China-Russia is a match made in heaven, and that’s scary

Gestart door jurrien visser (JuVi op Twitter), 22/05/2014 | 19:56 uur

jurrien visser (JuVi op Twitter)

What Russia's Holy Grail Gas Deal with China Really Means for the U.S.

June 2, 2014     

BRICs, russia china alliance, end of petrodollars, xi jinping vladimir putin, china russia energy, china russia cold warThe mainstream media are falling over themselves talking about Russia's just-signed "Holy Grail" gas deal with China, which is expected to be worth more than $400 billion. But here's what I think the real news is... and nobody's talking about it—until now, that is.

China's President Xi Jinping has publicly stated that it's time for a new model of security, not just for China, but for all of Asia. This new model of security, otherwise known as "the new UN," will include Russia and Iran, but not the United States or the EU-28.

This monumental gas deal with China does so much more for Russia than the Western media are reporting. First off, it opens up Russian oil and gas supplies to all of Asia.

It's no coincidence that Russian President Putin announced the gas deal with China at a time when the tensions with the West over Ukraine were growing. Putin has US President Obama exactly where he wants him, and it's only going to get worse for Europe and America.

But before I explain why that is, let's put this deal in terms we can understand. The specific details have not been announced, but my sources tell me that the contract will bring in over US$10 billion a year of revenue to start with. The 30-year deal states that every year, the Russians will deliver 1.3 trillion cubic feet (TCF) of gas to China. The total capital expenditure to build the pipeline and all other infrastructure for the project will be more than $22 billion—this will be one of the largest projects in the world.

You can bet the Russians won't take payment in US dollars for their gas. This is the beginning of the end for the petrodollar.

The Chinese and Russians are working together against the Americans, and there are many countries that would be happy to join them in dethroning the US dollar as the world's reserve currency. This historic gas deal between Russia and China is very bad news for the petrodollar.

Through this one deal, the Russians will provide about 25% of China's current natural gas demand. In a word, this is huge.

It's also not a coincidence that Putin sealed the deal with China before the Australian, US, and Canadian liquefied natural gas (LNG) terminals are completed. If you read our recent Casey Energy Report issue on LNG, you know to be wary of the hype about LNG's "bright future." Take note: this deal is a serious negative for the global LNG projects.

I also stated in our April 2012 newsletter:

Putin has positioned Russia to play an increasingly dominant role in the global gas scene with two general strategies: first, by building new pipelines to avoid transiting troublesome countries and to develop Russia's ability to sell gas to Asia, and second, by jumping into the liquefied natural gas (LNG) scene with new facilities in the Far East.

Pretty bang on for a comment that was made over two years ago in print, don't you think?

So, what's next? Lots.

Putin will continue to outsmart Obama. (Note to all Americans: the Russians make fun of you—not just for your poor choice of presidents, but also for your failed foreign policy that has led to most of the world hating America. But I digress.)

You will see Russia announce a major nuclear deal with Iran, where the Russians will build, finance, and supply the uranium for many nuclear reactors. The Russians will do the same for China, and then Syria.

With China signing the natural gas deal with Russia and the president of China publicly stating that it's time to create a new security model for the Asian nations that includes Russia and Iran, it's clear China has chosen Russia over the US.

We are now in the early stages of the Colder War.

The European Union will be the first victim. The EU is completely dependent on Russia for its oil and natural gas imports—over one-third of the EU-28's supply of oil and natural gas comes from Russia.

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Our Casey Energy Report portfolio has already been doing quite well from investing in the European Energy Renaissance, but this is only the beginning. If Europe is to survive the Colder War, it has no choice but to develop its own natural resources. There are naysayers who claim that Europe cannot and will not do that, for many reasons. I say rubbish.

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jurrien visser (JuVi op Twitter)

China, Russia to Test Maritime Coordination in Joint Drill


The Chinese and Russian navies are now sailing toward the northern part of the East China Sea as part of a week-long set of maritime drills.

The joint drills were officially kicked off in-port on Tuesday.

Duan Zhaoxian is in-charge of the Chinese side.

"The highlight of the drills is our anti-surface warfare training. We don't know yet how well the drills will proceed. In addition, the drills between surface vessels and submarines will involve more advanced weapons with bigger shooting ranges than those used the past few years. So this year, our anti-surface drill more closely resemble actual combat."

For the first time, Russian and Chinese sailors will work together on ships from both sides.

Russian commanders say they've already been talking with their Chinese counterparts ahead of the drills.

"During our discussion, we managed to hone our coordination and find common ground. It will make a great difference in building mutual trust and understanding, as well as in helping the Chinese and Russian commanders to better lead and work together. The No.2 Formation consists of four ships, the missile cruiser Varyag, the destroyer Bystry, the Chinese warship Harbin, and the tanker Ilim. We will focus on actions that include escorts, the freeing of hijacked ships, anti-submarine maneuvers, and search and rescue operations."

The joint exercise will run through Monday.

This is the 3rd time the Chinese and Russian navies have held joint drills in the same area.

Voor het gehele verhaal, zie link.

jurrien visser (JuVi op Twitter)


Nu zal moeten uitwijzen wie het echte politiek spel meester is  :devil:

Het westen zal weer  toenadering moeten zoeken bij de Russen, maar ja.....hoe doe je dat ? Pas geleden nog bedreigingen geuit, sancties opgelegd, en Rusland  'geisoleerd'

Rusland gaat hier in ieder geval garen mee spinnen.

jurrien visser (JuVi op Twitter)

Russia-China Gas Deal Alters Global Balance Of Power

Charles Krauthammer / May 22, 2014

On Wednesday, it finally happened — the pivot to Asia. No, not the United States. It was Russia that turned East.

In Shanghai, Russian President Vladimir Putin and Chinese President Xi Jinping signed a spectacular energy deal — $400 billion of Siberian natural gas to be exported to China over 30 years.

This is huge. By indelibly linking producer and consumer — the pipeline alone is a $70 billion infrastructure project — it deflates the post-Ukraine Western threat (mostly empty, but still very loud) to cut European imports of Russian gas. Putin has just defiantly demonstrated that he has other places to go.

The Russia-China deal also makes a mockery of U.S. boasts to have isolated Russia because of Ukraine. Not even Germany wants to risk a serious rupture with Russia (hence the absence of significant sanctions). And now Putin has just ostentatiously unveiled a signal 30-year energy partnership with the world's second-largest economy. Some isolation.

The contrast with President Obama's own vaunted pivot to Asia is embarrassing. He went to Japan last month also seeking a major trade agreement that would symbolize and cement a pivotal strategic alliance. He came home empty-handed.

Does the Obama foreign policy team even understand what is happening? For them, the Russia-China alliance is simply more retrograde, 19th-century, balance-of-power maneuvering by men of the past oblivious to the reality of a 21st century governed by law and norms. A place where, for example, one simply doesn't annex a neighbor's territory. Indeed, Obama scolds Russia and China for not living up to their obligations as major stakeholders in this new interdependent world.

The Chinese and Russians can only roll their eyes. These norms and rules mean nothing to them.

Obama cites modern rules; Russia and China, animated by resurgent nationalism, are governed by ancient maps. Putin refers to eastern and southern Ukraine by the old czarist term of "New Russia." And China's foreign minister justifies vast territorial claims that violate maritime law by citing traditional ("nine-dash") maps that grant China dominion over the East and South China Seas.

Which makes this alignment of the world's two leading anti-Western powers all the more significant. It marks a major alteration in the global balance of power.

Putin to Shanghai reprises Nixon to China. To be sure, it's not the surprise that Henry Kissinger pulled off in secret. But it is the capstone of a gradual — now accelerated — Russia-China rapprochement that essentially undoes the Kissinger-Nixon achievement.

Their 1972 strategic coup fundamentally turned the geopolitical tables on Moscow. Putin has now turned the same tables on us. Their enhanced partnership marks the first emergence of a global coalition against American hegemony since the fall of the Berlin wall.

Indeed, at this week's Asian cooperation conference, Xi proposed a brand-new continental security system to include Russia and Iran and exclude America. This is an open challenge to the post-Cold War, U.S.-dominated world that Obama inherited and then weakened beyond imagining.

If carried through, it would mark the end of a quarter-century of unipolarity. And herald a return to a form of bipolarity — two global coalitions: one free, one not — though, with communism dead, not as structurally rigid or ideologically dangerous as Cold War bipolarity. Not a fight to the finish, but a struggle nonetheless — for dominion and domination.

To which Obama, who once proclaimed that "no one nation can or should try to dominate another nation," is passive, perhaps even oblivious. His pivot to Asia remains a dead letter. Yet his withdrawal from the Middle East — where from Egypt to Saudi Arabia, from Libya to Syria, U.S. influence is at its lowest ebb in 40 years — is a fait accompli.

The retreat is compounded by Obama's proposed major cuts in defense spending (down to below 3 percent of GDP by 2017) even as Russia is rearming and China is creating a sophisticated military soon capable of denying America access to the waters of the Pacific Rim.

Decline is not a condition. Decline is a choice, Obama's choice. And it's the one area where he is succeeding splendidly.

Charles Krauthammer is a syndicated writer in Washington. His email address is
Copyright © 2014, The Hartford Courant,0,5352514.column


Citaat van: jurrien visser op 22/05/2014 | 23:01 uur
Daar heb je, m.i., gelijk in, we staan schaak.... maar is het ook schaakmat?

Nee, dan is voor Putin de "lol" eraf.

Voor nu eerst maar zien wat de nieuwe joint venture nog meer gaat en kan bedenken. Met China samen, vriendjes met landen worden die rijk zijn aan olie en delfstoffen ?.  De Noordpool verden inpalmen ? Zij hebben nu immers de verzekering dat de NAVO, VN en EU niet echt van plan zijn om in een militair conflict terecht te komen. Dat heeft de crisis in Oekraine en de Krim wel aangetoond. Was m.i, blijkt nu, een testcase. Kijken of het alleen bij blaffen blijft.......

jurrien visser (JuVi op Twitter)

Citaat van: Ros op 22/05/2014 | 22:40 uur
Kan zeggen wat je wil........maar die Putin is een gehaaide diplomaat en politicus  :cute-smile:

Daar heb je, m.i., gelijk in, we staan schaak.... maar is het ook schaakmat?


Inkomen uit Russisch gas voor een groot deel zeker gesteld door de deal met China. Als de EU weer gaat piepen en dreigen of invoeren van sancties kan de kraan met gemak beetje voor beethe dicht worden gedraaid. Zou maar snel de strooppot uit de kast trekken en fors gaan smeren rond het bekje van de Russische beer.

Kan zeggen wat je wil........maar die Putin is een gehaaide diplomaat en politicus  :cute-smile:


Citaat van: jurrien visser op 22/05/2014 | 20:05 uur

Wel pleit het voor een sterker Europa, vooral niet te verwarren met de VsVE, een continent wat in de toekomst toch meer zijn eigen broek moet kunnen ophouden nu de Amerikanen meer hun focus verleggen.

jurrien visser (JuVi op Twitter)

Citaat van: Vandaag om 07:56
China-Russia is a match made in heaven, and that's scary

In het kader van continent overschrijdende verschijnselen heb ik toch maar een nieuw topic aangemaakt.

De kop van het topic spreekt boekdelen, de vraag is hoe reëel is het gevaar voor het westen als de Russen en de Chinezen de handen meer in een slaan.

De eerste tekenen zijn niet  bemoedigend, we zien momenteel een sterke toenadering op economisch en militair gebied en daarnaast vertonen beide landen territoriale expansiedrift en kunnen we beiden rekenen tot een nucleaire grootmacht met veto recht in de Veiligheidsraad...

Wel pleit het voor een sterker Europa, vooral niet te verwarren met de VsVE, een continent wat in de toekomst toch meer zijn eigen broek moet kunnen ophouden nu de Amerikanen meer hun focus verleggen.

jurrien visser (JuVi op Twitter)

China-Russia is a match made in heaven, and that's scary

By Anatole Kaletsky May 22, 2014


As Russian President Vladimir Putin signed Russia's historic $400 billion gas-supply agreement with China, he must have felt the satisfaction of a chess grandmaster revealing the inexorable outcome of a complicated endgame.

In theory, the next phase of the chess match between Russia and the West in Ukraine will only begin with the Ukrainian presidential election on Sunday. But Putin's positioning of the pieces means the outcome is pre-ordained, no matter who emerges as the next president in Kiev.

putin & troopsNo wonder the Russian stock market and ruble have both rebounded — with the MSCI Russia index gaining 20 percent in dollar terms since its low point on March 14.

Having secured the territorial windfall of Crimea in March, Putin went on to achieve his main tactical objective in April. This was to destabilize Ukraine to the point where nobody could seriously contemplate the country joining the European Union, much less the North Atlantic Treaty Organization.

Just as important, from Putin's standpoint, the combination of internal chaos and improvised plebiscites and Russian military exercises being conducted on the Ukrainian border, distracted Western attention from the Crimean issue. He deflected the threat of additional sanctions from the legality of Russia's annexation to the feasibility of Ukraine's presidential election.

Now that analysts are predicting no major violence at Sunday's election, it is hard to see what arguments the West could offer for tightening sanctions — or how they would find the unity to do it if they tried. The incorporation of Crimea into Russian national territory has, in effect, been accepted by the world as irreversible.

Given Sevastopol's priceless strategic significance as a naval base, not to mention the Russian people's affection for Crimea as a vacation, retirement and cultural destination, the restoration of Crimea would, on its own, likely guarantee Putin's political popularity for many years to come. But this week the news for Putin got even better.

putin si militaryRussia's strategic gains in Crimea and Ukraine were already apparent by early May, when the Moscow stock market and the ruble started rapidly rising. But now the United States and Europe have delivered Putin another — even bigger — economic and geopolitical windfall: the prospect of a Sino-Russian partnership to balance NATO and the U.S. alliances in Asia.

A few months ago, neither Moscow nor Beijing would have imagined a Eurasian partnership possible — or even desirable. Against a different diplomatic background, Wednesday's Sino-Russian gas agreement might have been just another trade deal. It would seemingly have had no great geopolitical significance apart from its impact on energy prices in different parts of the world.

But things look very different in the light of recent global confrontations, not only between the West and Russia over Ukraine, but also between the United States and China — over Japan, Vietnam, the Philippines and, most recently, cyber-espionage.

When we consider the Western diplomatic ineptitude responsible for these events, culminating in Washington's decision to issue arrest warrants for leading Chinese military figures the very day that Putin arrived in Shanghai, the 30-year energy deal between Russia and China becomes key.

Perhaps Putin's trip to Shanghai could even mark the start of a strategic realignment between nuclear superpowers comparable to the tectonic shifts that began with President Richard M. Nixon's visit to China in 1972. This suggestion may seem far-fetched and grandiose, but there are five reasons why Western leaders are over-optimistic and short-sighted simply to dismiss this idea — as they have done in the past.


China is obviously a rising superpower while Russia is a declining one. This means that both will inevitably experience frictions with the United States and Europe, the hegemonic powers that now dominate global politics and economics. Since Russia is declining, its frictions will mainly involve encroachments on what Russia sees as its economic or territorial prerogatives by U.S. allies in Europe. That is how Russians see the current confrontation over Ukraine. Since China is rising, it will create frictions by encroaching on U.S. allies in the Pacific. In both cases, Moscow and Beijing will be opposed by the United States.


U.S. dominance is on the decline — not because the United States is becoming economically or technologically weaker but because the American public is disillusioned with foreign adventures. They are no longer willing to act as global policemen. This means that U.S. allies can no longer realistically rely on Washington to deter Russia and China, especially in minor territorial disputes. Even if U.S. protection is theoretically "guaranteed" by treaties on mutual defense.


A Sino-Russian axis is a natural fit. The two countries' economies, military capabilities and even demographics complement each other. Russia has excess resources but a shortage of manpower. China faces the opposite problems. Russia is strong in advanced military technologies, aeronautics and software — but weak in mass production of consumer goods and electronic hardware. China has the converse strengths and weaknesses.


A strategic partnership between the world's second largest and sixth largest economies (by purchasing power parity exchange rates) could attract other countries, especially in Asia, that were unable or unwilling to commit themselves to Western standards of political democracy, corporate governance, trade and financial openness or quality and safety of consumer products.


Perhaps most important, a new element has suddenly been injected into super-power relationships by the events in Ukraine, combined with U.S. President Barack Obama's unexpected belligerence to China during his trip to Asia last month. While Chinese and Russian leaders have historically distrusted, and even disliked, one another, they are starting to dislike the United States even more.

Russia's reasons are obvious. In the case of China, there was less distrust until Washington suddenly turned up the heat on cyber-espionage and territorial disputes in the China Seas.

Perhaps this confrontational behavior is just a brief aberration. But if Obama continues to needle and provoke China, he will not just be making an historic blunder — he will be playing straight into Putin's strategy.