Is Russia Preparing A Gas Nuclear Option?

Please read this piece by my colleague Paul Roderick Gregory published by Forbes

Vladimir Putin is noted for taking surprise action, which confronts his victims with a fait accompli. They must then either accept the new unfavorable status quo or react in a way that they would consider too risky. Putin has employed this playbook in Georgia, Crimea, East Ukraine, Syria, on Ukrainian naval vessels in the Black Sea and to prop up the Maduro regime in Venezuela.

Putin’s potential targets should put themselves inside Putin’s head to anticipate his next hostile move in order to avoid again being caught off guard with few good options.

Putin loves the unexpected; so beware. On paper, this would be the worst time for Russia to act up in its European gas market. Russia’s Gazprom just narrowly saved its key project – the undersea Nord Stream 2 pipeline directly to Germany – despite almost universal opposition in Europe. Gazprom faces new unfavorable (unacceptable) regulations: On April 5, 2019, The European Parliament and European Commission adopted a new gas directive that requires Gazprom to unbundle delivery from production. Moreover, Germany’s Angela Merkel has promised Ukraine that, Nord Stream 2 or not, Russian gas will continue to flow through Ukraine. That’s not all: With the threat of competition from American LNG, Russia would strive to emphasize the reliability of its deliveries to its massive European market. Finally, LNG competition would surely constrain Putin from taking hostile action that jeopardizes Russia’s European gas revenues.

Read the full article here.

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