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Ukraine Won't Pay Russia For Gas, Has Billions In Obligations Due; Europe Promises Aid Money It Doesn't Have

Tyler Durden's picture


About an hour ago, the head of Russia's top natural gas producer Gazprom said on Wednesday that Ukraine had informed the company it could not pay for February gas deliveries in full, further adding to tensions between Moscow and Kiev. Alexei Miller said Ukraine's total debt to Gazprom for gas deliveries was nearing $2 billion. "Our Ukrainian colleagues informed us that they would not be able to pay in full for February gas deliveries," he told Russian President Vladimir Putin.

As reported by Reuters, Miller added that Ukraine managed to redeem only $10 million on Wednesday from a total debt of $1.529 billion. He said that Ukraine's debt would rise by $440 million on March 7, a deadline for payments. In other words, as of this moment the Ukraine already owes Russia $2 billion, or about double what John Kerry announced to much fanfare, the US would provide the country with in terms of aid. And considering that yesterday Gazprom announed that beginning in April it would end the gas pricing discount to the Ukraine, which lowered the price of gas to $268.5 per 1,000 cubic metres from around $400, this accrual is only set to get bigger with every passing day, and very soon Ukraine may get no Russian gas at all which was and continues to be the biggest leverage Russia has over the country which nuclear power plants provide less than half of its electricity needs.

As a reminder, and as we have pointed out since the start of the Ukraine conflict, Gazprom, which meets 30 percent of Europe's gas demand, shipped 86 billion cubic meters, or over half of its total exports, to the European Union through Ukraine last year. Gazprom already warned Europe may see "fluctuations" in its gas delivieries from Russia.

A Gazprom spokesman said Russian gas transit to Europe via Ukraine was flowing normally. For now.

But gas is only the beginning of Ukraine's problems. As also announced about an hour ago, Ukraine's acting finance minister Oleksander Shlapak reported that the country needs to repay $10 billion by year end and that the country may ask for a debt restructuring. Naturally, absent outside help, no repayment is possible and the country will certainly default, which means someone has to step up and bail out the Ukraine. The only question is where this aid comes from: EU/IMF or Russia.

And that is the €/$64K question. Which is why also earlier today, the European Commission announced that it will provide Ukraine with 11 billion euros ($15 billion) in financial assistance to Ukraine.  As reported by RIA, European Commission President Jose Manuel Barroso said the aid package was designed to enable “a committed, inclusive and reforms-oriented government in rebuilding a stable and prosperous future for Ukraine.” The European Commission said in a statement that financial support would be provided over a two-year period from the EU budget and EU-based international financial institutions.

There is only one problem with Europe's aid:  the money is not only not "there," it is also conditional on individual countries getting approval from their populations, and most of it would come from the IMF, i.e. funded primarily by US taxpayers. As the WSJ summarized, "The EU said it would make at least $15 billion in grants and loans available for Ukraine in the next couple of years, although much of the money has strings attached and would need approval from member states and other institutions."

So basically, it comes down to a matter of timing and payment acceleration: if Russia really wants Ukraine to fold, it will make sure the bill is high enough and the gas shut off looming enough that the only source of funds would be Russia itself, not insolvent Europe. The last thing Putin will want is to give Europe the years it needs to figure out how to honor its bailout commitment (ask Greece). Which is why Medvedev has also announced Russia would be able to provide $2-3 billion immediately to Ukraine... to pay for the gas bill. Naturally, with a few strings attached.


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Wed, 03/05/2014 - 09:07 | 4511127 magpie
magpie's picture

Doesn't matter...US will start defaulting by CUSIP later this afternoon.

Wed, 03/05/2014 - 09:14 | 4511139 FreeSlave
FreeSlave's picture

Kiev snipers hired (possibly) by Maidan leaders - leaked EU's Ashton phone tape and on youtube:

Wed, 03/05/2014 - 09:15 | 4511146 Tracerfan
Tracerfan's picture

If this can be proven, the Kiev regime will collapse.

Wed, 03/05/2014 - 09:21 | 4511161 Rakshas
Rakshas's picture

isn't this the same play book the US NGO's used in Venezuela and Syria and can be verified by  ballistics i would think....... imagine if you  would an international community that cared about truth and justice so much that they put the same effort into getting to the bottom of a crime against humanity as they do in convicting a black man in the US of smoking a joint....... yeah i think I should be smoking a joint to even say something so silly as that.... 

Wed, 03/05/2014 - 09:25 | 4511169 TheFourthStooge-ing
TheFourthStooge-ing's picture

Sorry, but truth and justice are prohibited by law.

Wed, 03/05/2014 - 09:48 | 4511222 i-dog
i-dog's picture

If I told my energy supplier that I couldn't pay my February bill, I'm not sure I'd receive much energy in March.

Perhaps I should become Too Big To Pay.

Wed, 03/05/2014 - 10:03 | 4511271 Oldwood
Oldwood's picture

Or, how many different ways can you say...default?

Wed, 03/05/2014 - 10:26 | 4511355 BobPaulson
BobPaulson's picture

Zoom the camera out a bit. Cutting off people's gas only makes you money if you have alternate customers. This market is not like selling potatoes in the city square. The Saudis will tell you, when you restrict supply in a market with few suppliers and customers that big,  you don't always win. In addition, gas is a bit like electricity in that it is difficult to switch buyers due to the infrastructure needed to deliver the product.

Wed, 03/05/2014 - 11:01 | 4511540 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Yep and now you know why Syria is so key in this and why the Russians are determined to keep Middle East gas out of the Nabucco from the south. The Russians in this can restrict supply and the EU will be forced to foot the Ukrainian bill to keep their gas flowing. You got a bunch a Neo Nazi NATO attack dog assets running the place who feel entitled to NATO's help and monetary support for their labor working as mercenaries for NATO through the usual mercenary army for hire types like Britam going back to the 90s in nthe Balkans and more recently in Chechnya alongside the Muslims there against the Russians. Even if they had the money they ain't going to pay the bill anyways since NATO owes them now...

Wed, 03/05/2014 - 12:56 | 4512210 CrashisOptimistic
CrashisOptimistic's picture

You are thinking non scarcity thoughts.

If you just realign your rationale to one of scarcity, different conclusions are reached.

If you have a customer who is not paying you for nat gas and you want to cut them off, but don't think you will find another customer -- this is not a negative.  The reason it is not negative is you retain the scarce resource for your own future use.

And nat gas IS electricity.  It's not just about heating.  44% of Ukraine electricity comes from natgas.

Wed, 03/05/2014 - 16:42 | 4513334 Urban Redneck
Urban Redneck's picture

Read my post on the math, look at the picture, and do your own math, the functions are rather simple, and not what the MAD warmongers makes them out to be.

Wed, 03/05/2014 - 09:25 | 4511170 johnQpublic
johnQpublic's picture

truth and justice



Wed, 03/05/2014 - 09:25 | 4511173 negative rates
negative rates's picture

This won't end well, you know you can make things worse by trying to make them better, who idea was it to send him over there in the first place?

Wed, 03/05/2014 - 10:28 | 4511364 Tracerfan
Tracerfan's picture

The leaders of Euromaidan hired the snipers who fired on protesters and police in Kiev, according to a leaked phone conversation between Estonian Foreign Minister Urmas Paet and EU foreign affairs chief Catherine Ashton, RT reported March 5. Paet said he spoke with a doctor who had treated sniper victims in Kiev and was told that the same gunmen shot both protesters and police.

Wed, 03/05/2014 - 09:48 | 4511236 PontifexMaximus
PontifexMaximus's picture

I'm only waiting til they blame the muslim minority of the Krim tartars

Wed, 03/05/2014 - 09:49 | 4511238 ArgentDawn
ArgentDawn's picture

Of course RT would say that

Wed, 03/05/2014 - 10:58 | 4511523 Who Laughed
Who Laughed's picture

*and at least one member of an EU govt.

Wed, 03/05/2014 - 10:12 | 4511306 Bindar Dundat
Bindar Dundat's picture

I just listened tonthis tape and it sounds authentic.  The question becomes who leaked it and why?

Wed, 03/05/2014 - 10:51 | 4511462 pods
pods's picture

The story said the phones were hacked.

Not quite sure what type of phone records conversations, but that is fishy. I doubt in the middle of this kind of crisis that Ukraine would be able to do that.

Now, Russia is another story.


Wed, 03/05/2014 - 10:57 | 4511506 TheReplacement
TheReplacement's picture

I've been waiting for proof of that conspiracy and I guess I still wait.  A doctor's examination of the wounds isn't convincing.  Both sides would be using the same firearms (AKs). 

What I have seen is video of the police holding AKs AND shooting at eye level toward targets that were not visible in the frame.  This is much more believable.

Oh well, keep looking.

Wed, 03/05/2014 - 10:57 | 4511507 Spumoni
Spumoni's picture

I'm tellin' ya, Ukraine, sell your pot to Colorado and washington. You won't need bailouts! You'll have friends in high places (snicker)!

Wed, 03/05/2014 - 09:08 | 4511128 dcj98gst
dcj98gst's picture

They should just default and be done with it.  Why pay the bankers?

Wed, 03/05/2014 - 09:15 | 4511142 GetZeeGold
GetZeeGold's picture



All wars are bankers' wars.....including this one.


I'm getting excited.....almost half a million hits....that's a lot of useful idiots pulled out of the fire.

Wed, 03/05/2014 - 11:14 | 4511619 Pesky Labrador
Pesky Labrador's picture

Facebook blocked that url link, bastards!

Wed, 03/05/2014 - 09:44 | 4511226 krispkritter
krispkritter's picture

 "If we could just make some'll take a check?  Why heck, why didin't you say so?  I thought you needed money. Hell, let's just pay the whole thing off right now..." A la Jeff Foxworthy  Financial Rope-a-dope.  Screw the IMF and Brussels

Wed, 03/05/2014 - 11:04 | 4511561 TheReplacement
TheReplacement's picture

Because the article says that someone HAS to bail them out.  It has to be done or the world will end.

Wed, 03/05/2014 - 09:08 | 4511130 Harry Dong
Harry Dong's picture

Sell some more farmland to China. Yeah, that's a good idea.

Wed, 03/05/2014 - 09:26 | 4511177 johnQpublic
johnQpublic's picture

fuck growing food

all that grain was giving them gas




Wed, 03/05/2014 - 09:08 | 4511131 Dorelei
Dorelei's picture

Let's send all the gold bugs flocking by millions over there  ! Don't they love their neighboors after all  ???

As for me , I'm king Midas and come daily here to take  my golden dump so I can pay the bill any time !!

Wed, 03/05/2014 - 09:23 | 4511166 GetZeeGold
GetZeeGold's picture



How ya doing king?

Wed, 03/05/2014 - 09:34 | 4511193 SoilMyselfRotten
SoilMyselfRotten's picture

Find a toilet and spare the rest of us

Wed, 03/05/2014 - 09:09 | 4511132 Undecided
Undecided's picture

Scotiabank one of 5 banks facing lawsuit over accusations of gold price manipulation
Wed, 03/05/2014 - 09:16 | 4511148 GetZeeGold
GetZeeGold's picture



Hang them high......then do it again.

Wed, 03/05/2014 - 09:41 | 4511214 LawsofPhysics
LawsofPhysics's picture

Correct, nothing changes otherwise. 

Wed, 03/05/2014 - 09:10 | 4511135 Josephine29
Josephine29's picture

This of course adds to the pre-exising problems of the economy of the Ukraine as discussed below..

We can feed this into the latest bulletin from the National Bank of the Ukraine which had a background of economic growth being -1.3% as of September 2013. Also industrial production in the year to November was 95% of what it has been in 2012.

It seems to be going from bad to worse....

Wed, 03/05/2014 - 09:15 | 4511138 tony wilson
tony wilson's picture


cant pay wonte pays

We are the 1%! Kiev gives oligarchs top jobs

6 of these gentle folks have dual ukraine and israeli passports

the rothschild soros squad

funny old khazar world

Wed, 03/05/2014 - 12:06 | 4511937 Kirk2NCC1701
Kirk2NCC1701's picture

I don't doubt it.  +1 for investigative journalism.  But the more telling and pertinent trend is this:  Note the people from which countries and cultures who have climbed the fastest on the American totem-pole (economically and politically).

Jews and Asians (Chinese, Indian, Japanese, Korean). 

For $500 name the common denominator for these cultures, compared to the traditional European cultures in America? 

A:  ???  (Hint: To help you overcome your cultural blind-spot, think of what they are NOT.)

Wed, 03/05/2014 - 09:15 | 4511145 Element
Element's picture

2 billion bucks of gas, extracted and pumped then used ... and not payed for ... that would seriously piss me off.

They sure as hell would not be getting any more.


Wed, 03/05/2014 - 09:54 | 4511254 thecoloredsky
thecoloredsky's picture

what about payment in gold?

Wed, 03/05/2014 - 09:58 | 4511259 semperfi
semperfi's picture

somebody's gonna have to go back and get a shitload of (gold) dimes !

Wed, 03/05/2014 - 10:02 | 4511270 Clever Name
Clever Name's picture

Yes! German gold! It will take about 7 years...

Wed, 03/05/2014 - 10:16 | 4511312 Element
Element's picture

I have a feeling it's going to be paid in real-politic.

Wed, 03/05/2014 - 10:17 | 4511321 adonisdemilo
adonisdemilo's picture

Sorry, already earmarked by the IMF

Wed, 03/05/2014 - 10:57 | 4511509 semperfi
semperfi's picture

or bitcoin, fonestar's - he has a big stash, right old boy ?

Wed, 03/05/2014 - 11:13 | 4511614 SilverRhino
SilverRhino's picture

It will be paid for in land.    All those Russian speaking parts of the Ukraine? ... say hello to East Ukraine.   


Wed, 03/05/2014 - 11:00 | 4511538 Spumoni
Spumoni's picture

Maybe they ought to consult with the Nigerians on pirating pipelines...

Wed, 03/05/2014 - 12:23 | 4512033 Kirk2NCC1701
Kirk2NCC1701's picture

"They sure as hell would not be getting any more."

And HOW are you going to supply the EU when you cut them off? 

So far, the smartest suggestions I've seen are those that have the Russians asking to be paid in Gold.  Sorry fonestar, sorry Yellen.

Wed, 03/05/2014 - 09:16 | 4511147 jovius
jovius's picture


The snipers who shot at protesters and police in Kiev were allegedly hired by Maidan leaders, according to a leaked phone conversation between the EU foreign affairs chief Catherine Ashton and Estonian foreign affairs minister, which has emerged online.


“There is now stronger and stronger understanding that behind the snipers, it was not Yanukovich, but it was somebody from the new coalition,” Paet said during the conversation.

“I think we do want to investigate. I mean, I didn’t pick that up, that’s interesting. Gosh,” Ashton answered.


Game on now then.

Wed, 03/05/2014 - 09:30 | 4511183 agent default
agent default's picture

By investigate she meant we will find a way to cover this up.  At least fudge the issue, find ways to discredit the sources. 

Wed, 03/05/2014 - 09:31 | 4511187 jovius
jovius's picture

I especially like the understatement of 'Gosh'.

Wed, 03/05/2014 - 09:37 | 4511201 Element
Element's picture

"Gosh", roughly translated, is euro-aunty for, "Oh shit, they're on to us!"

Wed, 03/05/2014 - 09:40 | 4511211 GetZeeGold
GetZeeGold's picture



Golly geez!

Wed, 03/05/2014 - 10:17 | 4511322 Hubbs
Hubbs's picture

We need Gomer Pyle to really say it right! "Shazam shazam shazam!"

Wed, 03/05/2014 - 09:16 | 4511150 Taint Boil
Taint Boil's picture



Snicker, snicker …. Don’t have the money - can’t pay. Borrow the money to pay but now can’t pay back the lender ….. seriously, no matter how you look at it or how you spin it - it’ll never work. At what point does the world accept that all, everything, is a Ponzi and it can never be paid back

Wed, 03/05/2014 - 09:26 | 4511174 youngman
youngman's picture

When you just print it and do not have to EARN it its easy....but everyday that piece of paper you earned  just becomes one of trillions....and soon it is just a piece of paper

Wed, 03/05/2014 - 09:29 | 4511181 negative rates
negative rates's picture

Glad i kept both my gold timex watches. Worth a mint today.

Wed, 03/05/2014 - 13:07 | 4512251 CrashisOptimistic
CrashisOptimistic's picture

People can't embrace the reality that the horror of QE is that it has revealed that money means nothing.

It's imaginary.  It is created at a whim.  There is no such thing as Ponzi.  There is no such thing as financial fraud.  It is not food with calories.  It is not oil with joules.  It is nothing.  In all forms, nothing.  It was created by man.  It is not real.  And sorry gold nazis, that includes gold.  Its value exists only in the imagination of two parties in a transaction.

Contrast this with calories in crops.  Complete independence of what anyone "thinks".  Or joules in oil.  They are immune to thought.  They exist.  They are real.

Wed, 03/05/2014 - 09:28 | 4511179 negative rates
negative rates's picture

Later than sooner.

Wed, 03/05/2014 - 09:18 | 4511152 NoDebt
NoDebt's picture

More debt?  Throw it on the heap and spin up the presses.

Wed, 03/05/2014 - 09:18 | 4511153 the not so migh...
the not so mighty maximiza's picture

Dual citizen leaders are slackers and deadbeats

Wed, 03/05/2014 - 09:19 | 4511154 Dubaibanker
Dubaibanker's picture

At least, Putin might get a prize, which he deserves for preventing the Iran and Syrian fiascos from worsening.

Wed, 03/05/2014 - 09:40 | 4511209 Winston Churchill
Winston Churchill's picture

Extra borscht on your Nobel pizza prize Vlad ?

Wed, 03/05/2014 - 09:56 | 4511255 semperfi
semperfi's picture

It still feels weird to respect & admire Putin more than Obama, Kerry, Holder, etc.

Wed, 03/05/2014 - 12:30 | 4512073 Debt Slave
Debt Slave's picture

It is amazing that more people don't.

Wed, 03/05/2014 - 13:10 | 4512264 CrashisOptimistic
CrashisOptimistic's picture

Putin's prize will now be Iranian oil, which he will no longer make any pretense about restricting from his own pipelines for sale to Europe, forcing them to essentially undo their own sanctions.  He will mix it with Russian oil, sell it, take a commission, and give money to Iran -- who will then lose what little interest they have in negotiations.

Wed, 03/05/2014 - 09:19 | 4511155 spellbound
spellbound's picture

Well, we have Obomber phones...why not give them Obomber gas?!?!?!?

Wed, 03/05/2014 - 09:20 | 4511157 tom a taxpayer
tom a taxpayer's picture

Hold on to your dentures!  John Kerry's gumboat diplomacy will come to the rescue.

Wed, 03/05/2014 - 09:20 | 4511159 Whoa Dammit
Whoa Dammit's picture

Don't bite the hand that heats ya. (or that runs your lights & cars).

Wed, 03/05/2014 - 09:21 | 4511162 Catullus
Catullus's picture

Demand payment of gas debt in gold.

Wed, 03/05/2014 - 09:50 | 4511215 GetZeeGold
GetZeeGold's picture



I'm sure Germany wouldn't mind lending them some.

Wed, 03/05/2014 - 09:44 | 4511216 GetZeeGold
GetZeeGold's picture



I swear....I just hit it once.


Since I'm here....maybe Germany could just tell the Fed to ship it direct and cut out the middleman.

Wed, 03/05/2014 - 13:12 | 4512276 CrashisOptimistic
CrashisOptimistic's picture

Gold has no importance to society.

But the point of refusing paper for gas or oil is a powerful one.  Note how Germany handled this with France when they surrendered.  Francs?  No.  Gold?  No.

Crops.  Slave labor.  Things that are real and not based on the imagination of people.

Wed, 03/05/2014 - 09:22 | 4511163 tony wilson
tony wilson's picture


Bill Clinton and Hillary Clinton, the former and wannabe presidents of the US, say they have accepted more than $13 million from Ukrainian pipemaker Victor Pinchuk since 2006. But Pinchuk’s records show that he’s given the Clinton Foundation only $7.6 million.



As Pro-European Protests Seize Ukraine, Jewish Oligarch Victor Pinchuk Is a Bridge to the West

One breezy evening last September, Viktor Pinchuk, Ukraine’s second-richest man, stepped onstage at the Livadia Palace in the Black Sea resort of Yalta to introduce the star speaker of the annual international conference he hosts to promote his country’s ties with the West: former Secretary of State Hillary Clinton. Nearby, at a table set for an exquisite five-course meal, sat her husband; they were joined in the hall by Shimon Peres and Tony Blair, as well as a number of former European heads of state, top diplomats, and business tycoons. “Mr. President, you are really a super star,” Pinchuk told Bill Clinton in a seemingly apologetic tone, “but Secretary Clinton, she is a real, real mega star.”

Wed, 03/05/2014 - 12:16 | 4512010 Freddie
Freddie's picture

Clintons, Obama, McCain, Democrats and RINOs all controlled by the NWO, the oligarcahs and Soros.   In the Ukraine they just overthrow country and shoot people in the back.  

Forget about any US elections because they rig those.   The RINOs will win any primary challengers by Tea Party people or conservatives.

Wed, 03/05/2014 - 09:22 | 4511164 TheFourthStooge-ing
TheFourthStooge-ing's picture


The only question is where this aid comes from: EU/IMF or Russia.

No question there. The US and EU orchestrated the overthrow of the Ukrainian government after it decided to pass on joining up with them and instead chose to accept a better deal from the Russians. The new Ukrainian "government" and its US and EU backers now have what they wanted. They can pay for it.

And that is the €/$64K question. Which is why also earlier today, the European Commission announced that it will provide Ukraine with 11 billion euros ($15 billion) in financial assistance to Ukraine.

Correct me if I'm wrong, but isn't that about the same amount included in the deal with the Russians, along with discounts on gas, that the Ukrainian government was forcibly prevented from accepting?

Wed, 03/05/2014 - 09:34 | 4511192 Element
Element's picture

As I remember there was a certain $38 billion required, as of last week.

What happened, did it shrink in the laundering again?

Wed, 03/05/2014 - 10:22 | 4511336 TheFourthStooge-ing
TheFourthStooge-ing's picture


What happened, did it shrink in the laundering again?

It always does.

Wed, 03/05/2014 - 09:29 | 4511172 JustObserving
JustObserving's picture
Kiev snipers hired by Maidan leaders - leaked EU's Ashton phone tape

The snipers who shot at protesters and police in Kiev were allegedly hired by Maidan leaders, according to a leaked phone conversation between the EU foreign affairs chief Catherine Ashton and Estonian foreign affairs minister, which has emerged online.


Sorry, already posted above.  Somehow missed it.

Wed, 03/05/2014 - 10:07 | 4511284 Zwelgje
Zwelgje's picture

this needs repeating. 

Wed, 03/05/2014 - 10:48 | 4511439 forwardho
forwardho's picture

The source of that post is RT.

RT, as in Russian news.

Not saying yea or nay, only that propaganda is used by ALL sides. Always consider the source and what they may have to gain from acceptance of "News" as "Truth"

Wed, 03/05/2014 - 09:26 | 4511175 e_u_r_o
e_u_r_o's picture

thats why they will take krim as payment, seems fair to me

Wed, 03/05/2014 - 09:32 | 4511188 LawsofPhysics
LawsofPhysics's picture

Tired old lies is one thing, not being able to pay is another.

If you want your bankrupt states, you can keep them, we will keep the fucking oil bitchez...

Wed, 03/05/2014 - 09:42 | 4511218 buzzsaw99
buzzsaw99's picture

I'm sure the PIIGS and Detroit will be happy to see Ukraine get $10B us for free. [/sarc.]

Wed, 03/05/2014 - 12:24 | 4512046 Debt Slave
Debt Slave's picture

Might as well build a $10B pile out of $100 notes, spray it with gasoline, and throw a lit match on it.

Wed, 03/05/2014 - 09:49 | 4511237 BlackVoid
BlackVoid's picture

No problem, the US will export shale gas to Ukraine at US prices. ;)

Wed, 03/05/2014 - 13:16 | 4512293 CrashisOptimistic
CrashisOptimistic's picture

You do realize the US is a net importer of natural gas?

Wed, 03/05/2014 - 09:51 | 4511242 yt75
yt75's picture




The reality of today's world summarized :

Oil situation :
Leading to :

In other words current crisis is primarily a monstruous oil shock, and only the beginning.

Reminder :
Contrary to the legend on the above graph (barrel price), the first oil shock was much more the direct consequence of US 1970 oil production peak :
Associated to the rebalance of barrels revenues between majors and countries, and dropping of B Woods in 71 and associated $ devaluation.
The "embargo" an epiphenomenon, very limited, lasted 3 months, but pratical to hide US peak and "put the blame" on the Arabs.

Geopolitical summary :



Note : a graph on debts (mountains of debts accumulated since the two first oil shocks to "find back" previous growth level) should be added, which also makes current crisis a double oil shock more than anything else.

And only the beginning of it ...

Wed, 03/05/2014 - 09:51 | 4511243 Sufiy
Sufiy's picture

The big game - China is behind the scene with its new Cleaner Energy Policy, affecting Coal, Gas and Lithium.


China is moving forward with its state-level strategy to secure supply of strategic commodities. You can follow their footsteps everywhere in Copper, Gold and Lithium.

Wed, 03/05/2014 - 09:51 | 4511244 semperfi
semperfi's picture

Putin to illegitimate Ukraine leader:  "put back the democratically elected leadership and I'll cut you some slack on your gas payments - otherwise, interest accrues at 5% per week" - and by the way, next month's bill must be paid in gold - have a nice day - Vlad"

Wed, 03/05/2014 - 09:59 | 4511263 geno-econ
geno-econ's picture

Yesterday PIMCO announced new fund to buy many billions of European bank toxic mortgage assets in order to obtain higher yield for subscribers, including US pension funds. The fund is already oversubscribed. No doubt this will provide European banks with funds to bailout Ukraine. The world financial system has become one gigantic Ponzi scheme. Question is what will trigger a meltdown ? Unfortunately, Ukraine already has some meltdown experience in the nuclear field with a Russian designed facility.

Wed, 03/05/2014 - 10:06 | 4511282 dimitar
dimitar's picture

somehow not worth mentioning


Wed, 03/05/2014 - 10:19 | 4511326 smacker
smacker's picture

So, it looks like a Maidan "false flag" incident, which of course our gormless Western leaders bought into hook, line and sinker, because it suited their own agenda of getting rid of Yanukovich.

Wed, 03/05/2014 - 10:09 | 4511292 Hubbs
Hubbs's picture

Looks like the Russians will have to deliver the gas for free, since Ukraine can't afford to pay for it.  But  to insure its delivery, it will have to be delivered by the Russian Army.

Wed, 03/05/2014 - 10:37 | 4511396 smacker
smacker's picture

It seems the EU and other Western countries have played this game with seriously bad tactics.

By stirring up a revolution against Yanukovich - one arrested participant in the Kiev revolution alleges he saw about 60 Americans (CIA operatives?), 40 Germans and some Turks & Poles actively involved in creating mayhem in Kiev - the West has forced Putin's hand and we now see the consequencs of that.

What did the US, UK & EU hope to gain?? Energy security?? LOL.

Did they think that if Yanukovich was overthrown that Ukraine would turn back to the EU? And the West would then have better control of its gas suppies? LOL.

Whichever way this game plays out, it remains a fact that the source of the gas that transits thru Ukraine is Russia and Putin potentially has his hand on the taps if the West gets really nasty with him. Ukraine is just a transit route to Europe for gas, not the supplier, and takes what it needs for itself. Whoever controls Ukraine, this will remain the case.

The other item on the West's agenda is to open Ukraine's doors to NATO bases, to further ring-fence Russia. Putin obviously knows this and will attempt to prevent it. His occupation of Crimea would mean that if the West were to get into Ukraine, it will be surrounded by Russian military bases on at least two sides.

Wed, 03/05/2014 - 10:41 | 4511421 BuddyEffed
BuddyEffed's picture

So maybe we should just cede Crimea to Russia and call the Ukraine debt forgiven?

Wed, 03/05/2014 - 10:53 | 4511472 Flakmeister
Flakmeister's picture


RT news?

An Estonian apparatchik?

Wow!  You guys really love to lap up this shit....

Putin's man at the MiniTrue is laughing into his sleeve...

Wed, 03/05/2014 - 10:57 | 4511505 forwardho
forwardho's picture

Ukraine is on the hook for some serious Vig!

In theory, you can bite the hand that feeds you, However most rational people will think of the consequences of such action before actually doing so.

Wed, 03/05/2014 - 10:58 | 4511511 kellycriterion
kellycriterion's picture

It seems the Ukrainians haven't acquired the knack of providing for themselves even with years of Russian subsidies. But of course they can't bear to be parted from the Crimea and the inhabitants they love like their own children. It's like heartless social services taking their children because they aren't being fed or clothed properly.

And then there's the EU. They can't wait to become Ukraine's new sugar daddy. Aren't Spain and Greece and Portugal and Italy and France part of the EU? What about the people of those countries and the leaders who took a solemn oath to represent their interests? It's almost like there's no sense of responsibility or practicality. And it's all really, really, in your face obvious.

In Europe they should build bonfires and dance and chant and pray to the sacred totems of nation statehood. Flags, maps, guns. Like their prehistoric ancestors prayed to the animals they hunted, spirits, dead ancestors. So they won't feel so afraid of well everything but especially death. So they won't feel insignificant and meaningless. It's all a big game, a distraction. Everybody knows it at some level.

Wed, 03/05/2014 - 13:35 | 4512395 Bobportlandor
Bobportlandor's picture

Ukraine should just blow up a section of pipeline then charge a protection fee to secure the rest.

A Billion a year should cover it.

Wed, 03/05/2014 - 13:37 | 4512414 erushbass
erushbass's picture

Perhaps somebody might bail me out when I get my next gas bill......

Thu, 03/06/2014 - 11:19 | 4516657 MoneyThimbles
MoneyThimbles's picture

Would be interesting to know if those existing contracts are denominated in dollars or roubles. If Putin were smart he would insist on all contracts for gas going to Ukraine and Europe being denominated in roubles, as it would put a floor under his currency and strike at the dollar at the same time.

Or gold, of course.


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