Europe Goes "All In": Will Sanction Rosneft, Gazprom Neft And Transneft

Tyler Durden's picture

Until this moment, the main reason why everyone mostly dismissed Europe's sanctions against Russia is that despite all its pompous rhetoric, Europe consistently refused to hit Russia where it would hurt: its energy titans Gazprom, Rosneft And Transfneft. The reason is simple: by imposing sanctions on these core energy exporters, Europe would directly threaten the stability of its own energy imports (Russia accounts for up to 30% of German gas imports), and as winter approaches with every passing day, playing with the energy status quo would seem like economic suicide. This all appears to have changed last Friday, when as the FT reports from a leaked copy, Europe's latest sanctions round will boldly go where Europe has never dared to go before, and impose sanctions on the big three: Rosneft, Gazprom Neft and Transneft.


This is what is known in game theory terms as a major defection round.

It also means that suddenly the stakes for Russia, and thus Europe, just got all too real, as Putin will now have no choice but to really ramp up the retaliatory escalation, which following the food ban can only mean one thing: a staggered reduction in gas flow to Europe.


It also means something else: recall that it was just ten days ago when we reported that Gazprom would begins accepting payment for oil in Ruble and Yuan.

If today's news is confirmed, Europe's dramatic shift in sanctions strategy means that Europe's embargo of both the US Dollar and the Euro will accelerate as Russia further intensifies its shift away from both the west and the petrodollar. The only and clear winner here: China, which will almost certainly step in to provide the funding Russia needs however on Beijing's terms in effect making the symbiotic link between Russia and China even stronger, forcing Moscow to rely almost exclusively on China for trade and funding relations, and suddenly give Xi Jinping all the trump cards.

What China's president will do, now that he has all the leverage in the world to call shots both to the West, the East, and of course, Africa, remains unknown, although those thousands of tons of gold imports that mysteriously enter the country and are never heard from again, may provide a hint.

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lakecity55's picture

UK: "We must maintain a strong offense against Russia!"
Scotland: "So, you have a mouse in your pocket?"

crowd's picture

If Russia was going to cut the gas anyway it all makes sense.

Mike Masr's picture

I cannot wait for the sanctions boomerang to come back at the EU!!

gcjohns1971's picture

You mean all those European Gas customers didn't like being threatened with death-by-nuclear-fire for not purchasing enough gas at Russia's desired price?

Who knew?

Nevermind.  It is not real.  They just have wee little CIA men sitting on their shoulders telling them lies.  Any sane person would love to have a neighboring vendor dictate to them what they will buy, in what quantities, and at what price on pain of death. 

I mean, truly, who DOESN'T love a gun in their face?  I know it makes me all tingly.

Don't they know that Russia is the freer alternative?

gcjohns1971's picture

Yuan is going to appreciate.

I wonder if the Chinese have fully thought out what this will do to their export economy.

basho's picture

September 08, 18:56

BRUSSELS, September 08./ITAR-TASS/.

EU countries failed to approve a new round of sanctions against Russia through written procedure on Monday,

a West European diplomatic source told ITAR-TASS.

Now the ambassadors of the 28 EU countries will have to meet in person to discuss the situation, the source said.

Whitehall's picture

Too bad the Europeans didn't take this guy's advice 5 years ago. 

Instead, Germany has been CLOSING its nukes.

Instead, the Germans are increasing their imports of US coal.  The investment plays in the US will be coal companies like Peabody and Consol and the railroads who haul the coal to the export terminals like CSX.

talisman's picture


C'mon, jump in -- the quicksand is fine !!