Tag Archives: USA

The thesis of this video analysis (above) is that the USA, in coordination with its allies, has prepared an unprecedented “Oil War,” as I term it, against the Russian Federation to force either an end to Putin’s war on Ukraine, or the ruin of Russia’s oil sector, the main foundation of its war economy.

It is difficult to consider this to be anything less than an oil war, not merely a new sanctions or tariffs policy. Its aims to “permanently” destroy Russia’s capacity to export oil, should Putin not relent, an objective that the American Secretary of the Interior has persistently lobbied for inside the Trump cabinet.

This oil war has been in preparation, together with allies of NATO, the EU, the Saudis and various OPEC states, for several months, as I explain in detail in the video. In particular, as I endeavor to explain, the objective market balances of the past two or more years — of abundant surplus production capacity being held offline by OPEC and OPEC+, which far exceeds the total seaborn exports of the Russian Federation, taken together with the preeminent position of the USA plus its ally, Saudi Arabia — means that this objective should be very taken seriously.

In my view, media and expert commentary have simply not seen the full sweep of what has been in preparation since perhaps January, and certainly since April.

The media and both geostrategic and oil-sector commentators have been too focused on week-by-week, or even daily perspectives, and fail to consider the Trump administration’s longer term, consistent policy objectives in which these events are situated.

For some perspective, we should recall clearly that Putin, for his part, has twice weaponized the oil or gas prowess of the Russian Federation attempting to impose energy-sector and thereby geostrategic defeats on the USA — and on its European Union/G7 and NATO, Saudis and various OPEC-member allies. Consider:

— First, there was the oil price war of March 2020 – overtly aimed to “destroy” USA shale and, with it, the capacity of the USA to sanction Russian oil and gas.  (See my analyses during those events.)

— Second, there was the weaponization of Europe’s  over-dependence on Russian gas-pipeline exports in parallel to Putin’s full-scale invasion of Ukraine in 2022. This energy war aimed to force Ukraine’s European allies to abandon their solidarity with Ukraine under threat of severe energy shortages and high prices aimed at ruining the European economy. (See my many analyses during those events.)

Both these Russian-initiated energy wars, one in 2020 using oil, the other in 2022 using gas, failed. However, the consequences of the gas war persist in Europe and are still a major contributing factor in its de-industrialization and uncompetitiveness – indeed, the EU victory of 2022 over the Russian gas war may yet prove to be pyrrhic if Europe doesn’t drastically reform its energy policies in a coherent, scientific manner.

So, it is not so surprising that the USA should now lead a counter onslaught, an “oil war” against Russia with the geostrategic goal of forcing Putin to make an acceptable deal to end the Ukraine war.

Should Putin not relent to Trump’s demands to end the war, this USA-led oil-sector policy could, in my estimation (see the video), severely restrict the capacity of the Russian Federation to produce and export oil, and to continue its historical role as one of the three biggest players in the global oil market. This in turn, would ruin the Russian economy and capacity to maintain the current war production.

Putin’s pre-2022 European gas-market dominance (e.g., 40% of all imports were from Russia, and Gazprom owned much of European gas infrastructure) meant that he could weaponize this position to launch a second, energy front against Europe in support of his February 2022 full-scale military invasion of Ukraine.

Many have spoken of USA “energy dominance.” The economic benefits for the USA from the oil and gas fracking revolution have been seen. And, oil remains the world’s most geostrategic resource.

This reality should be taken as seriously, not simply as a trope. As I endeavor to explain in the video, the current particulars of the global oil market (the tech, finance,, resource base, production and spare capacities, and security arrangements of the market-centered, one “global barrel” energy security system, mean that, If the Trump administration and Congress proceed as threatened, the Russian oil sector will face an existential threat to its continuation.

Appendix: Some comments I made on LnkedIn on related issues.

Some argue that the recent EU lowering of the Russian oil price cap is a “big deal.” However, it is not. Here I explain/argue that “the Russian oil-price cap is all a waste of effort.” and that “a devastating, fundamental shift in approach has been prepared.” To wit:

1. The cap hasn’t failed because it is too high. It is a fundamentally ineffective policy. Russia’s shadow fleet is effective as a backdoor to evade the cap, exactly as most people in the oil sector – including me – predicated it would.
2. Russian oil has to be simply taken offline and this enforced via harsh secondary sanctions and/or tariffs. This *should* begin within a week, led by the USA.
3. There has long been plenty of withheld spare supply in OPEC, OPEC+, USA and elsewhere. It was a fundamental fallacy in 2022 that Russian oil needed to be kept online for market stability, and this fallacy/timidness led to the USA’s “novel” price cap fiasco.
4. Only “bone crushing” [Senators Graham (R, SC) & Blumenthal (D, Conn)] oil and gas sanctions can REALLY undermine Russia’s war mchine.
5. This has been Trump’s, his cabinet’s and Congress’ Plan B since January for Putin.
6. I would argue the Saudis et al (Gulf Opec) have been prepping/shaping the global oil market since then for the possibility of an epic, anti-Russian US-led oil-sanctions war.
7. (I suggest looking at how easily the Saudis crushed Putin-Sechin’s oil-price war of March 2020, at GlobalBarrel(dot)com)
8. NOTE Secretary of Interior Burgum has long advocated “destruction” of Russia’s oil sector, Energy Secretary C. Wright speaks positively of scenarios wherein Russian oil exports are replaced by others, including the USA.
9. We’ll know very shortly if Trump sticks to this Plan B for the war in Ukraine.
10. A huge confrontation will result. Russia may retaliate, somehow, in desperation. Infrastructure (Baltic? Atlantic?) and cyber attacks? Battlefield escalations, etc.? Spreading the war? What will China do? Will Putin consider a real “deal”?
11. Trump will again offer Putin, undoubtedly, at some point, inducements to end the war and move away from China towards Western investments, such as a return to oil & gas markets, etc.
12. The Trumpian “grand strategy” is to pull Russia away from China, isolating China but, if not possible, then devastate it’s ally, Russia.
13. This might fail, deepening their alliance. A devestating failure is if a greatly weakened Russia allowed China, which has 1/3 of global manufacturing, to arm Russia as it’s “cats paw.” Xi speaks tough till now on all this, rhetorically backing Russia vs. USA oil & gas sanctions & tariffs.
14. I should add that Ukraine has long been capable of smashing the oil-export infrastructure of Russia’s three big west-facing oil ports. Perhaps it will soon be allowed to do so?

Appendix: Some comments I make on the recent USA-EU tariffs deal (also form LinkedIn):

A key, analytically, is to see that Trump’s numbers should (obviously?) be taken qualitatively, not quantitatively. This implies, then, one should also take them, seriously.

The qualitative aspect here is that Trump has now gotten his ‘ducks’ (I.e., European NATO, EU trade and especially energy, and similarly Japan – “all in a row. This now allows him to transition to his “Plan B” vs. Putin -which will entail a severe energy shock to Russian oil & gas exports, and require an as-smooth-as-possible global oil-market reworking…. while maximally squeezing India & China. Von der Leyen et al are in on all this.

One should take as ominous his immediately cutting Putin’s days before the Western energy sanctions onslaught begins.

This required getting the NATO meeting and the EU & Japan deals done.

PS There is also a sig. Mideast angle here, re. presumed Trump/USA coordination with the Saudis/Gulf on OPEC/OPEC+ pre-shaping of the oil market for the oil-confrontation vs Russia.