We have touched on the Iran war and how much of it has unfolded. The sanctions that exist have also been examined. Clearly there is a seismic shift coming in the world of oil sanctions. Venezuela is no longer a pariah state. Their oil is now selling on the world market and being paid for in petrodollars.
Iran’s oil will follow if the regime is ousted. This would mean a more open market for oil which would stabilize prices and bring greater stability to the world’s economics.
Scott Bessent has temporarily lifted the sanctions on the sale of Russian oil to India. Recently Vladimir Putin said Russia remains prepared to resume large-scale oil and gas cooperation with European buyers under long-term agreements.
Putin made it clear that Moscow has never closed the door on Europe. Instead, he suggested it was European political decisions that cut the continent off from Russian hydrocarbons.
Putin:
“If European companies and European buyers suddenly decide to reorient themselves and provide us with long-term, sustainable cooperation, free from political pressures, free from political pressures, then yes, we’ve never refused it. We’re ready to work with Europeans too. But we need some signals from them that they’re ready and willing to work with us and will ensure this sustainability and stability,”
Of course, there is a major fly in the ointment. The EU intends to introduce additional restrictions on the purchase of Russian hydrocarbons, including liquefied natural gas, starting on April 25th of this year, and could even completely ban such supplies in 2027.
Putin indicated that the Russian government has been entrusted with the mission of assessing the feasibility and advisability of suspending energy supplies to the European market.
“Instead of waiting for the door to be slammed in our faces, we must act now, diverting these volumes from the European market to more attractive destinations and, most importantly, strengthening our presence there,” he explained, referring to those markets where there is stable demand and solid long-term relationships.
Clearly there is a major reset going on in the energy world. Just how might this affect the situation in Ukraine? Putin’s comments certainly leave the way open for some kind of end to the hostilities through stable and well thought out negotiations.
If Trump cuts a deal that lifts Russian oil sanctions in exchange for a peace agreement (or even just Russian non-interference in Iran), the green-sweatshirted former comedian in Kiev gets dragged to the negotiating table whether he likes it or not.
Zelenskyy will come up with some ridiculous argument probably spouting things like the “end of democracy” and other such BS. However, how is Zelenskyy going to compete with the Administration saying that lifting sanctions will stabilize the global economy and help win the Iran war? That’s a losing hand politically.
Jeff Childers:
This explains why President Trump has been publicly squeezing Zelensky so hard. Three days ago, Politico reported that Trump said, “It’s incredible that Zelensky is an obstacle to an agreement… He already had no cards, and now he has even fewer.” Two days before that, Trump called Zelensky the “P.T. Barnum” of Ukraine— referencing how he’d conned the Cabbage into trading hundreds of billions in US weapons for nothing.
In other words, Trump was pre-weakening Zelensky’s negotiating position before offering Russia the sanctions-relief carrot. By the time an oil deal with Moscow materializes, Zelensky has been pre-positioned as the guy who’s being unreasonable, not any sympathetic underdog.
All of this bears watching. Europe is caught between elite politicians who live inside a bubble and a populace that is getting more and more restive as companies flee to other parts of the world where the ability to exist is cheaper. Volkswagen, Germany’s iconic automaker, just announced that they are going to cut 50,000 jobs. Does the EU really want to piss off their public by continuing the war?
All of this, Venezuela, Ukraine, Iran, Russia, China, is connected.
Jeff Childers comments on the supposed chaos going on.
What looks like reckless escalation is actually a four-dimensional squeeze, and every piece was in position before the first Tomahawk hit Tondgouyan:
- The IRGC is being financially strangled. Its domestic refinery is destroyed, its revenue sources are cut, and its soldiers were offered amnesty to surrender.
- Russia is being peeled away from Iran with an offer Moscow can’t refuse— hundreds of millions of barrels of unsanctioned oil revenue, plus a path to end its economic isolation.
- China is watching all three of its discount oil suppliers —Venezuela, Iran, and soon maybe Russia— disappear or reprice simultaneously, as tariffs bite from the other direction. Without oil, it can’t even think about invading Taiwan.
- And Kharg Island —Iran’s crown jewel— sits there undestroyed, waiting to be captured. A seized terminal is worth infinitely more than a bombed one.
This is not to say that the whole plan could not go sideways. There are probably an awful lot of ways this could go wrong. However, I believe Trump is betting his presidency on this. And Trump did write a book called The Art Of The Deal.