Thread: Economic sanctions

Originally Posted by sabang

Wow, German FDI up 95%. UK up 40%. Who are they supporting in this war? Or is it just about the survival of their reeling economies?

Your post made about 10 hours ago? Could it be that your stupid is being ignored again? Hope this helps.

See post #909 above, to check on my 'stupid'.

Originally Posted by sabang

See post #909 above, to check on my 'stupid'.

Yes, your dependence on state propaganda does prove you're stupid.

But of course your unquestioning dependence on MSM doesn't, oh Seeker of the Lost WMD.

Originally Posted by sabang

But of course your unquestioning dependence on MSM doesn't, oh Seeker of the Lost WMD.

Like most idiots that run around relying on blogs for "information", you don't actually even know what "MSM" is.

Anything that doesn't fit into your cretinous, myopic view is "MSM".

Then go find those WMD. Like a good dawgy.

China is snapping up Russian oil at the steepest discount in months as EU scrambles to keep a lid on Moscow's energy income


Jennifer Sor
Dec 8, 2022, 3:29 AM

• China is purchasing Russian crude at the steepest discounts in months, Reuters reported.
• Four traders familiar with the matter said at least one refinery purchased crude for as low as $68 a barrel.
• "They don't really care about the price cap. All they do is crunch the numbers to see if the delivered prices make good profit or not."

As the European Union scrambles to keep a lid on Moscow's energy income, China is snapping up Russian oil at the steepest discount in months, traders familiar with the matter told Reuters on Wednesday.

At least one December-arrival cargo Russian ESPO light crude was sold at a discount of up to $6 per barrel compared to the benchmark price for Brent, four traders told the news outlet, implying a price of $68 a barrel.

And some January-loading cargoes were sold at a $4-per-barrel discount, the most since July, according to Reuters.

While China has said it won't abide by the price cap on Russian oil that the G7 and EU imposed, it could give Moscow's customers more bargaining power in oil deals, according to analysts from Rystad Energy in a recent note.But for now, sources told Reuters that China-Russia oil traders were doing business as usual.

The steeper discounts are coming amid fears about Chinese demand as strict zero-COVID policies have curbed economic activity, though Beijing has signaled some loosening. Reuters also reported that Chinese refiners are seeing weaker margins.

"They don't really care about the price cap. All they do is crunch the numbers to see if the delivered prices make good profit or not," one executive at a refinery told the news outlet.

Russia has rejected the price cap and threatened to retaliate against the measure, such as by slashing its crude supplies to participating countries, implementing a price floor, or enforcing maximum discounts on its crude.

But Vanda Insights has said the cap is unlikely to make a meaningful impact on Russia's profits,

https://markets.businessinsider.com/...eu-ban-2022-12

Oh, but it's the principle that counts. Happy Christmas Europe, from uncle sam.

China is snapping up Russian oil at the steepest discount in months

Yes, we know Putin is desperate.

Immediately after the Russian invasion of Ukraine in February 2022, the U.S., the UK, and the EU placed major sanctions on Russia to constrict its economy and restrain its war effort. Having been updated several times since, these sanctions have compounded the effects of the previous sanctions placed on Russia in 2014 after it annexed Crimea.

The Russian “economy contracted for the second quarter in a row,” according to a November 16 article in the Financial Times, which attributed this downturn to the Western sanctions. Undermining the sanctions through a variety of methods, including cooperating with other countries with sanctions evasion experience, has become an even greater priority for the Kremlin.

Russia has decades of history in helping other countries evade sanctions. In recent years, Russia has exported oil to North Korea and employed its laborers in Siberia in violation of international sanctions, while Russian entities have also been sanctioned for aiding North Korea’s weapons programs.

The Kremlin is now calling in its own favors. Weeks after North Korea and Russia pledged “to strengthen ties” in August 2022, North Korea is believed to have supplied Russia with millions of rockets and artillery shells, undermining Western attempts to isolate the Russian military-industrial complex.

Using North Korean laborers to help rebuild Donetsk and Luhansk—Russian-supported eastern Ukraine breakaway republics—has also been proposed. Additionally, Moscow has recently shown greater enthusiasm toward cryptocurrencies to evade sanctions, and may also look to emulate North Korea by mining bitcoin to increase its access to fiat currencies and facilitate underground trade.

Iran has faced heavy Western sanctions since 1979, aimed at restricting its economy and curbing its weapons programs. In November, Iran was suspected of asking Russia for aid with nuclear energy materials, which could significantly shorten the “breakout time” needed to create a nuclear weapon.

Russia will likely acquiesce, having received significant drone and missile shipments from Iran since September. With the “price cap on Russian seaborne oil” coming into effect from December 5 (and the ban on most petroleum products expected to take place by February 5, 2023), Iran’s assistance in evading oil sanctions will be greatly appreciated in Moscow.

Iranian oil exports, for example, plummeted by 90 percent following the reintroduction of sanctions after former President Donald Trump’s administration pulled out from the Iran nuclear deal, the Joint Comprehensive Plan of Action, in 2018. However, a mix of tactics has allowed Iranian oil exports to rebound in the years since.

These included sanctioned ship-to-unsanctioned ship transfers, changing ship names and other identification markers to disguise Iranian oil tankers, turning off Automatic Identification Systems to make sanctioned ships completely vanish off the radar, and blending Iranian oil with bulk cargoes from other countries to disguise its origin.

Oil giant Shell faced criticism in April for undermining sanctions by purchasing “Latvian blend” oil, almost half of which (49 percent) originated from Russia. The UK has also received hundreds of millions of dollars of Russian oil since its invasion of Ukraine, even as some of this oil “was registered as imports from Germany, Belgium, and the Netherlands.”

Russian and Iranian officials have also discussed using Iran as a “backdoor” to allow Russian oil products to enter global markets, which will become easier should a renewed nuclear deal between Iran and Western states go through.

Russian entities have similarly shown effectiveness in getting sanctioned Venezuelan oil to global markets in recent years. After Russian oil giant Rosneft was sanctioned in 2020 for doing so, the Kremlin quickly created a new oil company, Roszarubezhneft, to continue operations after Rosneft left Venezuela.

With Russian assistance, Venezuela’s oil exports doubled from December 2020 to December 2021, finding many other facilitators and buyers in the global market. In 2021, the U.S. Treasury sanctioned several European oil traders who were working with a Mexican network that was shipping Venezuelan oil to companies in China, Indonesia, and other countries in Southeast Asia.

Creating shell companies has also historically blunted the effectiveness of sanctions. Syrian officials have created countless shell companies to blur ownership of economic assets in recent years, and Iranian clearing houses and foreign-registered front companies have conducted tens of billions of dollars in sanctions-evading trade annually, according to Politico.

Western banks, like Germany’s Commerzbank AG and Deutsche Bank AG, and the U.S.’ Citigroup, often unknowingly, helped Iran conduct underground export transactions and may face Russian attempts to use these banks to facilitate similar transactions—“either wittingly or unwittingly.” Russian oligarchs also have plenty of connections to Western financial actors and the ability to expand their economic empires in other countries.

Nonetheless, the ambitious Russian oil price cap that has been introduced on December 5 has worried some in Moscow as “About 95 percent of the world’s tanker liability coverage is arranged through a City of London-based insurance organization called the International Group of Protection and Indemnity Clubs.” Russia will struggle to export large volumes of oil without the insurance coverage required to secure its transport options, and Western officials hope Moscow will accept shipping oil at a reduced price rather than find other alternatives.

Lifelines, however, exist for the Kremlin. Former Russian President Dmitry Medvedev stated in June 2022 that the Russian government would “replace commercial insurance and reinsurance cover of oil exports by sea and the vessels that carry them in a bid to counter the European Union ban on companies providing services.” This would be similar to the measures the Japanese government took in 2012 when it provided “a sovereign guarantee of up to $7.6 billion in liability for a tanker carrying Iranian oil” to maintain trade with the country.

Additionally, “There are probably insurers in Russia capable of writing third party liability and reinsurance programs that could then be backed by a sovereign fund from China or Russia,” according to Mike Salthouse, chairman of the International Group’s sanctions subcommittee.

Indian companies also agreed to certify Russian tankers in June, raising suggestions of “a non-Western fleet with sovereign Russian or Chinese insurance and financing, and Indian certifications for the vessels.” Shipping companies and maritime services based in India, China, and the Arabian Gulf would be essential for Russia to successfully achieve this.

Russia is also using former Soviet states to bypass sanctions. In May, Ukraine accused Georgia, Armenia, and Azerbaijan of helping Russia reexport its products to international markets after more than 200 companies were established and tens of thousands of Russians settled in these countries in the months after the February invasion.

Smuggling routes through Central Asia have historically facilitated the northern drug trade route to Europe. But these routes have also allowed Central Asian states to emerge as integral entry points for Western technology sought by Russia in recent months, including microcircuits and semiconductors.

Five Russian nationals were charged with sanctions evasion in October for shipping military technologies, including semiconductors, radars, satellites, and other equipment, from U.S. manufacturers to Russia. Tens of millions of dollars were spent to supply U.S.-origin technologies for use in Russian fighter aircraft, missile systems, smart munitions, and other systems. The deals were facilitated through a mix of real and fake companies and falsified documents, while cryptocurrencies were used for the transactions and to launder the proceeds afterward.

Three Latvian and Ukrainian nationals were also charged in October for attempting to ship U.S. technology for use in Russia’s nuclear and defense industries, in violation of U.S. export controls. Though unsuccessful, the brazenness of Russian networks attempting to penetrate the U.S. points to greater success in other countries with higher bribery rates and laxer inspection policies.

Isolating Russia will also require the assistance of other major economic centers. But China has received resources from Iran, Venezuela, and North Korea in recent years in violation of U.S. sanctions, and is already pursuing the same policies with Russia. Small refiners in China are able to ignore the risk of U.S. penalties since they are “hard to reach with sanctions,” according to Anders Corr, founder of Corr Analytics.

Beijing will also look to use Russia’s isolation to increase Eurasian trade through its Belt and Road Initiative, as well as use other economic mechanisms to undermine traditional U.S. dominance. After Russian banks were blacklisted from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) payment-verification system, China and Russia have taken greater steps to develop their own alternatives.

This includes Russia’s System for Transfer of Financial Messages (SPFS) and the National Payment Card System (now known as Mir), as well as China’s Cross-Border Interbank Payment System (CIPS) and UnionPay.

In July, India set up a framework to conduct international trade in rupees. Vostro accounts required to facilitate this trade have been opened by Russia’s Gazprombank (with India’s UCO Bank), VTB Bank, and Sberbank, with six more Russian banks in talks to do so. A major gas pipeline deal with Pakistan, an agreement to use local currencies in trade with Egypt, and increased energy exports to Brazil in recent months have further demonstrated Russia’s attempts to diversify its economic options.

Russia’s economy will continue to face significant hurdles, particularly with the imposition of the oil price cap. While U.S. officials have stated that the aim of sanctions is to change Moscow’s behavior, Russia and other countries may double down on developing rival official trade mechanisms to the West and expanding a globalized black market with other rogue states.

https://www.counterpunch.org/2022/12...mic-sanctions/

Russia’s seaborne crude shipments collapsed in the first full week of Group of Seven sanctions targeting Moscow’s petroleum revenues, a potential source of alarm for governments around the world seeking to avoid disruption to the nation’s giant export program.

Some of the plunge was exaggerated by work at a port in the Baltic that’s now finished, but there also appeared to be a shortage of ship owners willing to carry key cargoes from an export facility in Asia. Several other ports also showed week-on-week declines. The data must be treated carefully, because weekly flows are at the mercy of the timing of cargo scheduling, the weather, and even the quality of signals that the vessels themselves transmit.

European Union sanctions that began on Dec. 5 are designed to curb Russia’s revenue from oil. On one hand, the bloc stopped buying but it also barred the provision of key services to enable the oil to be moved. The US, alarmed at the severity of the measures, pushed for the measures to be softened with the implementation of a price cap, keeping those things — especially insurance — available for buyers elsewhere in the world when traders paid $60 a barrel or less for Russian oil.

But in the first full week after the EU ban on seaborne Russian crude imports came into effect, total volumes shipped from the nation dropped by 1.86 million barrels a day, or 54%, to 1.6 million. A less volatile four-week average also plunged, setting a new low for the year. Baltic Sea volumes should recover with work now ended, but the issues in the East may take longer to solve.

Maintenance at the key port of Primorsk cut shipments there to just three cargoes in the week to Dec. 16, down from a more normal weekly loading rate of about eight.

In the Pacific, though, flows of ESPO crude — named after a pipeline bringing the oil from Siberia — from the port of Kozmino appear to have plunged, with just two tankers loading in the week to Dec. 16. That’s down from an average of eight a week over the past three months. At least two major tanker owners have withdrawn their ships from the route, with ESPO crude selling at prices above the $60 a barrel cap set by the G7. Carrying cargoes that were bought above the cap would deprive the vessels of internationally-recognized insurance.

The flow from Kozmino will recover, at least partially, in the week to Dec. 23, with three ships already loaded and two more berthed half way through the period. But, with a smaller fleet of ships available, volumes could remain erratic.

The EU’s ban on imports of Russian crude by sea that came into force on Dec. 5 closed off Moscow’s closest oil market, which took roughly half the country’s supplies at the start of the year. With the exception of a small volume delivered to Bulgaria, seaborne flows of Russian crude to the bloc halted in full, as planned.


The ban, along with the associated price cap, created difficulties for shippers seeking to move crude from the Black Sea to the Mediterranean, with Turkey demanding specific confirmation of insurance before allowing ships to transit the Bosphorus and Dardanelles.

Insurers were initially reluctant to provide the letters requested by Ankara, leading to long delays for ships seeking to enter the Turkish Straits, which also caught up tankers carrying Kazakhstan’s crude, including CPC Blend, which is explicitly exempt from sanctions. The backlog of ships began to clear after a standoff between insurers and the Turkish authorities appeared to be resolved.

There have also been complications between how Russian oil trades in the real world and the practicalities of the price cap, making some traders wary. The distances involved in transporting oil to Asia from Russia’s western ports drove up freight costs, forcing prices of the nation’s flagship Urals grade to slump below the cap.

The volume of crude on vessels heading to China, India and Turkey, the three countries that have emerged as the only significant buyers of displaced Russian supplies, plus the quantities on ships that are yet to show a final destination, fell in the four weeks to Dec. 16 to average 2.53 million barrels a day. While that’s more than four times as high as the volume shipped in the four weeks immediately prior to Russia’s invasion of Ukraine in late February, it is the first time in five weeks that the amount has fallen. Inflows to the Kremlin's war chest also slumped.

Full article with graphs...

https://www.bloomberg.com/news/artic...anctions-began

According to the results of the outgoing year, Turkey confidently overtakes each of the EU countries in terms of exports to the Russian Federation. These results are indicated by official data from the Turkish Institute of Statistics.

Already in September, the volume of deliveries of goods from Turkey to Russia exceeded the monthly record by 21% and, in monetary terms, reached $1,15 billion. Thus, the only NATO country that has not joined the anti-Russian sanctions ranks third in the Russian export market after China and Belarus.

By not supporting its colleagues in the North Atlantic alliance in the sanctions policy, Turkey is one of the main channels for the supply of goods to the Russian market, including bypassing restrictions. Compared to the pre-sanctions period, the volume of Turkish exports increased by 2,4 times. Back in 2021, Turkey was in only 11th place among the exporting countries in the Russian Federation, leaving behind the USA, France, Japan, Poland, and Italy.


FULL- Just a moment...


Surprise surprise.

As rouble falls, claims that Russian banks refusing to allow customers to withdraw their money


Russian banks are allegedly refusing to allow customers to withdraw their money as the value of the rouble falls sharply.

Online reports claim that Russian banks are refusing to allow customers to withdraw money from their accounts. There have been suggestions that Vladimir Putin ordered the funds to be frozen in order for the money to be available for his regime’s use. Video footage posted on social media showed angry people purportedly queuing to take money out.

Alexei Zabotkin, the Deputy Chairman of the Central Bank (CB) of the Russian Federation, during an interview with RBC – due to be published on December 27 – confirmed the drop in the value of Russian currency.

According to Zabotkin, the rate “is fluctuating in the range that has been observed since about the end of May this year. There is a deterioration in external conditions and a decline in oil prices. This is a weighty enough reason for the exchange rate to weaken somewhat”, he admitted.

Every 10 per cent movement in the exchange rate will raise inflation by 0.5-0.6 per cent he pointed out. “But at the same time, with the proviso that these 0.5-0.6 per cent drops are not realised instantly, but are stretched over time for 6–12 months”, added the deputy chairman of the Central Bank.

Since December 5, the EU embargo on oil from Russia came into effect, setting a maximum ceiling of $60 per barrel. Last week, the exchange rates of major currencies on the Russian market updated multi-month highs.

The Russian national currency weakened by almost 20 per cent against the dollar and the euro. Anton Siluanov, the head of the Ministry of Finance blamed the fall of the rouble on the growth of imports.

In the week from December 12 to 16, the rouble weakened from 62.8 to 64.65 against the dollar and from 66.37 to 69.1 against the euro. Then, in the week of December 19, the fall of the rouble accelerated.

On the first day of trading on the stock exchange after the weekend, the Russian currency passed two critical levels – at 65 and 67 roubles to the US dollar. Finally, on December 21, it passed the mark of 70 roubles per dollar and 75 roubles for the euro. On December 26, the rouble is trading at around 68.2 roubles per dollar and 72.4 roubles for the euro, as reported by kommersant.ru.

As rouble falls Russian banks refusing customers withdraw money

They are more interested in joining the SCO. Looking towards the future, not the past.

Originally Posted by panama hat

You are so full of crap . . . provide some evidence, thanks. Will millions of Turks then go to China or Russia to work?

Evidence of their being 'more interested'.

Should probably be in the "Brave New World" thread as well. Your organisation is a joke if you are celebrating "welcoming" a shithole police state like Iran to the fold.

GIYF- "Turkey SCO". Surely that isn't beyond you juniors?

Originally Posted by sabang

GIYF- "Turkey SCO". Surely that isn't beyond you juniors?

This was before the war. Turkey could give two fucks about Russia.

I would prefer to ask a Turk that question. Meanwhile, Turkey now exports more to Russia than any other European nation. Quite a change.

Originally Posted by sabang

Meanwhile, Turkey now exports more to Russia than any other European nation. Quite a change.

Russia is a broken nation. They have no money.

I suppose I could show you Russia's soaring current account surplus, and the fact that life goes on in Russia as normal, and supermarket shelves certainly are not bare- but what's the point? Done before, so everyone but the buffoons already know. Perhaps Ivan misses his Happy meal, perhaps not.

You have a lot a humiliation coming.

A'ww gee, now how many times have I heard that before, and for how long? Still waiting for Hell to freeze over?

The crap falls down.

Originally Posted by sabang

I suppose I could show you Russia's soaring current account surplus, and the fact that life goes on in Russia as normal, and supermarket shelves certainly are not bare- but what's the point? Done before, so everyone but the buffoons already know. Perhaps Ivan misses his Happy meal, perhaps not.

You could but all that would do is show how silly you are.

"The factor that will significantly and radically worsen the situation next year is mobilisation," Evgeniy Nadorshin, chief economist at PF Capital, said at a debt market conference.
Russia's economy is doomed to see a fall in productivity, with consumption and investments also expected to drop, Nadorshin said, predicting a 5-10% economic contraction in 2023.

"We are dealing at best with the second toughest crisis in the 21st century," he added. "Domestic consumption and GDP are being set back by 10 years or more and I don't see any prospects for growth after the recession ends."

https://www.reuters.com/markets/europe/soaring-current-account-surplus-fails-cover-up-cracks-russian-economy-2022-12-09/

Well, that is certainly less than the 16% contraction they were forecasting for 2022. Guess we'll just have to wait and see if this forecast is more accurate, or equally as abysmal.