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Russia And China About To Sign "Holy Grail" Gas Deal
Several weeks ago we reported that in response to ongoing alienation of Russia by the west Putin was aggressively setting the stage for Russia's eastward expansion, set to culminate with a "holy grail" gas deal with China. We said that "while Europe is furiously scrambling to find alternative sources of energy should Gazprom pull the plug on natgas exports to Germany and Europe (the imminent surge in Ukraine gas prices by 40% is probably the best indication of what the outcome would be), Russia is preparing the announcement of the "Holy Grail" energy deal with none other than China, a move which would send geopolitical shockwaves around the world and bind the two nations in a commodity-backed axis."
Reuters added, reflecting on the recent trip of Rosneft executive chairman to Asia, that "the underlying message from the head of Russia's biggest oil company, Rosneft, was clear: If Europe and the United States isolate Russia, Moscow will look East for new business, energy deals, military contracts and political alliances. The Holy Grail for Moscow is a natural gas supply deal with China that is apparently now close after years of negotiations. If it can be signed when Putin visits China in May, he will be able to hold it up to show that global power has shifted eastwards and he does not need the West."
It's time for an update. According to Itar-Tass, "Russia's Gazprom and China are poised to conclude a gas supply contract in coming weeks, the first in a series of energy projects planned between the two countries. "We’re working now to sign a gas contract in May," said Deputy Prime Minister Arkady Dvorkovich. "Consultations are continuing and Gazprom's leaders are holding talks with Chinese partners on the contract terms. We hope to conclude the contract in May and believe it should come into effect by the year end."
The key sticking point remains the price: "Base price is the only problem to be solved,” Dvorkovich said on Wednesday at a session of a Russia-China intergovernmental commission on energy co-operation, co-chaired by Chinese Vice-Premier Zhang Gaoli." However, even if Russia concedes the topline to China, it will surely "more than make up for it in volume" to borrow a line from Amazon, and furthermore the geopolitical implications from such a deal, not to mention the increase in national leverage vis-a-vis its dealings with Europe and the West, will more than make up for any immediately revenue shortfalls.
But wait - there's more in the rapidly shifting geopolitical axis which increasingly positions Russias as a key commodity source for China:
In other plans, Russian company Novatek’s Yamal region LNG (liquefied natural gas) project was near ready for signing, Drovkovich said. Russia's Rosneft had several interesting plans "seeking to increase maritime supplies by several million tonnes per year,” he said.
“Russia and China have agreed to jointly develop gas fields in (Russia's far eastern) Sakhalin and East Siberia,” Dvorkovich said. “We have discussed co-operation in the coal sphere, agreeing to develop deposits, supply equipment and build electric power plants as well as providing China with additional electricity supplies”.
“We’re finding mutually advantageous decisions on certain projects that will allow us to implement them in the shortest period of time,” Dvorkovich added. Conditions were right to speed the Tianjin oil refinery project and to build a petrochemical facility, he said.
This is happening as Ukraine announced overnight that it won't import Russian gas in April due to the surge in price that Gazprom is demanding from the US proxy state, and following ongoing Gazprom invoiving of how much Ukraine owes it which at last count was well over $2 billion - an amount which we be funded from the still to be finalized western aid to be provided for Ukraine.
Of course, at this pace, Ukraine and even Europe, will become far less meaningful markets to Russia as Putin prepares to announce what indeed would be the holy grail of gas supply deals, one that reduces Russia's reliance on European energy imports and substantially raises Russia's relevance to China as the two countries increasingly become the bestest of buddies.
Which certainly is also why, as Bloomberg reported this morning, "in the talks between China and U.S.’s Hagel overnight, the Chinese are taking a different tack. Rather than argue the merits of the disputed islands/history, they seem instead to say that it’s none of the U.S. business to get mixed up in something in another part of the world and between two sovereign nations.
Bloomberg's conclusion: "Not only is this probably music to Putin’s ears, it also serves to ratchet up the tensions."
Just wait to see how "ratcheted up" tensions will be once Russia and China are finally locked into a bearhug of mutual codependence.
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Is anyone in the U.S. military going to pull a von Stauffenberg and put an end to this shitshow?
It would be a lot less messy than having a Civil War II.
I think they're trying to find Tom Cruise(!)
This is all theater scripted for the muppets. 2 thumbs down
Here comes the war Washington wants so badly they can taste it. Ukraine would not move without approval from NATO and I think they just got it!
"Ukraine’s acting Interior Minister is threatening to resolve “in 48 hours” the situation in eastern regions where administrations of at least two cities are controlled by protesters demanding a nationwide referendum on the state structure.
Arsen Avakov told journalists on Wednesday that the coup-imposed government is ready to use force in the mutinous eastern regions"
Funny how a minorty coup government that took power at gun point is now demanding loyalty from people who never got a chace to vote on the new Amerrican rulers of Ukraine. Power grab looked like a clean win for NATO, now, not so clean. Here we go. Russia is unlikly to sit there and watch an illegal coup government kill Russian Ukrainians. The Guns of April?
It gets better. Ukrainian riot troops in the East are: "A journalist of Russia’s Lifenews TV channel reported from the central square of Kharkov that according to evidence witnessed by the local citizens, some police officers dressed in uniforms of the Jaguar riot police task force seem unable to understand when addressed in either Ukrainian or Russian. They reportedly communicate with each other in English."
Shocked. Mind blown. /s
$5bn spent and the mercs don't speak Russian or Ukrainian.
Russia would have a media show displaying captured mercs. The US liberal media would never show it. Especially before the November election.
Those mercs have NO idea the danger they are in. This isn't Iraq, Russians have braines, they will know when, where and how to deal with these highly paid, by our tax dollar, mercs. A Russian TV show with arrested American Mercs? This is not so far fetched as one might think, and yes, western media will ignore it on orders from Washington DC. There is no media outside the internet world any longer in the USSA.
I forsee some Greystone folks getting picked up and made to do the "Merc Walk"... Should be entertaining...
"In essence, this is a war between the big companies to control the energy deposits. The biggest barrier now are the state-controlled giants in Russia and China and neoliberalism is trying to conquer these countries. The Western companies have declared war against companies like Gazprom, as they seek to control all the energy deposits, but in this case things are not so easy. The neoliberal model that opens the road for the Western capital, has to face now, two superpowers."
http://failedevolution.blogspot.gr/2014/03/the-closed-system-of-biggest-...
Jim Willie has a few words about trading in things other than $USD.
Whole Eastern World Rebelling Against the Dollar-Jim Willie
http://www.lewrockwell.com/2014/04/greg-hunter/dollar-rebellion/
And This one.
Emerging Dynamics of Petro-Yuan Standard
http://www.gold-eagle.com/article/emerging-dynamics-petro-yuan-standard
I cant decide whether the quality of information provided by a guy calling himself the Golden Jackass being better than that of the MSM is exhilerating or terrifying.
Now, the Germans, being the smart folk they are, may wake up as say F the EU and join with the Anti Bolshevik Federation of Russia. I mean, what benefit do they get out of the EU other than being pilfered to support the freeloaders in Belgium?
It's become 2 huge sovereign superpowers against the globalist bansters of the US and Europe (IMF).
The globalist IMF banksters want total control
China and Russia just used the globalist banksters to build up power and wealth.
Let's see who wins.
China and Russia look a lot stronger.
Its time for Ukraine to dictate new Russian natural gas transfer fees.
That will work, lights out in Western and Eastern Europe.
CIA & Rothschild Regime is running out of time to start the war. Guys, you'd better hurry!
LOL, the Russians and China took the IMF dummies for all they could.
Now it seemslike Russia and China are running the show.
Russia, sell the Eurocrats gas in gold.... See how the markets react.
Would be great to see Germany forced to demand their gold from the US for future LNG purchases.
There will be some scramble to build LNG tankards and storage so Europe can buy all the reportedly massive amounts of NG in USA
Boom Town.
The US has been inflating the NG reserves. It makes the libtards look real good. When it comes time to deliver people in the US will be shocked at how high their NG bills will go up.
Another libtard political sham.
By the time this whole ordeal goes weapons hot, Russia and China will have their Naval forces just where they need them. Then the US will roll out the stealth ships, hypersonic attack drones, and God knows what in Hell the MIC has orbiting the planet.
It'll get ugly and pile and piles of people will be erased in order to let these petulant arrogant, psychopath, power broker slobs have their way.
Meanwhile, you're supposed to go to Costco and get fat, stand in line at a bloody pharmacy like Oliver Twist waiting for his porridge, jerk off to porn and shut the fuck up and stay asleep. Jesus fucking goddamn Christ, no wonder we're going to get clobbered.
And 99.9% of Americans won't understand the events that led up to the mushroom clouds outside their window.
It's a paradigm shift!!!
I can't let this happen!! 20:15
https://www.youtube.com/watch?v=LUY3QbmJfQg
Our problems stem from a SEC that should be doing something and is doing nothing and a State Dept. which should be doing nothing but is doing nefarious somethings....
The Dollar & Gold's Fight To The Death
https://www.youtube.com/watch?v=161Rnuf62Nc
What happens when the US stops all sales of physical gold?
Is this being done on purpose? PCR says no. I don't agree.
Hmmm interesting how this is all coming to be:
Germany was quick to ally themselves with a Russia far more repugnant than this Russia... they will again... and soon. And we have.... er... Obunga... Kerry... Hagel... Rice... Hillaroid. 2016 is a LOOOOOONG way away. (shit)
Uh huh, but we prolly won't get there before this entire $hit show collapses. No prob though, I ordered the extra-large bucket of buttered popcorn.
Europe should be worried.
We need Obama to come in and broker a deal with India to outsource Harley Davidson manufacturing to show Putin who's boss.
The US has the Fed to print all the dollars it needs and the libtard media to pacify the masses.
Any company outsourcing to overseas is no longer a big deal as long as the US dollar dosen't die.
When it costs $8 for a simple loaf of bread it starts to be a big deal.
When I was a kid bread cost $.25.
Back then $2 bread seemed outrageous.
It is not outrageous because it is a numerator, with the denominator hidden from view.
So, $.25/$1 is no different than $2/$8 or $8/$32.
Before 1971 I could tell you what the denominator was. After 1971 the denominator was presumed to no longer exist.
But in fact it is just hidden in the balance sheets of Central Banks.
To figure out what it is you just have to deduct all the CB's reserve assets which depend on the value of a fiat currency for value - ergo deduct the paper. Whatever the predominant non-paper-promise-dependent asset remains, that is the denominator.
When I was a kid bread cost $.25.
Back then $2 bread seemed outrageous.
It is not outrageous because it is a numerator, with the denominator hidden from view.
So, $.25/$1 is no different than $2/$8 or $8/$32.
Before 1971 I could tell you what the denominator was. After 1971 the denominator was presumed to no longer exist.
But in fact it is just hidden in the balance sheets of Central Banks.
To figure out what it is you just have to deduct all the CB's reserve assets which depend on the value of a fiat currency for value - ergo deduct the paper. Whatever the predominant non-paper-promise-dependent asset remains, that is the denominator.
Russia’s Petro-Ruble Challenges US Dollar Hegemony. China Seeks Development of Eurasian Trade
.
China will re-open the old Silk Road as a new trading route linking Germany, Russia and ChinaGlobal Research, April 08, 2014
"Russia has just dropped another bombshell, announcing not only the de-coupling of its trade from the dollar, but also that its hydrocarbon trade will in the future be carried out in rubles and local currencies of its trading partners – no longer in dollars – see Voice of Russia ..."
Added to this is the declaration today by Russia’s Press TV – China will re-open the old Silk Road as a new trading route linking Germany, Russia and China, allowing to connect and develop new markets along the road, especially in Central Asia, where this new project will bring economic and political stability, and in Western China provinces,where “New Areas” of development will be created. The first one will be the Lanzhou New Area in China’s Northwestern Gansu Province, one of China’s poorest regions...
Curiously (sic), western media have so far been oblivious to both events. It seems like a desire to extending the falsehood of our western illusion and arrogance – as long as the silence will bear..."
The U.S. is under attack from within. The Queen is a puppet of the CFR.
" trade will in the future be carried out in rubles and local currencies of its trading partners – no longer in dollars"
THIS IS FALSE (AND NAIVE).
So long as the rest of the commodities markets - the trade for real things - is settled in Dollars, the Dollar remains the Numeraire in the transaction.
This is because Yuan, Rubles, and other local currencies are denominated in Dollars.
In essence what they've done is no different than if they were to pay in Quarters, or in Cents, both of which are arbitrary values numerated by the dollar.
Of course...Amongst Central Banks there is a real, physical numeraire that is not based on the Dollar, upon which in fact, the Dollar itself is still legally based (though without possibility of redemption).
GOLD.
Any currency used is a sham that has value only in relation to the main commodity settling currency. If that commodity-settling currency is a fiat currency - whatever its name or supporting organization - then it is still effectively the Dollar.
At some point people need to realize that you can settle in real stuff, or in paper. And that if you settle in paper you are settling in the Dollar by any other name.
It doesn't really matter whose picture goes on the currency, or what agency issues it. The problem with settling in the Dollars is that you are trading something of real physical value in return for something of arbitrary discretionary value. Whatever the name of the organization, it will in fact be issued by the very same bankers that make the Dollar a problem, and will carry the exact same characteristics that make the Dollar undesireable.
So, sorry!
It has to be the Dollar by any other name or GOLD.
This is not likely to work well for at least two reasons: 1. local currency, including the Yuan, are not predictable year to year. Both parties are sellers for survival in the shortrun. 2. China produces very few quality goods so barter with Russia is not probable. In the end this is a logical transaction but not between two gangs which are not accustom anything less that mercantilism. This is not a commercial relationship, but rather, a military-commerical relationship. Like breakfast in the middle of a gang war. The existing rail connetions, highway and air routes between Russia and China are NOT crowded or even near capacity. Demand by either party for trade is nil. Finally, Africa and India are going to get some good deals on goods and services from China and Russia, but there is almost no demand for Rubles or Yuan in South America, USA, EU, or Japan. You must draw the whole circle to see how the game must be played. Something is lacking.
Why wouldn't Russia negotiate energy deals with China regardless of what's happening in Europe and the West. Much more cost effective [read: profitable] to deliver their resorces to a closer neighbor. We shouldn't give a f&(%k about this deal - if it's profitable, it will happen regardless...
Exactly.
Looks like 'merikins will be wallpapering their "recovery" shacks with Benny Bucks.....
This is a good deal for Russia. It is a good deal for China.
Long term Russians are at the greatest risk.
Russians will be trading something real and physical - GAS.
China will be paying in (by proxy) ...Dollars. Even if they settl ein Yuan or Roubles, so long as the rest of the commodity markets are in Dollars, the Dollar will be the defacto numeraire of the transaction.
This is why the Dollar reserve currency system without a Gold backing is so bad. People give away real things with real value in return for paper that represents nothing real.
Of course, there is one way that China could pay that would not be based on Dollars at all...
Gold.