Author: Rong ping source: official account: Rong Ping (ID: rongping898) has been authorized to reprint
Just when the European Union decided to impose price limits on Russian oil and gas products, on September 3, Russia announced that it would completely stop the natural gas transportation of the Beixi No. 1 pipeline on the grounds of technical failure. The statement did not mention the exact time of reply. In other words, the interruption of supply may be temporary or permanent, depending on Russia’s mood.
Europe and the United States of course know that the so-called failure is fake, and it is true that it is stuck in the neck of European energy.
But what if I knew?
The ultimate pressure game is to bet on who has the stronger resistance to pressure!
Europe is betting that as the largest export market of Russian natural gas, the Kremlin dare not take the strategic risk of heavy loss of export share. If it takes the risk, it will be unable to maintain the war in Ukraine due to lack of sufficient fiscal revenue, thus forcing Putin to lose all the time;
Russia is betting that Europe’s dependence on Russian gas is very strong. After the power supply is cut off, it can’t find an alternative to Russia. If it can’t find an alternative, Europe’s people’s livelihood and industry will inevitably collapse.
In this game of who blinks first and who loses first, Russia’s winning side is obviously much larger than that of Europe.
Strategic oil leakage of Beixi No.1 turbine
Russia’s oil and gas resources are not without users.
After the outbreak of the war in Ukraine, under the pressure of us and European sanctions, Russia’s oil and gas export revenue still increased by nearly 20% against the trend, making a net income of US $800 million for the Kremlin every day, up more than 50% year-on-year, the highest level since the global financial crisis in 2008.
On August 18, the Russian Economic Department issued an evaluation report. The document shows that Russia’s energy export revenue last year was 125 billion US dollars. If the current situation is maintained, Russia’s energy export revenue this year will increase by 300%, reaching 337.5 billion US dollars, the highest in history!
This report fully takes into account the situation of Russia Europe energy decoupling: on the one hand, Russia can compensate for the losses of the European market by increasing its supply to China and India.
On the other hand, the global energy supply shortage caused by high international commodity prices and Western sanctions against Russia will be the norm, and no one can transfer new increments to Europe. Therefore, Russia can fully export oil and natural gas to Europe at higher prices through the channels of India and other third-party countries.
From February 24 to mid April, when the Russian Ukrainian war broke out, India imported as much as 13 million barrels of crude oil from Russia in a short period of 40 days, while only 16 million barrels were imported in 2021, obviously exceeding India’s digestion capacity. After investigation by the US financial institution in charge of sanctions, it was found that more than half of the oil was sold back to Europe after rough processing in India.
In addition, the reaction of the financial market also indirectly proves Russia’s dominant position in this extreme stress test.
The only turbine in operation of the Beixi No. 1 pipeline was shut down for overhaul on August 31. The original planned overhaul time was three days. During this period, Gazprom’s share price soared 32% in succession. This shows that the capital market is convinced that Russian oil and gas products are more scarce and rigid than the so-called largest natural gas market in Europe.
In a word, Russia’s oil and gas can still thrive without leaving the European market, but Europe can’t.
This is indeed the case!
I won’t say much about Europe’s dependence on Russian natural gas. On the contrary, except for France, Britain and a few other Western European countries, they are basically above 35%. Among the big countries, Italy and Germany are the most, Italy’s dependence is 46%, and Germany’s is 50%.
Last year, the daily flow of natural gas from Russia to Europe was about 304 million cubic meters, of which 167 million cubic meters were borne by the Beixi No. 1 pipeline, accounting for about 53%. Before the strategic failure of the turbine, the pipeline maintained a minimum supply of 20%, that is, 33 million cubic meters per day. Coupled with the impact of European and American sanctions, the gas transmission capacity of the non Beixi 1 pipeline has dropped to 27 million cubic meters.
At present, the total amount of natural gas supplied by Russia to Europe is only 60 million cubic meters, less than one fifth of last year. If Beixi line 1 is cut off in an all-round way, the average daily natural gas available in Europe will be only 27 million cubic meters, and the total gap will reach 277 million cubic meters, which is no different from the energy shutdown, and this is still based on the condition that Russia does not expand the scope of power supply interruption.
Russian gas pipeline to Europe
Russo gas accounts for 46% of the EU’s imports and 40% of its usage. It is its largest supplier. If Russia completely cuts off its supply, it will also be cut off. No country can fill this gap. At present, the total natural gas reserves in Europe are about 72.8 billion cubic meters, and the scattered use of coal-based natural gas and imported liquefied natural gas can make up to 200 billion cubic meters at most, but this is obviously not enough.
Under the La Nina effect this winter, it is expected that the average temperature will be lower than usual, and the heating consumption of residents will definitely increase dramatically.
At best, Europeans are highly aware and will implement the government’s 15% gas saving initiative, which can last for about two and a half months based on the average daily gas consumption of 2.55 billion cubic meters. At worst, if we increase by 50% on the basis of the usual 3 billion cubic meters, we can only last for one and a half months.
In other words, no matter what the outcome, Europe’s natural gas reserves are unlikely to last until the end of this winter.
What’s the price of not holding out?
Natural gas is an important raw material for industrial production and power generation in Europe, and it is also something that residents must use in their daily life in winter. There is a large gap in natural gas. According to the economic principle that commodity supply is less than demand and prices rise in the supply-demand relationship, inflation in Europe will further escalate. In August this year, Germany’s one-year electricity price was reported at 322.5 euros, with an increase of 10% per megawatt hour and an inflation rate of 7.95%, breaking 7 for five consecutive months!
Some think tanks point out that if the energy supply crisis is not resolved, the German government will have to choose between industrial gas and residential gas when winter comes. Although it looks miserable, this is actually the best result for Germany. The worst result will naturally be that Russia will completely cut off the supply of gas, and neither industrial nor residential gas can be guaranteed.
The winter in Europe is almost as cold as that in northern China, and the residents will not die because of lack of gas. The key is that the European people are used to living a good life. As the saying goes, it’s easy to move from thrift to luxury and difficult to move from luxury to thrift. They will certainly pour their anger on the German government after a warm winter. Schultz’s support rate is worrying.
Washington Post: winter is coming in Europe
Industrial gas shortage is a big problem. A number of enterprises in Germany have stopped production because of gas shortage. When the Russian gas supply is cut off, the shutdown storm will soon sweep across the country. Made in Germany is only the best, but it doesn’t mean that other countries can’t. Japan, the United States and China can do many things. German enterprises can’t deliver goods on time. Even if the downstream cooperative manufacturers are no longer willing, they must change their suppliers.
Changing suppliers involves a lot of things, from quality standard review to industrial integration, which requires a lot of time and money to adapt and adjust. This means that once the downstream manufacturers change their supply, it is extremely difficult for German and other European enterprises that rely on gas energy production to kill back.
This is the answer to why BASF, a German chemical giant, is still spending 10 billion euros to expand its Zhanjiang plant despite the German government’s attempts to tighten investment in China!
It is not hard to predict that with the approaching crisis of energy supply interruption, more European enterprises, especially German enterprises with the largest proportion of gas production, will expand overseas factories one after another in order to stabilize production tasks. China, with stable energy supply and complete infrastructure, will certainly be the preferred place.
Let’s get down to business. At this critical juncture, a beautiful boy came on stage.
On September 1, local time, when presiding over the annual meeting of French foreign envoys at the Elysee Palace, the president of France said that France should always adhere to the principle of independent diplomacy, not choose sides, nor be a vassal of any major country. He also stressed in particular that there is no logic of confrontation between France and China in the Asia Pacific region.
In a simple translation, not choosing sides means not choosing sides between China and the United States, and not being a vassal of any big country obviously means not being a vassal of the United States. After all, China does not have the motivation and strength to make France its vassal, and there is no logic of confrontation, which means that there is no motivation for confrontation and conflict utilization. In this case, it will not engage in confrontation with China in the Indo Pacific region.
It is obvious that macron’s statement is intended to show goodwill to China.
Introducing NATO forces into the Indo Pacific region and strengthening the militarization of the region to contain China is one of the geostrategic goals planned by the United States against China in recent years. France is the key to this big game. First of all, France has seven overseas territories and 1.5 million citizens in the Indo Pacific region. The existence of sovereign interests is conducive to the United States to leverage its internal forces against China; Secondly, France is one of the political and military leaders in Europe. Inciting confrontation in the law can, to a certain extent, split this confrontation into confrontation between China and Europe.
From China’s perspective, France is the core member of the second circle of the western group, and breaking with the United States is not realistic. Therefore, macron has promised not to be a vassal of the United States and not to participate in containing China in the Indo Pacific region, which is quite sincere.
Moreover, this is not the first time macron has released a message of goodwill. On August 28, Kyodo News Agency reported that French President macron planned to give up attending the state funeral of former Japanese Prime Minister Shinzo Abe because of the internal affairs schedule, and the French representative might be former President Sarkozy or Hollande.
It is reported that macron originally intended to attend Abe’s state funeral, but now he suddenly gave up, which shows that something happened in the middle of it that made him change his mind temporarily.
When you think of his speech at the annual meeting of foreign envoys, the answer is coming!
We should know that Shinzo Abe is an important figure in promoting the militarization of the US Indo Pacific strategy and the Anti China mechanism of the United States, India, Japan and Australia. And the Yasuda cabinet has the intention of using Abe’s state funeral to win over the Western bloc to confront China. Isn’t macron finding it uncomfortable for China?
Here comes the question. How does France’s desperate efforts to show goodwill to China have to do with the current energy crisis in Europe?
This will start with the internal struggle between France and Germany!
It is true that France and Germany are working together to promote European integration, but privately, the two countries often fight with each other in order to compete for the position of No. 1 in the EU.
Legally speaking, France is a permanent member of the Security Council that legally possesses nuclear weapons. It also has world-class defense and military industries and armed forces. It has a much bigger chance of winning than Germany, the defeated country. No one expected that Germany, which has a poor hand, has completed the most impressive reversal in European history by relying on the cooperation of the two presidents Schroeder and Merkel.
A series of reforms during Schroeder’s administration were the key to Germany’s stability as a European economic locomotive. In the first two decades of this century, when peaceful development was the mainstream of the world, the international influence conferred by industrial economy was far greater than that of military and national defense.
In short, whoever has stronger economic strength will have greater international influence. This is also the fundamental reason why Japan’s influence in Southeast Asia was stronger than China’s.
After Merkel came to power, on the basis of consolidating Schroeder’s economic reform, she thoroughly established Germany’s leadership position in Europe through two things: one is that she stood up and properly solved the crisis of survival in the European Union many times, such as the Greek debt storm that year, which made Merkel lift Germany to a height that should not belong to her by virtue of her political reputation accumulated in Europe. The other is to build a German Russian Energy Union, with Germany as the transit station for Russian natural gas to Europe, so as to help Berlin gain the dominant power of European energy supply.
It’s not that France has never thought of using the energy card to win back a city, but Merkel’s ingenious plan blocked the way.
The 16 years of Merkel’s administration are the 16 years of the rapid rise of extreme environmental protection organizations. When Merkel came to power in 2005, the influence of extreme environmental protection organizations was limited to the private sector; When Merkel steps down in 2021, they have become the representatives of the third largest political party and radicals in German politics.
Therefore, some people think that Merkel should be responsible for this, but unexpectedly, the rise of extreme environmental protection organizations is precisely the result of Merkel’s intentional indulgence, and its purpose is to drive the tiger and swallow the wolf!
The tiger is naturally an extreme environmental protection organization. Who is the wolf?
French nuclear power!
The concept of new energy and environmental protection was put forward by Europe. At that time, coal-fired power was put on the agenda long ago as the largest sector of carbon emissions. As an alternative, France advocated vigorously developing nuclear power and Germany advocated vigorously developing gas-fired power.
In terms of application, the prospect of gas-fired power generation is certainly not as good as that of nuclear power, because gas-fired power generation needs to import a large amount of natural gas from abroad, which is easy to be blocked by suppliers; As for uranium, the raw material of nuclear power, in Africa controlled by France, there is no risk of power cut-off. Moreover, the comprehensive power generation cost of nuclear power is low and sustainable, which is very consistent with the high-intensity production activities of high-end manufacturing industry in Europe!
Germany knew that it had little chance of winning, so it took advantage of extreme environmental protection organizations to launch a massive anti nuclear movement in Europe on the grounds that nuclear power development would pollute and destroy the environment. So far, many European countries, including Germany, have announced the phasing out or legislative prohibition of nuclear power. Even if some countries have not reached this stage, the threshold for new nuclear power has been raised.
This time, Germany won!
However, the sudden Russian Ukrainian war has completely shattered Germany’s dream of using energy to make princes. Today’s Europe is deeply involved in an energy crisis. It has not handled Russia Europe relations well, nor has it solved Russia’s security demands on the Ukraine issue. Even Germany, which has helped the United States, should bear more than half of the political responsibility.
For France, this is a once-in-a-lifetime opportunity!
On the one hand, the continuous and serious deterioration of the security situation in Europe has made the international influence conferred by military and national defense a decisive force leading the geopolitical trend. On the other hand, in the post Russian Ukrainian war era, a major adjustment of Europe’s energy structure to reduce the damage caused by Russia’s power cut-off is imminent.
Coal power is too polluting, which can be used to rescue emergencies and treat symptoms, but can not cure the root cause; Wind power photovoltaic is not very stable; Hydropower also lacks a good water conservancy environment, and the only feasible alternative is nuclear power.
France’s nuclear power is the first in the world in terms of technology and industry. It is easy to supply a large area of nuclear power to Europe after expansion. But before that, France must solve a problem: the problem of trans regional power transmission under long-distance and complex meteorological and geographical conditions.
The EU covers an area of more than 4 million square kilometers, involving three major climates of temperate marine and continental Mediterranean, and four landforms of plateau, plain, mountain and hill. If an ordinary power grid is used, a large amount of power will be lost during transmission, which is extremely unfavorable to system stability. What can really solve the transmission end problem once and for all is China’s UHV transmission technology.
This is the reason why France has suddenly shown goodwill to China!
70000 people took to the streets in the Czech capital to protest against soaring energy prices
The Russian Ukrainian war was a major event that changed the international political ecology after the cold war. In Europe, the building in Germany collapsed. It is France’s turn to build a high-rise building to entertain guests!