Ukraine President Threatens To Revoke Ceasefire, And Putin Wins Again

Tyler Durden's picture

As more sectorally focused Russia sanctions loom as AFP reports Petroshenko is consider revoking the cease-fire over the helicopter downing (and Iraq appears set to light the blue touch paper and retire), we thought UBS analysis of the impacts (gains and losses) on the world's nations from sustained higher oil prices would be worthwhile. As Larry Hatheway notes, an increase of USD 10 in the price of a barrel of oil - driven by supply shocks - will shave around 0.2 to 0.3 percentage points from global growth. Every USD10 per barrel increase in the price of oil typically transfers around 0.5% of global GDP from oil consumers to oil producers. So who gains the most? (Spoiler Alert: ryhmes with usher) And is $115 the tipping point for global growth?


The Chopper dowing that we reported earlier has apparently crossed a red line...


So who gains the most if all hell breaks loose again and the West unveils targeted (energy) sanctions...


As UBS explains,

Investor attention is turning to the 'oil patch' and the risk of energy supply disruptions.

Oil prices have recently edged up on concerns about sectarian violence in Iraq and the associated risk of supply disruptions. Elevated energy prices may also reflect worries about possible western sanctions in the event tensions between Ukraine and Russia escalate further.

A Brent oil price of USD115 has shown to be a tipping point for the world economy. That is indicated by comparing our global growth surprise index and Brent prices (Figure 1, overleaf). Oil prices and global growth surprises are typically positively correlated, as stronger growth lifts crude prices. But there are limits to how far oil prices can rise without triggering a growth slowdown, particularly if unexpected supply shocks push prices up suddenly from already high levels.

Eyeballing the chart above suggests that whenever oil prices have breached USD115 in recent years, global growth has typically taken a turn for the worse.

Simulations on the Oxford Economic Forecasting (OEF) econometric model suggest that an increase of USD 10 in the price of a barrel of oil—driven by supply shocks—will shave around 0.2 to 0.3 percentage points from global growth.

Every USD10 per barrel increase in the price of oil typically transfers around 0.5% of global GDP from oil consumers to oil producers. The model assumes—correctly in our view—that the propensity to spend additional income in the oil-producing complex is lower than it is in the oil-consuming complex.

The same model simulations suggest that oil-intensive emerging countries that lack domestic energy production capacity are typically worse off in any scenario where oil prices are climbing (see Figure 2 below). For instance, East European economies such as Hungary, Czech Republic and Turkey, or Asian economies such as the Philippines, India and Thailand fare relatively poorly in oil shock scenarios. These economies would suffer a shortfall in growth of between 0.5 and 0.7 percentage points after one year should oil prices unexpectedly climb a further USD 10 from current levels.

Oil-producing economies such as Russia or Norway clearly benefit when oil prices rise, enjoying a boost to GDP of up to 0.6 percentage points (Russia) or 0.2 points (Norway). Among large developed economies, the US and Japan are least affected. Prior to the US shale revolution model simulations would have suggested a negative impact of 0.2 to 0.3 percentage points off US growth for every USD 10 increase in the price of Brent. The estimate has dipped to 0.1% according to the most recent estimates. European economies, with higher oil import intensity, are more exposed than the US according to our model-driven estimates.


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Theatrics? as we wondered earlier. With Russian stocks now green YTD and massively outperforming US equities since the sanctions, it seems Obama's only move is energy targeted sanctions.. or did Ukraine just shoot itself in the foot (and help Putin?). It seems he is not impressed either:


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orangegeek's picture

not quite sure how Putin keeps winning when Ukraine is tapping into Europe's supply lines that run through the Ukraine


so instead of paying Russia, Ukraine takes the stuff for free

Doña K's picture

This is the first move in the chess game. If you think 8 moves ahead Putin wins

Boris Alatovkrap's picture

Boris is also like chess!

(Barry is like checker)

Miles Ahead's picture

Orangegeek... I think it's "the Ukraine" that everybody is downing you for.  This group is a bit harsh on us US Americans. Otherwise your analysis pitching a complete shutout on the green up-arrows is a bit harsh I think.  

I'd up-arrow you but my up-arrow key doesn't work...

Rootin' for Putin's picture

"The Ukraine" is an area, like "the Midwest"  unfortunatly there is also a country called Ukraine in The Ukraine.  Its kinda like renaming Minnesota Midwest and seeing what confusion follows.   But like Miles said, americans are worse at doing it.

Volkodav's picture

It is "Ukraine"      not "the Ukraine" 

"Ukraine means borderland"  opening sentence from introduction "Ukraine A History" Orest Subtelny a Canadian of Ukrainian descent.

Ukraine has never been a sovereign nation.

This is the best book for English reader for attempt at understanding Ukraine


Bingo Hammer's picture

"Ukraine means borderland" ok fair enough then, so that's why in English it seems appropriate to add 'the' to Borderland I suppose just like "The Netherlands"...

eg 1 - there is trouble in Borderland?

eg 2 - there is trouble in "the" Borderland?

Suffice it to say that 99% of the population still haven't got a clue where it is in the first place (or even care)


caconhma's picture

I just wonder: How much do Putin's people pay to ZH for propaganda and disinformation?

localspaced's picture

5 cent per line, no benefits. Its a crap job, don't do it. Go flip burgers or join isis or something instead.

Doña K's picture

An anagram of your name is Coachman. That's misinformation!

If you are Spanish then the Anagram of your name is Machacon which means "a pest"

JuliaS's picture

Didn't you know? We all write comments for living! You too can earn $5000 a month, spending just hour per week, posting responses to 12 year olds on behalf of Mr. Putin.

TheSecondLaw's picture

Need to up your wit a bit.  We all know that Putin is an ex-KGB fucker who would pop a cap in the base of your skull without batting an eyelid.  But at least he's honest about it. Obama, on the other hand, while also a thug like Putin, skulks around with his "I'm the good guy" sheepskin on his back. 

So as far as I'm concerned the choice is between a ÿeah-I'm-a-thug  thug, and a I'm-not-a-thug-I'm-the-good-guy  thug.

I'm rooting for the thug who's honest about being one. 

swmnguy's picture

I can't stand Putin. From the very first time I heard of him, nearly 20 years ago, I could tell he was serious trouble.  However, the fact that Putin is a dangerous piece of work doesn't mean that anything and everything anyone else does is just peachy.  The Kiev junta "Yatzis" are the absolute dregs of Eastern Europe and that's saying something, if you've read any of that blood-soaked region's history.

The enemy of my enemy is probably not my friend, either.  The world, and most situations in it, do not involve two opposing teams who mirror each other.  False dichotomies are always promoted by those who think they have something to gain by distracting and misleading people into accepting such cliches.  Anybody who is going to understand the world on any but the most superficial level and stand a chance of being anything other than a pawn knows this.

When I see Putin behaving better than those aiming to bring him down, I need to recognize and acknowledge that.  When I see the US and US puppets causing trouble that will create misery and bring on violent chaos, I need to recognize and acknowledge that.  As a sports fan myself, when my team sucks I need to recognize and acknowledge that, as well.

teslaberry's picture

i love that you brought sports into this and false dichotomies. 


all these fucktards are constantly using the analogy of puting chess obama checkers. it's almost ridiculous how fucking moronic these people are. 


if the world is a sport like soccer. the field is a circle with goals everywhere, and many many different 'teams' sometimes with players switching teams mid-game . and sometimes the team jerseys are confusingly similar. 


which is to say, the great game of civilization is the most complex motherfucking sport that the fans have to have too much free time, and attention spans----to appreciate the game. 

ONE way to spot a real fan of the great game being played at the great arena, is that you never really see them cheering for a team but they applaud a good play now and then. 



potato's picture

Sadly, whether the Kenyan wins, or Putin, we all still lose.

Stumpy4516's picture

I would like to think Putin is that good.  But maybe he is just trying to hold onto as much as possible in a losing game. 

Russia turned its back on Iraq 1 and did not even supply advice or supplies.  They were ineffective in sponsoring an effective counter war.

Russia/Putin abandoned Lybia, did not see it coming and lost a buffer and sphere of influence.

Russia/Putin did not see Syria and allowed Syria to take heavy losses before giving some support.

Putin has been reacting to the CIA/SA/Israel sponsored Sunni movements with words but is ineffective.  If the rolls were reversed the CIA would have stirred up all sorts of clandestine trouble and mayhem for Russia.  How has Putin disrupted the Saudi's or others with internal strife or sabatoge?

Putin never saw the threat of the SWIFT system.  This is inexcusable.

Putin never saw the threat of having the west aligned countries as their majority customer and had no pipeline to China and had not progressed very far in aligning with China. 

Putin never saw the initial Ukran trouble and did nothing but talk and still did not bluntly point out the true sources.

Putin gave some aid to the East Ukran's but there is no defense from the long range cannons and aircraft bomb cities, including with phosphous in violation of international laws. 

The US would have instituted a no fly zone over east Ukran long ago, pointed out the war crimes and bombed all the artillery locations.

So, Putin waits, but the EUkran die.  There may be a point where the EUkran's start to feel unloved and resent it and waiting for next winter for the west to feel some impact means their blood.

If Putin was spewing DUranium all over the ME the US would be showing the world the results.  The US would document and show all the blood and death if Putin was doing the same in the ME. 

If Russia had stolen Germany's gold the US would very publicly make the citizens of Germany aware and pissed in an ongoing PR campaign.

Putin seems to be in some form of damage and loss control.  As if he has the same mentality of other past country leaders who deceived themselves that they could compromise to appease the CIA/US only to find once that attitude allowed the US, or their proxy, to get situated properly the death blows were given to them and their country.  And given when they can no longer strike a counterblow.  I am not sure Putin (and China) have allowed themselves to clearly see what is happening is not just power plays for economic reasons that can be negotiated and compromised but the west intends to destroy them as an independent country and this push is relentless and ruthless without mercy or decency.  Nothing is off limits no matter the how unthinkable.  Bio warfare in it's many forms is not off the table but will occur if all economic terrorism efforts do not appear to be effective.  It will happen unless it is stopped but others have delayed until they have no chance.  Russia and China could raise a white flag and it would be used to gain position for fatal blows to their economic system and cohesiveness as a country

And if the west see's time is working for Putin then the west will change the game and play their cards so that Putin does not have time and must react.  However, having the EU blaming Russia for economic problems due to gas supply might be just what the west would like to cause.  The US/Israel causes it by maintaining the WestUkran's and the fighting while the Germans blame Russia.  The EU's decline is just fine with the US/Israel/UK and even prefered.

Hell, it is completly out in the open that the US has stolen Germany's gold and yet the political powers in Germany make excuses to cover up what the US has done.  They are no threat and will cooperate with the US as the war on Russia progresses.


socalbeach's picture

Medvedev was in charge when Libya fell.  Not a bad post though.

Tao 4 the Show's picture

You forget or overlook the fact that Russia probably has more nukes than the rest of the world put together. Are you sure one side's psychos are more psycho than the others? Think again. None of major poles in the now multipolar world will give in without total defeat.

swmnguy's picture

I don't think Putin is playing from a position of strength, and I also haven't seen any sign that he's a strategic genius.  This meme that he's playing chess but Obama is playing checkers is cute and catchy, but based on...not much.  Russia is, as always, a mess.  Putin, like all politicians, has to play to his domestic gallery, too.  He's made some pretty smart plays considering the options he's been presented with.  But Russia has nowhere near the US ability or appetite for foreign entanglements.  With all the cards stacked in US favor since WWII, Putin is very much on the defensive as the US clearly looks to dismantle Russia per Zbigniew Brzezinski's "The Grand Chessboard" and the other strategies of US Empire which are easy to find and not recent. 

On a side note, isn't it funny to think that even 14 years ago, for one to talk of US global imperial ambitions marked one as a loony lefty?  Today it's discussed openly as a matter of course.  And then, as now, anybody who speaks counter to the US official narrative of the day is invited to "Go Back To Russia;" in 2000 for acknowledging the obvious, and today for not thinking it's a good idea.

teslaberry's picture


I Gave you plus one. 


good points here ; And if the west see's time is working for Putin then the west will change the game and play their cards so that Putin does not have time and must react.

---one counterpoint. wealthier heavily indebted mature nations have a maintance crisis. their political cultural emotional phsycial and financial capital deteriorates faster than poor-low-debt nations. putin and china can have their own crises , but they can afford to weight. a russian chinese peasant dying is much less of a problem for russian/chinese governments than an american dying is a problem for the american regime. 

10,000 peasants would be forgotten by russia or china, in america it's 'an issue'. this is how time is assymetrically at play. furthermore the entire world is very much onto america's strategy of promoting chaos around the world to BUY TIME. the tactics available to carry out this strategy become less and less effective and more and more exepensive each round that this game continues. assymetric political defenses are being erected by the chinese and russians. one of them primarily being my next-----

missing points ; lack of a mention of the HISTORIC china russian alliance AND the historically unpredictable power of china. assymetric political defense. like a football defensive play that not only stops the opposite team, but generates a turnover or interception of the ball and generates offensive capabilities and other political military synergies.

bonus points; mention of biological warfare. the u.s. WILL and probably IS using this. i would argue they are more likely to use this on their own dissidents than the russians or chinese. biological warfare is either too specific, or not specific enough. not a great 'peace-time' weapon. 



negative points; the stirring rift between europe and america is putin's target---the pressure points of the western hegemony are the potential divide between germany and france---which will lead to a fracturing of europe--which will lead to the break up of euro-western alliacne. 


once putin can isolate the u.s. from europe, the u.k. is finished as the u.k. obtains power over france and germany through their strategic beggaring of wall street and u.s. Military industrial complex. 

ultimately to attack the u.s. financial system, putin needs to help exacerbate the acceleration of decline in europe. britain is the anal plug of the u.s. empire and putin needs to get the u.s. so distanced from germano-franco core---that europe tries to unplug the u.k. anal plug from the u.s. 


divide and conquer WORKS BOTH WAYS. 




don't count your empires before they hatch.

teslaberry's picture

ukraine is not russia. when ukranians die, it's the wests fault not russia. 


this plays into the 'time is on putin's side' strategy. 


the more fucked up ukraine is, the more former soviety block countries understand what will happen to them because of the west. they are not stupid. and they are going to give the west more and more expensive prices for everything becasue if the west wants to start a junta everywhere---they will have to pay for the privilege first. 


THUS , the tactics of junta will slowly be more difficult in post soviet countries. they have placed a disstance behind their soviet past, and not as interested in bender over for butt sex with the west as they were in the 90's and early 2000's. 

the tide reverses and time is now on russias side.

JustUsChickensHere's picture

I thought Putin's current move in Ukraine was the simple, inexpensive 'wait for winter' move... plus other smaller nudges if needed.  Very Very low cost and time tested tactic. Prolonged chaos in the energy markets is just a bonus revenue sweetie.

Winston Churchill's picture

Just like shoplifting losses, you know everyone else is going to pay

sometime.There is no free lunch.

Vampyroteuthis infernalis's picture

When the time is appropriate, all the more evidence to invade.

Boris Alatovkrap's picture

From article, "increase of USD 10 in the price of a barrel of oil - driven by supply shocks - will shave around 0.2 to 0.3 percentage points from global growth"

From Boris, "when men is spend money, spill blood, trample crop, destroy city - will shave some unknown percentage point from global growth."

Time for be real folks!

potato's picture

Boris, all the things you mentioned are accretive to GDP.

GDP only goes lower if the climate gets warmer or if oil goes up.

kowalli's picture

Ukraine is stealing from Europe...

cossack55's picture

Why not? The EU is stealing from Europe. Big deal. 

COSMOS's picture

Ukraine was stealing from Europe but the Euros will make the Ukes pay dearly, lol they just forced a coup on them and are set to buy their farmland for pennies on the dollar amongst other things...

The cookie jar lid got slammed down hard.  Time to pay the piper...

swmnguy's picture

There's the part the average mook doesn't seem to understand.  Nobody gets anything for free.  Especially not from bankers.  But the official mythology says the Greeks got in trouble by being lazy slackers, rather than their elites sold them out for 30 silver Euros and EU membership.  The Yatzis want "freedom" and that's why they want to join the EU and get away from those nasty Russkis, but no mention of the fearsome price that will be extracted via the banking mechanism.  Life for the average Ukrainian hasn't been easy for centuries, if ever.  And it's about to head into a more-difficult period now, no matter whom their elites sell them out to this time.

COSMOS's picture

They had it good in Soviet times, they added lots of territory at the expense of other Eastern Euros like Hungary, and Romania, and Slovakia, etc and on top of that had quite a few head honchos in the Politburo.  The Russians gave their little brother everything they wanted even parts of Mother Russia and the Ukes still tried to make out into the night like bandits.  Only problem is that there are lots of big bad wolves out there, some like NATO, USA, and EU lurk in the night, while others are amongst the Uke flock (aka the oligarchs).  Well they got burnt and are going to get frozen also.  I dont feel sorry for them at all, I hope the rest of the territory that belongs to the surrounding countries gets returned.

socalbeach's picture



Russian gas piped through Ukraine as contracted

The Russian Energy Ministry said no illegal siphoning of the gas had been registered in Ukraine

MOSCOW, June 23. /ITAR-TASS/. Russian natural gas is piped to Europe across Ukraine in contracted volumes, Gazprom spokesperson Sergei Kupriyanov said on Monday, June 23.

Over the past 24 hours, about 205 million cubic meters of gas were transported through Ukraine and about 185 million cubic meters a day last week, he said, adding that daily transit had increased by 10%

The Russian Energy Ministry said no illegal siphoning of the gas had been registered in Ukraine. However, Gazprom earlier quoted the Central Dispatch Office of the fuel and energy sector as saying that Ukraine had been siphoning gas since June 19...

IronShield's picture

Ukraine, that's so yesterday...

nopalito's picture

Nothing good will come from this if Sergei Glazyev (video, 10:51) is anywhere close to what is really going on in Ukraine.

cro_maat's picture

nopalio - Excellent find. His analysis is sound. At what point does Russia institue a no-fly zone and take out Ukraine's military targets as the US did in Libya with the U.N.'s blessing?

CrashisOptimistic's picture

Such bullshit. 

And I can assure you if oil dropped $10 (and btw, oil was $103 long before Ukraine or Iraq got ugly, so this article is mostly about $2) they would claim this will be a +1% gain for global GDP hooray.



CrashisOptimistic's picture

Putin wins because people burn oil year round.  He exports 8 million barrels per day and collects $114 brent for it.  Combined with gas (the southern route is not the only route) the total drained from Russia's enemies is $500 billion/year.

(btw the US imports several 100sK bpd from Russia)

Dr. Engali's picture

Isn't it about time to start talking about Greece again?

CrashisOptimistic's picture

They consume about 320K bpd, down from 380K before the smash.

But they are saved, you see.  All is well there.

CrashisOptimistic's picture

There's a lesson there. 

That's how you tell if a country is doing well -- if their oil consumption is rising or falling.


Fast Twitch's picture

"Petro" Poroshenko. What a "Occi" MORON!

potato's picture

"US shale revolution"

CrashisOptimistic's picture

The US has reduced oil imports.

About half that reduction is fallen oil consumption.

See above as to how you tell if a country is doing well.

COSMOS's picture

If the USA would drive fuel efficient cars like the Euros, we would cut our oil consumption in half.

potato's picture

and in half again were the population density similar. and half again if the wages were similar. 

Publicus's picture

After Ebola sweeps the population, we shall be energy indepedent.

cro_maat's picture

In Fascist USSA fuel efficient cars are not allowed. Volkswagon made a diesel hybrid that can reach 260 miles per gallon. This car is banned from the USSA.

Illegal Central Americans by the busload however are welcome. Sign up for free EBT card, medical care and indoctrination training. /Sarc

Miles Ahead's picture

No we wouldn't.  We would just be able to and therefore would double the cars in our garage.

shovelhead's picture

Because dead people don't drive.

Leave the Leaf, grab the Expedition.