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Thread: Trump helps Russia

  1. #1
    The Un-Holy One The Man's Avatar
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    Trump helps Russia

    With his Iran sanctions and such:



    U.S. President Donald Trumpís withdrawal from the Iran deal and his decision to reinstate sanctions on Tehran has been met with strong international criticism, including from Russia. But for Moscow, the U.S. president's decision also presents it with a rare economic opportunity.

    Moscowís support for Joint Comprehensive Plan of Action (JCPA) not only opens the door for communication and cooperation with the West, it gives the Kremlin international credibility in its elusive quest for international stature.

    The U.S. exit from the Iran deal affords Putin a lot more than being ďon the right side of history.Ē There is now a striking opportunity for Russia to bolster its strategic interests within the Iranian energy sphere.

    Iran is second behind Russia in global natural gas reserves and it holds the fourth largest reserves of global oil. In addition to its natural resource wealth, Iran is situated within crucial corridors for global energy trade.

    Given the superpower ambitions of Russiaís energy sector, it is not surprising that Iranís energy wealth and geographical position are of paramount interest to the Kremlin.

    Developing a strategic energy relationship with Tehran, shaped by majority stakes in projects across Iranís untapped natural gas fields and the planning of pipeline corridors from Iran to Syria and onward to Europe are central drivers for Russia.

    The U.S. Treasury has already hinted at when it will reinstate sanctions on Iranís energy industry. The first round is expected to hit Aug. 6. By Nov. 4, energy sector sanctions including the use of Iranian ports, engagement in commercial shipping, buying petrochemical and petroleum products, will be reinstated. (Those sanctions will come into effect after a 180-day grace period.)

    U.S. National Security Advisor John Bolton has also now confirmed that European energy firms engaged with Iran will be subjected to U.S. sanctions after this 180-day wind-down period.

    The following day, Nov. 5, U.S. entities will be blocked from engaging in financial transactions with Tehran.

    In 2016, after easing sanctions from the implementation of the JCPA, Iran flooded the global oil market. By December 2017, Iranian oil exports had jumped to 4 billion barrels per day (bpd). The Asia Pacific served as Tehranís key customer, importing 1.9 billion bpd. The Chinese and Indian markets imported the vast majority, with Taiwan, Malaysia, South Korea and Japan proving the import balance.

    By early 2018, Europe was importing up to 550,000 bpd, further accompanied by an array of bilateral energy deals, most of which were across the renewables sector.

    Efforts to rectify the global oil oversupply are ongoing, with OPEC recently agreeing to continue to stabilize oil production out to December 2018. The reinstatement of sanctions will sideline Iranian oil, and given basic supply-demand dynamics, this will drive oil prices upwards.

    Compounded by various other geopolitical drivers, including Venezuela, it is reasonable to expect an oil price of $80 by the end of 2018. At $80 per barrel, Arctic oil in the Barents Sea region, the bedrock of Russiaís future economic base, is commercially viable. North of $100 will likely bring much of the shelved offshore Arctic development back online.

    Prior to the 2016 agreement, sanctions upon Tehranís energy industry are estimated to have cost Iran $160 billion dollars in lost revenue. Keen to mitigate the impact of the return of US sanctions, Tehran will be looking for durable export markets. China and India are unlikely to adhere to any U.S. curtailment of Iranian oil imports.

    However, the significant South Korean and Japanese markets are expected to toe the U.S. sanction line and refrain from importing Iranian oil. In that case, Russia will position itself to fill the supply gap.

    In light of continued oil production challenges in the domestic energy sphere, including aging fields and the Kremlinís inability to invest in new production, it is probable that Russia will source oil for export from Iran. Russia will also capitalize on Tehranís economic peril, gaining the upper hand in commercial energy dealings.

    The existing $4 billion-dollar deal between Russiaís state-owned Zarubezhneft and Tehran has already been extended out for five years. Moscow is now in a stronger position to dictate the terms for which the remaining $26 billion dollarsí worth of Russian funds earmarked by Putin for investment in the Iranian energy sector is to be spent.

    Trumpís exit from the JCPA will inextricably exacerbate the insecurity dynamic in the Middle East for years to come if no alternative agreement is forthcoming. Of course, uncertainty in the Middle East never bodes well for oil prices.

    The fallout from Trumpís decision will be felt by the global oil market, once Iranian oil is removed, itís not unrealistic to expect the current oil oversupply to readjust swiftly and reignite supply concerns. Continued global oil demand will necessitate price rises and states will look to secure their energy imports at any cost.

    In the long term, this could bolster Asian interest in offshore Arctic oil and in search of energy security, see the Arctic region developed. Once more, Russia is positioned to gain from bolstered Asian interest in the promise of Arctic energy security.

    The U.S. exit from JCPA affords the Kremlin the ability to fill the supply demands of those nations who will be forced to turn away from Iranian oil. This also gives Putin a free pass to cement a deeper Russian stake in Iranís trajectory.

    In the short term, the Kremlin will gain a foothold in Iranís energy sphere, which is a future linchpin for international energy flows. In the long term, this will ultimately ensure Russia greater access to and control of, the global oil and gas network. Putin will seize this opportunity to bolster, perhaps even legitimize, Russia's Middle East presence and further isolate Trump.
    The Crumbling Iran Deal Could Make Russia Rich (Op-ed)

    lol You'd almost think Trump is deliberately doing Putin's bidding...
    Thanks from CEngelbrecht and BigLeRoy

  2. #2
    Thought Provocateur NightSwimmer's Avatar
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    Quote Originally Posted by The Man View Post
    lol You'd almost think Trump is deliberately doing Putin's bidding...

    Surely, he's clever enough to be getting a kickback.
    Thanks from The Man

  3. #3
    The Un-Holy One The Man's Avatar
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    Quote Originally Posted by NightSwimmer View Post
    Surely, he's clever enough to be getting a kickback.
    One would hope so, for his sake...

  4. #4
    Thought Provocateur NightSwimmer's Avatar
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    Quote Originally Posted by The Man View Post
    One would hope so, for his sake...

    Prolly loan forgiveness. That doesn't necessarily involve a paper trail. They wouldn't even have to launder any money.
    Thanks from The Man and Idiocracat

  5. #5
    Radical Centrist BigLeRoy's Avatar
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    Quote Originally Posted by The Man View Post
    With his Iran sanctions and such:



    The Crumbling Iran Deal Could Make Russia Rich (Op-ed)

    lol You'd almost think Trump is deliberately doing Putin's bidding...
    I don't 'almost' think that. I DO think that.
    Thanks from The Man and Idiocracat

  6. #6
    the "good" prag pragmatic's Avatar
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    Quote Originally Posted by The Man View Post
    With his Iran sanctions and such:



    The Crumbling Iran Deal Could Make Russia Rich (Op-ed)

    lol You'd almost think Trump is deliberately doing Putin's bidding...

    So is the premise of the post/thread that Trump's Iran action was for the purpose of helping out Putin?

  7. #7
    Radical Centrist BigLeRoy's Avatar
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    Quote Originally Posted by pragmatic View Post
    So is the premise of the post/thread that Trump's Iran action was for the purpose of helping out Putin?
    Certainly Putin LOVES the higher oil prices that are resulting from Trump's torpedoing of the deal. You DO realize just how dependent the Russian economy is on fossil fuel exports, yes?
    Thanks from The Man

  8. #8
    The Un-Holy One The Man's Avatar
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    Quote Originally Posted by pragmatic View Post
    So is the premise of the post/thread that Trump's Iran action was for the purpose of helping out Putin?
    Well, it is certainly benefiting Russia in a number of ways, as explained in that article. Could be a pure coincidence, of course. Or not
    Thanks from BigLeRoy

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