warrant of arrest.

Mongolia is a key transit route for new Russia-China pipeline. The landlocked country is a key transit route for Russian gas supplies to China and will host almost 1000 kilometres of the planned Sila Sibiri 2 pipeline.

With capacity of 50 billion cubic metres of gas per annum, the project aims to help replace volumes lost after Russia almost halted its pipeline gas exports to Europe in 2022 following its invasion of Ukraine.

Russian state-controlled gas giant Gazprom and the Russian government have repeatedly assured that talks are progressing with China and Mongolia over the Sila Sibiri 2 route and gas supply terms.

On June 2, the Financial Times (FT) reported that China and Russia did not conclude a deal on the pipeline because China demanded to receive it at Russia’s subsidized domestic prices and that it would only purchase a small fraction of the pipeline’s planned annual capacity.

But reported on August 22nd, 2024 - The planned pipeline intended to transport gas from Russia to northeastern China known as Power of Siberia-2 has likely fallen through. Former Mongolian Security Council member Munkhnaar Bayarlkhaag said Moscow has failed to reach an agreement with Beijing.

Bayarlkhaag added that Beijing might’ve been displeased with Russian state-owned energy conglomerate Gazprom’s potentially obtaining unilateral control over the Mongolian section of the pipeline. “This would have meant a sudden and long-term increase in Moscow’s influence in Mongolia, to the detriment of Beijing,” he said. “Though never explicitly verbalized, it would have been ‘fair’ to include the Chinese into the Mongolian section’s development from the beginning.”

The South China Morning Post (SCMP) reported on Monday, Aug 19, Mongolia, whose territory the pipeline would transit through, did not include the project in its national development plans through 2028.

Although Russia has seen an increase in gas exports to China through the Power of Siberia 1 pipeline, this has not been sufficient to compensate for the decline in European exports.

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Next 👉 Mongolia’s decoupling from Russian gas and their obligation to arrest Putin. Mongolia has rolled out a plan to end its energy shortfall by the end of 2028, long before it expects cheap Russian gas to finally start flowing into the country.

The Mongolian parliament’s final approval this week of a government-proposed, five-year development plan that excludes any gas input from Sila Sibiri 2, means the nation will need to rely on coal, hydropower and renewable energy sources to eliminate energy shortfall, according to a copy of the plan available on the parliament’s website.

According to the development plan, two hydropower stations with a total capacity of 400 megawatts, and one 450-MW coal-fired power plant are to be built before the end of 2028 to answer the increasing energy demands of the country and its capital Ulaanbaatar, where energy use exceeds available supply by about one third during winter.

As well as the proposed new power plants, Mongolia’s energy policy will also focus on wind and solar energy sources, the plan said. The country is estimated to have an ultimate capacity to produce 2600 gigawatts of renewable power, which could potentially cover its energy needs and provide capacity to export electricity to neighbouring countries, according to the approved document.

Putin risks being arrested in Mongolia - he arrived on Monday 02 September, 2024 - for a state visit in Mongolia, which lies on the route of a planned new gas pipeline connecting Russia and China. He is clearly desperate to prevent the collapse of the pipeline deal with Mongolia. He is due to hold talks with Mongolian President Ukhnaagiin Khurelsukh on Tuesday.

Ukraine urged Mongolia last week to arrest Putin on a warrant issued by the International Criminal Court warrant last year, when it accused him of the war crime of illegally deporting hundreds of children from Ukraine. The Kremlin has dismissed the accusation, saying it is politically motivated, and has said it has no worries about Putin making the trip.

The warrant obliges the court's 124 member states, including Mongolia, to arrest Putin and transfer him to The Hague for trial if he sets foot on their territory.

What will the consequences be if Mongolia fails to arrest Putin - have they given Putin cast iron assurances that they will not meet their obligations as an ICC signatory? What will the @IntlCrimCourt do if Mongolia fails in its obligation to arrest Putin?

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Debunking the malinformation - Ukrainian drone strikes are just a temporary inconvenience.

Foreign Policy has published many insightful think-tank opinions on Russia and the illegal war conducted by Russia in Ukraine, (see references tweet).

However - I take substantial issue with a recent publication that purports Ukrainian drone strikes have minimal effect.

The article was published by a so-called “energy expert” Sergey Vakulenko, from Carnegie Russia Eurasia Center. The article suggests that while the drone strikes are a boost to Ukrainian morale - they have little effect on Russia’s oil revenues.

In April 2023, the Carnegie Russia Eurasia Center opened in Berlin, Germany. who wrote for the Carnegie Russia Eurasia Centre. @CarnegieRu / @CarnegieEndow. The center focuses on major policy challenges across the wider region in the wake of the Russian invasion of Ukraine. It is home to the digital publication Carnegie Politika. The current director of the center is Alexander Gabuev.

Key points in the publication:

So far this year, Ukraine says that it has successfully attacked more than 30 Russian oil installations, some deep inside Russia.

“The latest estimates are that about 17 percent of Russia’s (admittedly ample) oil-refining capacity has been damaged to some extent by the strikes. But more broadly, Russia continues to export huge volumes of oil and even a fair bit of natural gas, ensuring that oil revenues continue to fuel its war machine

In some ways, the energy fight is an adjunct to the fight on the battlefield. Ukraine’s ability to damage (even for short periods of time) Russian refineries and fuel depots is meant, in part, to undermine logistics for the Russian army, which continues to occupy large swaths of southern and eastern Ukraine.

Blowing up expensive installations deep inside Russia is also a psychological boon for Ukraine, which has been largely on the back foot since early 2022. Russia’s systematic destruction of the Ukrainian electric power grid, meanwhile, is meant to undermine civilian morale and resilience ahead of winter.”

The White House had initially warned Kyiv not to strike Russian oil installations, fearing Russian reprisals as well as an inconvenient spike in oil and gasoline prices ahead of the U.S. election, but Ukraine has plowed ahead regardless (just as it did with the Kursk incursion).

The big question is: Do all the eye-grabbing explosions at refineries and fuel depots make much of a difference to Russia’s surprisingly resilient oil-based economy?

But the damage done is brief and relatively easy to repair,” said Sergey Vakulenko, an energy expert at the Carnegie Russia Eurasia Center. “Will it make drastic impacts on Russian oil revenues? Probably not. The drones cannot do what the sanctions were unable to achieve.”

In some cases, Vakulenko said, the oil installations that Ukraine is targeting, chosen because they are within easy range of drones, may not be the critical marks that Kyiv imagines.

Many of the older refineries in western Russia were built to take advantage of export customs loopholes that made it more beneficial to export barely refined oil products, even very low-quality ones, than to export regular crude.

These aren’t the crown jewels, but the cracked zircons. “The benefits of hitting those refineries may not be what the Ukrainians thought,” said Vakulenko, who was previously an oil executive at Russian and international companies.”

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Next 👉 Debunking the mal-information Debunking this view:

This report smacks of a biase from the start, showing a reluctance to recognise the facts or credit the real and wider impact drone strikes have on Russia.

This biased opinion is highlighted from the outset where the author says 17 percent of Russia’s oil-refinery has been damaged “to some extent” and “admittedly ample”. To admit something reluctantly has strong overtones that the opposite is about to be argued, and true to form - the article then sets out to minimise the perceived impact of drone strikes on Russia oil infrastructure.

The author of this article, a “senior fellow” and “energy expert” Sergey Vakulenko, from Carnegie Russia Eurasia Center.

In April 2023, the Carnegie Russia Eurasia Center opened in Berlin, Germany. The center focuses on major policy challenges across the wider region in the wake of the Russian invasion of Ukraine. It is home to the digital publication Carnegie Politika. The current director of the center is Alexander Gabuev.

Challenging the analysis:

👉 The assertion is that oil installations being targeted are within easy range of drones, is misleading.

In fact a growing number of attacks are penetrating deep into Russia. For example, Reuters reported on May 9, 2024 - “A Ukrainian drone struck a major oil processing plant in Russia's Bashkiria region on Thursday from some 1,500 km (932 miles) away, its longest-range such attack since the start of the war.”

The Kyiv source said the drone flew 1,500 km, calling it a record, and hit a catalytic cracking unit in an attack that showed "Russian refineries and oil depots serving the military complex cannot feel safe even in the deep rear".

While the article published on foreignpolicy. Com suggests hitting a catalytic cracking is of little consequence and easily repaired, tries to diminish the effects of ordinary Russians and oil refinery employees having their businesses attacked in the plain sight of day - 1500km from the nearest Ukraine border.

👉In terms of the impacts of the drone strikes.

The suggestion the impact is minimal sounds like a Kremlin playbook response. Ukraine has stepped up its drone attacks on oil processing facilities in Russia since the start of the year, disrupting 15% of Russia's oil refining capacity according to an estimate by a NATO official at the beginning of April.

15% of Russia’s refining capacity of 5.2 million barrels per day (According to Bloomberg, Russia refined 5.2 million barrels of oil per day on average in April 2024, compared to 5.5 million in January. ). This the equivalent of 780,000 barrels per day of refined oil income.

Hydracarbonprocessing .com reported that Russia's primary offline oil refining capacity has been raised by 114% from the previous plan to 4.1 million metric tons for June mainly to due to last-month stoppages at the Tuapse and Komsomoslk plants, Reuters calculations show. Llll reported “In May, idle capacity stood at 3.8 MMt.

The Russian oil refining industry has been targeted by Ukrainian drone attacks. Technical outages have also contributed to idle capacity. Russia and Ukraine have both used drones to strike critical infrastructure, military installations and troop concentrations in their more than 2-yr conflict, with Kyiv hitting Russian refineries and energy facilities in recent months.

According to the current plan, which is likely be revised upward, the offline refining capacity in July is seen declining to 1.8 MMt, according to Reuters calculations based on data from industry sources.

To suggest the impact of the drone strikes on Russia’s oil refining capacity is just a “psychological boon”, with minimal, temporary or of no consequence - is misleading and factually incorrect.

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Next 👉 Catalyst Crackers..

Selling more oil at higher prices ought to be the stuff of dreams for a petrostate. But for Russia it is a sign of a new, punishing phase in its war with Ukraine.

Months of Ukrainian drone strikes on refineries have crimped Russia’s ability to produce refined fuels, such as diesel and petrol, and turned the world’s third-largest oil producer into an importer of petrol.

Russian oil companies have tried to pare their losses by selling unrefined oil overseas, pushing exports to a new highs in 2024.

Despite the US administration’s fears that the global oil and fuel market could be destabilised, the price dynamic for both categories of commodities to date does not suggest that the Ukrainian strikes have driven prices up.

On the contrary, the need to reduce processing and the impossibility of storing crude have forced Russian exporters to increase exports. At the same time, the refinery shutdowns have driven down sales of petroleum products abroad, resulting in losses primarily for Russian companies.

The Ukrainian attacks and the resulting drop in fuel production have created a number of challenges for the Kremlin, including the need to deal with logistical tensions, strengthen air defence and increase imports of petroleum products.

Given the political importance of fuel availability, reduced processing has forced the Russian government to use tools of intervention in order to ensure that the market is adequately saturated.

For example, it has forced the fuel sector to redirect supplies onto the domestic market at the expense of the foreign markets.

Should the Ukrainian strikes continue and cause more temporary shutdowns at refineries, the government will probably have to step up its intervention, and that will generate costs for the state and may lead to market imbalances.

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Next 👉 A convenient target Refineries are a convenient target.

Oil is seen as the mainstay of the Russian economy, so elements of the oil industry are obvious and symbolic targets. Unlike oil fields, which are vast with dispersed islands of equipment and located in remote Siberia, refineries appear to be a far more rewarding target.

Refineries cost tens of billions of dollars to build; they are large targets and therefore hard to miss; and there is a lot of flammable and explosive matter, making substantial fire damage probable after the hit. There are also plenty of Russian refineries relatively close to Ukrainian territory.

From the attack planners’ standpoint, it would be ideal if Russia were not only to lose export volumes, but also experience difficulties in supplying enough fuel for its army and economy.

To seriously affect Russia’s refined oil market - significant attacks are required, as Russian refining capacity is 2.5 times bigger than its fuel consumption. Evidently the ongoing refinery attacks are working as Russia implemented a ban on refined exports.

From the attack planners’ standpoint, it would be ideal if Russia were not only to lose export volumes, but also experience difficulties in supplying enough fuel for its army and economy. Alas, that would require a very large-scale attack, as Russian refining capacity is 2.5 times bigger than its fuel consumption.

This logic is not new. Eighty years ago, U.S. and British military planners had a similar idea: to bring Germany and its army to its knees by targeting oil refineries in Germany, Austria, and Romania. For a year from May 1944, over 200,000 tons of bombs were dropped in more than 600 raids, with about 2.5 percent landing on refinery installations. Even under that scale of attack, after the initial shock, German fuel production stabilized at about 40 percent of its previous level.

News reports show that damaged units at many of the refineries were brought back in operation after two to three weeks of repairs, and Bloomberg-reported refining volumes are down from their peaks but above the troughs and again within the customary volume band.

But the capacity to repair refineries is severely restricted now in Russia - the equipment and technology is largely dependent on western companies, who have exited Russia since the illegal invasion of Ukraine.

Some shortages of fuel in Russia became evident in early 2024. Russia did import some volumes of gasoline from Belarus, which was widely celebrated by the media. But the volume in question was a single trainload in one week—less than 0.5 percent of one week’s consumption—while Russia kept exporting naphtha (straight-run gasoline) and diesel.

Considering that not a single unit converting naphtha into gasoline was subject to an attack, that import was most likely for logistical reasons, rather than because of a countrywide shortage of fuels.

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Next 👉 Russian regime interventions

Two can play the ignore game. But there can only be one winner.

👉 Russian Gas to Europe:

The energy implications of the Kursk invasion go far beyond Russia. At Sudzha, a pipeline sends Russian natural gas to the EU. While it may come as a surprise to many given the war in Ukraine, European countries like Austria, Hungary and Slovakia still buy gas from Russia – all of it flowing through the town of Sudzha in Kursk.

Sudzha, located about 10km (6 miles) from the Ukrainian border, plays a key role in the transit of natural gas to the EU. An average of 42 million cubic metres (1.5 billion cubic ft) of Russian gas flows into Ukraine every day, the town playing host to a gas metering system that measures supplies flowing into Europe.

Despite the war with Russia, Kyiv has allowed the gas to continue flowing through its Soviet-era gas pipeline unabated as part of a $2bn-a-year contract between state-owned Naftogaz and Russia’s Gazprom.

👉 Russian Oil to Europe:

The European Commission has said there was “no immediate risk” of oil shortages in Hungary or Slovakia after the two countries complained about Ukraine’s decision last month to place sanctions on Russian supplier Lukoil, which transits exports to the two countries via the war-torn country.

While the EU as a whole has moved to diversify its oil and gas supplies away from Russia, the two eastern members have continued to receive oil via the Soviet-era Druzhba (Friendship) pipeline, and Ukraine’s move prompted Budapest and Bratislava to demand intervention from the Commission.

The Druzhba oil pipeline has remained functioning following Moscow's invasion of Ukraine in 2022, even as the EU weaned itself off most other sources of Russian energy. The southern branch of the pipeline runs via Ukraine to the Czech Republic, Slovakia and Hungary, and has been the primary source of supply for their refineries for years.

A few countries in the EU were given temporary dispensation to continue receiving Russian oil in December 2022 when the EU began to sanction russian oil supply into Europe. That temporary dispensation was offered to give the countries time to set up alternative, non-russian supply sources.

In the nearly three years since, Hungary has not attempted to arrange alternative suppliers - they have instead increased their dependence on Russian oil, and Orban has put Hungary at risk of Energy meltdown-down as the EU was always committed to cutting off Russia entirely.

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Next 👉 Hungary and Slovakia have abused the temporary dispensation given to them by the EU. Hungary and Slovakia used a sanctions carveout to keep pumping it in. Hungary has even ramped up Russian oil imports.

Only around 3% of Europe’s crude oil supplies now come from Russia, the EU claims, an alternative pipeline route through Croatia has sufficient spare capacity to meet the needs of both countries.

The argument comes at a time of increasing diplomatic tensions between Brussels and Budapest. Ukrainian is now blocking the transit of pipeline crude sold by Russia's largest private oil firm, Lukoil, effectively stripping the two countries of a third of their oil imports.

Szíjjártó from Hungary warned in an interview on Hungarian television station ATV last week that until the issue of oil transit is settled, Hungary would continue to block €6.5 billion in military aid to Ukraine through the European Peace Facility.

He claims that hat Lukoil currently accounts for one-third of Hungarian oil imports and around 45 per cent of Slovakian oil imports, making the Ukrainian ban a fundamental threat to the energy security of both countries.

‘This is an unacceptable and incomprehensible move by a country that wants to be a member of the European Union and that, with a single decision, puts the oil supply of two EU member states at fundamental risk,’ he said.

Slovakia and Hungary - two countries that have opposed western allies' military aid to Ukraine as it fights Russia's invasion - have complained to Brussels about Kyiv's move to put Lukoil on its sanctions list, saying it prevented them from buying Russian oil for their refineries, threatening security of supply.

Hungary and Slovakia have gone to the rule book, arguing the penalties violate a 2014 trade deal between Kyiv and the EU and asking the European Commission, the EU’s executive, to intervene.

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Next 👉 Remember Hungary ignoring the EU over their concerns of Hungary relaxing Russian visa entry into the EU?

OFAC implements new sanctions - 23 August 2024

Context:

Building on the sanctions already imposed on Russia in response to its continued war of aggression against Ukraine, today the U.S. Department of the Treasury and the Department of State targeted nearly 400 individuals and entities both in Russia and outside its borders—including in Asia, Europe, and the Middle East—whose products and services enable Russia to sustain its war effort and evade sanctions.

The United States government will continue to support Ukraine as it defends its independence and hold Russia accountable for its aggression.

“Russia has turned its economy into a tool in service of the Kremlin’s military industrial complex. Treasury’s actions today continue to implement the commitments made by President Biden and his G7 counterparts to disrupt Russia’s military-industrial base supply chains and payment channels,” said Deputy Secretary of the Treasury Wally Adeyemo.

“Companies, financial institutions, and governments around the world need to ensure they are not supporting Russia’s military-industrial supply chains.”

Treasury is targeting numerous transnational networks, including those involved in procuring ammunition and military materiel for Russia, facilitating sanctions evasion for Russian oligarchs through offshore trust and corporate formation services, evading sanctions imposed on Russia’s cyber actors, laundering gold for a sanctioned Russian gold company, and supporting Russia’s military-industrial base by procuring sensitive and critical items such as advanced machine tools and electronic components.

Today’s sanctions further limit Russia’s future revenue from metals and mining. Treasury is also targeting Russian financial technology companies that provide necessary software and IT solutions for Russia’s financial sector.

Treasury is aware of Russian efforts to facilitate sanctions evasion by opening new overseas branches and subsidiaries of Russian financial institutions.

Foreign regulators and financial institutions should be cautious about any dealings with overseas branches or subsidiaries of Russian financial institutions, including efforts to open new branches or subsidiaries of Russian financial institutions that are not themselves sanctioned. Treasury has a range of tools available to respond to the establishment of new evasion channels.

The State Department is targeting entities and individuals involved in Russia’s future energy, metals, and mining production and exports; sanctions evasion; Russia’s military-industrial base, including armed unmanned aerial vehicle (UAV) production, Belarusian support for Russia’s war effort, and air logistics entities; additional subsidiaries of State Atomic Energy Corporation Rosatom; and malign actors involved in the attempted, forcible “re-education” of Ukraine’s children.

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Next 👉 SANCTIONS EVASION, CIRCUMVENTION 🔐 SANCTIONS EVASION, CIRCUMVENTION, AND BACKFILL

Consistent with commitments made by President Biden and G7 leaders, Treasury continues to target transnational networks that supply Russia with military materiel and sensitive dual-use goods like those included in the multilateral Common High Priority List, jointly developed by the United States, European Union, Japan, and the United Kingdom.

Treasury is also targeting multiple networks that facilitate or enable illicit financial schemes and sanctions evasion on behalf of Russian revenue generators and oligarchs.

Many of today’s designations were enabled or informed by extensive coordination with Treasury’s Financial Crimes Enforcement Network (FinCEN). Today’s action targets almost a dozen distinct networks, designating more than 100 individuals and entities across 16 jurisdictions, including the People’s Republic of China, Switzerland, Türkiye, and the United Arab Emirates.

🔐 RUSSIA’S TECHNOLOGICAL BASE

Today, Treasury is targeting more than 60 Russia-based technology and defense companies that are critical for the sustainment and development of Russia’s defense industry, including entities involved in weapons development and modernization, automation and robotics, development and acquisition of dual-use electronics, digital surveillance, Internet of Things, and artificial intelligence.

These sanctions target Russia’s defense industry while protecting the access by Russian citizens to crucial telecommunications and other digital technology.

🔐 LIMITING RUSSIA’S STRATEGIC METALS AND MINING SECTOR

Guided by commitments made by President Biden and G7 leaders to reduce Russia’s revenues from metals, today Treasury is targeting entities involved in Russia’s metals and mining sector, including steel, iron, and coal mining firms and auxiliary firms that provide specialized services to Russian metals and mining companies.

🔐 RUSSIAN FINANCIAL TECHNOLOGY

Today, OFAC is targeting Russian financial technology companies as a part of implementing G7 commitments to curtail Russia’s use of and access to the international financial system to further its war against Ukraine.

👉 Atol is a Russian technology developer involved in services related to payments.

👉 Centre of Financial Technologies Group (CFT)is one of the largest software companies in the Russian market. CFT provides an array of software products for banking and payment solutions for the Russian financial market.

👉 Diasoft Ltd (Diasoft) is one of Russia’s largest developers and suppliers of information technology (IT) solutions for the financial sector.

Atol, CFT, and Diasoft were designated pursuant to E.O. 14024 for operating or having operated in the technology sector of the Russian Federation economy.

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Next 👉 Ammunition Procurement Network