For Europe, the merits of sanctioning Russian energy were always questionable. After all, cheap energy is essential to the running of the economy, and Russia was Europe’s single biggest source. Not only that, but alternative sources – like Saudi Arabia – are not obviously more ‘moral’ than Russia. (The Saudis have been bombing Yemen for the last seven years.)
However, Europe went ahead with sanctions, and since February there has been a dramatic decline in Russian oil imports. Where do things stand now?
Inflation in the EU is running at 9% – the highest on record. And while this trend began before Russia’s invasion of Ukraine, it has certainly been exacerbated by sanctions. As the Economist notes, the “root cause” of Europe’s inflation is “a severe energy-price shock”. In Britain, where inflation is about equal to the European average, there are already warnings of possible blackouts this winter.
Meanwhile, Russia’s oil revenues have actually risen. This is mainly due to the rising price of oil, which has more than offset lower export volumes. In addition, Russia has easily found alternative buyers for its energy – notably India and China. So not only are sanctions hurting Europe, they’re actually helping the West’s main geopolitical rival – which gets a discount on each barrel of oil it imports.
In an interview back in May, EU Commission President Ursula Von Der Leyen explained precisely how energy sanctions could end up backfiring. If we “immediately” cut off the oil, she said, Putin “would be able to take the oil that he does not sell to the European Union to the world market, where the prices will increase, and sell it for more”. Strangely, Von Der Leyen seems to have ignored her own advice.
And if you thought that was ironic, India has been importing crude oil from Russia, refining it, and then re-exporting it to Europe at a profit. Which means Europe is still ‘funding Putin war’s machine’ – only now it’s paying a fee for the privilege of doing so.
As Phil Pilkington notes, the rhetoric around sanctions “has completely stopped making even internal logical sense”. On Thursday, Russia began reducing gas supplies to Europe (presumably in response to Macron, Scholz and Draghi meeting Zelensky in Kiev). This prompted complaints from European leaders – the same leaders who claim they want to stop ‘funding Putin’s war machine’.
When you impose sanctions on a country, you’re supposed to be glad you’re not receiving its exports – that means the sanctions are working. The truth is that Europe needs Russian gas as much as Russia needs hard currency.
At this point, however, I can’t imagine Europe backtracking on sanctions: doing so would be too humiliating. Hence energy prices are likely to remain high, and a major recession may be just around the corner.
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Has anyone considered the very real possibility that Ed Milliband is ill? that he has some form of clinical insanity? it would go a long way to understanding the sheer absurd lengths to which he is going in order to stop us using fossil fuels. Why pour cement down a fracking well to block it up, to prevent it ever being used? when the law has put in place sufficient restrictions for it ever taking place in this parliament and without a reversing of the law. He is surely doing the equivalent of a Crusader smashing, destroying and removal of all buildings effigys, and people who practised a different religion in order to wipe any chance of it continuing in the future.
I do believe he needs to be examined as he is clearly obsessed in a very dangerous way and is as a result a danger to humanity.
Concreting over wells is simply Scorched Earth Policy and is actually preposterous. We are governed by ideologues that will stop at nothing to get their own way and as a result we now have electricity prices 3-4 times higher than in the USA, where they continue to use fossil fuels for the benefit of the citizens, and it is only going to get worse in the UK and all countries pandering to the UN/WEF pretend to save the planet eco socialist fraud.
He’s concreting the fracking wells to prevent any future government reversing his decisions. To restart a dormant well you need a lot less investment than drilling a new one – so at a stroke he has made any future decision to frack for gas more expensive than it need be.
However, it is quite possible to drill new wells and the gas will still be there for future generations when the lunacy abates. The current government’s attempt to constrain future governments decisions will fail.
If he’s I’ll then the whole world’s political establishment is. Reference the earlier article on the impact of the sun, you’d have thought any uncorrupted politician would suggest checking it out before wasting £trillions on stuff of doubtful utility.
Mental condition: narcissism, psychopath.
I think the only solution is a straight jacket and a padded cell
Rope is cheaper, and hempen rope is “sustainable”.
Yes, i’ve thought that for some time
It costs money to do that and concrete is not CO2 friendly. This is about trashing capitalism – the goal of the green movement since communism failed.
Wind is cheaper than gas —–TRUE. As a fuel wind is free and gas is not free. You need to bring it from the ground and that costs money. But harnessing the wind is not free, and the wind needs the gas powered plants ticking over waiting for the wind to stop, which is often and many times unexpectedly, often at times of greatest need etc. So anyone who says “wind is cheaper than gas” is deliberately only telling you part of a story. Then we have the situation where the more wind you have the less reliable the grid, the more backup you need all costing more and more money, and as we reach beyond the reserve margin, storage will be required to avoid blackouts. This storage which is not yet developed except pumped hydro is very expensive, often costing 10 to 20 times more than the actual energy it is supposed to be backing up. As a result we have spiralling costs, destruction of the economy that depends on low energy costs, and a country totally covered in thousands of turbines, solar panels and thousands of new pylons to take the renewable energy to the grid. This is total absurdity. There is no need for this mad rush to Net Zero in such a short time frame, all because of the madness of the global warming groupthink politics which is lying to the UK citizens that there is a climate crisis and that we in this country must be world leaders in fixing it.———-Then after all of this nonsense about wind being free or cheaper than gas, our government then ties the price of wind to the price of gas so that we never get any benefit from the “FREE WIND”. —-It is outrageous eco politics that is taking people for a ride, and I would go so far as to say it is the greatest pseudo-scientific fraud ever perpetrated.
“Wind is cheaper than gas” is an utterly meaningless statement, intended to mislead.
Indeed.
No resource has any value in its natural state. The value comes when it is put to beneficial use, and its cost is the capital required to do so. If the cost input exceeds the output value, then that is a loss. The cost input to provide electricity from wind and solar exceeds the value of output, because of the intermittency cost – the indirect cost of alternative generation to provide power when wind/solar cannot, and to stabilise the grid.
And… a resource does not exist until Mankind invents it by finding a beneficial use for it. Iron ore, oil, coal were not “resources” in the Stone Age, for example.
The Earth has no resources, only Mankind has resources.
All pretty obvious- though you have put it very succinctly. Sadly I suspect many don’t grasp it, such is the degree of economic illiteracy. Should be compulsory in every school.
And it’s used that way constantly by the MSM. You only have to read the comments sections on any MSM article on energy costs, to see 90% of people believe wind turbines and solar are ‘free / low cost’… I’d say less than 10% of posters actually understand the real cost, once intermittency and subsidies are taken into account. Whether most people think the electricity is simply waiting for them, behind their sockets or something, I don’t know. In a way it’s perhaps a reflection of the historic level of reliability of the British national grid has enjoyed, which Millibrain is slowly destroying
Yes – see my reply to JXB.
Yes but because it is actually true that the wind is cheaper than gas as a FUEL, it allows the charlatans to mislead the public.
“Worker mobility is an issue rarely considered by politicians, who often view themselves as citizens of anywhere…”
…Likewise in a corporate past life, the new C.E.O. with family based on another continent from a previous C.O.O. position, opting to boost the share price (and annual bonus) by moving the whole caboodle on a whim from one side of a country to the other, in order to access “a world-leading corporate ecosystem.”
No evidence-base whatsoever cited for putting thousands of working and family lives through the mangle and splashing a corporate billion on a vanity project.
As for Kommissar Miliband, someone please send for straightjacket, largactil and 50 ml syringe.
We’re a smallish firm – about 60 people. I guess some of them are easily fungible but most are not. If your people are not important to your business then you might not have the right people. When we moved offices we were at pains to ensure it was very near the old one so as not to discombobulate the staff.
Could he not have had the head band of the hat adjusted for him? Or does he believe he has a brain the size of a planet? Or perhaps some PR person was having a laugh?
Command & control economy because we are back to Marxist-Socialist Labour revealing its true colours.
Jobs are a cost. If more jobs are being created than currently required to produce the same or lower output, this is a loss to the economy = makes us poorer.
If these jobs are created by subsidies using taxpayer cash = reduces economic activity = makes us all poorer.
It is why free market capitalism regulated by supply, demand, prices, innovation and technological advance together with consumer choices = prosperity. Exhibit A: Industrial Revolution. For the alternative: USSR.
Indeed we are. But the Conservatives are as committed to net zero as Labour. In fact, THE CONSERVATIVES SET THE NET ZERO BY 2050 TARGET. Not Labour.
Labour pushed through the Climate Change Act, but with the target of an 80% reduction. The Conservatives upped the target to 100%, or net zero.
The Conservatives remain committed to the 2050 net zero target. It is still their official party policy. Don’t be fooled by occasional sceptical comments from them that fall short of committing to a change in policy.
Is there a single ‘green’ technology that has proved beneficial? Answers on a postage stamp.
Great – let’s get all the workers to sell their houses to move to the jobs and be made poorer by the costs of moving, of buying and selling a house and oh yes, have thousands of pounds stolen from you by the state in a tax known as stamp duty.
And a good day for this article as our ignorant scrounger of a PM Two Tier No Idea Kier is spouting lies at the energy security jamboree in London before he goes off to a lovefest with global fascist Usually Fond Of Lying. If we had a functional opposition we could expect a rebuff of all of his lies but not with Olukemi Adegoke or of course the great Messiah who is too busy moving his company into the centre-left Uniparty ground as he proposes all the immigrants can stay under an amnesty.
Does anyone else worry that Milliband and Labour are deliberately trashing the country? It is the sort of thing I heard Marxists fanntasizing about when I was back at university a couple of years ago.
Worry? That’s clearly what they are doing imo… question is, how can we stop and reverse it?
Never forget that Mad Miliband is fully supported by the Mad Monarch of Windsor.