No matter how hard Kremlin tried to intimidate the EU by raising energy prices, the European gas market quickly developed immunity to its provocations

Last week will be remembered for the energy solidarity of the EU countries.

Changes took place first of all in the information space: speakers at various levels began to show confidence in passing the heating season. For example, German Chancellor Olaf Scholz has publicly stated that Germany is ready for future restrictions on Russian gas supply.

Such statements were backed with concrete actions: Scholz, together with his Spanish colleague, launched a project of increasing the capacity of the connector between the Iberian Peninsula and the EU-wide gas network.

After the implementation of this plan, approximately 30% of the European consumers’ needs in natural gas may be covered, using the network of Spanish and Portuguese LNG terminals.

Such an agenda had a positive effect on the expectations of European traders, mitigating fears caused by the Russian propaganda. Therefore, despite the shutdown of Nord Stream-1 and inadequate statements of the Kremlin, gas quotations at the TTF hub (the Netherlands) fell by more than 22% and reached $2,300 per thousand cubic meters.

It is also worth notice that despite the suspension of the Russian gas supply to the French market, quotations there fell by 38%, to $1,400 per thousand cubic meters. Everything shows that the European gas market has quickly developed immunity to Russian provocations and economic sabotage. Therefore, all the "forecasts" of the Russian gas monopolist Gazprom about the spot quotations of blue fuel at a level of $4,000 per thousand cubic meters turned out to be an element of the aggressor’s disinformation campaign.

At the same time, a similar "forecast" is now being spread by the Kremlin regarding Brent oil quotations, claimed to rise to $200 per barrel after the G7 countries introduce a price cap on Russian oil.

In fact, such statements by the aggressor are another soap bubble and an element of information pressure, since Brent is one of the three benchmark grades of oil, while Russian Urals or ESPO is a common grade.

Therefore, if the G7 countries (more than 32% of global demand) introduce a price cap on one of the 23 oil grades, this will not lead to any price rise, because the upward price signal goes from the benchmark to the grade, not vice versa. At most, an increase in price may occur in case of a physical shortage of the resource, i.e. limiting the price of a grade will only lead to a decrease in price through toughening competition for consumers who wish to buy oil with a discount.

Obviously, the Russian Federation understands this and therefore is trying to create a shortage of oil on the global market in order to have the maximum effect on the quotation of benchmark oil grades and, accordingly, formation of the most profitable price cap.

Unfortunately, official Ankara is helping the Russians by raising transport fees for the passage of oil tankers through the Bosphorus and Dardanelles five-fold since October, according to the Turkish Sabah newspaper. Hence, the cost of oil transported by tankers from the Black Sea will grow. So far, the Turkish government has not provided official comments, so the appearance of such information may be seen as a probe into the reaction of the G7 countries.

Along with this, two incidents that happened on the same day (September 1) and led to the stoppage of navigation on the most important sea routes look quite strange. The first one happened with Lady Zehma MV, which was carrying grain from Ukraine and ran aground in the Bosphorus Strait. At the same time, a Singapore-flagged tanker also ran aground and blocked other vessels in the Suez Canal.

As a result, quotations of the Brent benchmark oil rose by 2%, to $93.8 per barrel. A similar case tool place a year ago, when the container ship Ever Given ran aground in the Suez Canal, stopping 24 oil tankers. As a result, Brent prices then rose by 7%, to $65 per barrel, and Russia used the incident to lobby for the so-called Northern Sea Route, as opposed to the Suez Canal.

Therefore, one cannot rule out that the current incidents blocking navigation were man-made, say, to make the Kremlin's threats to the civilised world, voiced by Putin's henchman Dmitri Medvedev, more visual.

One way or another, ship and tanker traffic has been restored, gas prices in the EU are gradually decreasing, and the price cap on Russian oil and petroleum products will be introduced from December 2022.

Generally speaking, it is a check to tyrant Vladimir Putin, whose power rests on oil and gas, television and watch towers.

Source: 

https://razumkov.org.ua/komentari/shakh-tyranu-putinu-iak-kreml-prograie-resursnu-viinu