Why is Russia is on about nukes, again?
God only knows what to make of the announcement this week that Russia would conduct exercises with tactical nuclear weapons. It’s not like they haven’t crossed red lines before in Ukraine – the invasion, both of them, were red lines. So were using banned chemical weapons, since the beginning of the war some 500+ Ukrainian have been treated for exposure to chloropicrin and tear gas.
While perfectly legal to use tear gas on rioters and protestors (these –days you can tell the difference?), use on the battlefield is a war crime. The practical difference is that rioters have places that they can go – and I’d suggest the high-ground. That’s the point: to get people to disperse. Tear gas, being heavier than air, settles in low places. If you are in a trench or a dug-out with no escape other than to make yourself target practice, it will suffocate you.
War has always been the politics of last resort, now its political theater. The warning on tactical nuclear weapons is probably a managed escalation of desperate bluff with Moscow preparing for a summer offensive. Has it come in response to French president Emmanuel Macron’s suggestion that NATO troops head into Ukraine to protect infrastructure and civilians? Or that NATO troops from 14 nations are coordinating drills in Latvia. Or perhaps it was because Lord David Cameron, the U.K. Foreign Minister, said he wasn’t too picky about where Kyiv aimed those British weapons. Or perhaps Vladimir Putin read the 2023 annual report of Kremlin’s favorite energy giant?
It is in Putin’s wheelhouse to make these threats, but the nuclear deterrent will really only work as a threat. Actually use the damned things and any leverage you had gets replaced by a fiery death from above. However, Gazprom’s $6.9bn loss last year – it’s first in 20 years – just may be an excellent lesson in applied leverage.
In 2022, Moscow famously turned off the gas taps to Europe to freeze them into submission at a time when the bloc imported about 40% of its natural gas from Russia. Yet, thanks to global warming, Europe had a pleasant winter and Moscow scrambled to reroute about 80% of its Liquified Natural Gas (LNG). Russia doesn’t have much capability to ship LNG anywhere only to pipe it. That limits choices.
The Power of Siberia pipeline can deliver about 38bcm to China, with an extension extending that another 106bcm, which gets the volume in the same ball park as what it was selling to Europe. Another Power of Siberia 2 is being planned, but isn’t expected to be online before 2029.
The rub is that China doesn’t really want the stuff. Beijing is obsessed with energy security, and doesn’t want to put all its eggs in one basket. Certainly not a Russian one – just look what they did to Europe. Negotiations between Moscow and Beijing have stalled, and so has work on the second pipeline. China will likely keep negotiations on Russia LNG in limbo until after 2025-26 when large US and Qatari LNG project come online, driving the price down even further.
The lesson for Moscow is that old maxim: “A friend in need is going to get his pants pulled down on the price.”
As for the EU, it has proposed the first sanctions on Russian natural gas. The lesson here is that the threat to cut something off only works if you retain the ability to turn it back on. Without it, that pretty much leaves them negotiating with India. And if you’ve ever had the pleasure of negotiation with Indians, they treat it like a sport. And like cricket, they are very good at it.
The wider energy markets aren’t painting a pretty picture for Russia’s narrow, energy driven economy: Spikes and disruptions aside, the world’s supply of oil currently outstrips demand. Enormous Caribbean discoveries that have the Venezuelans so worked up haven’t really been felt yet. The only thing keeping oil markets tight is OPEC+ production cuts. Going forward, the International Energy Agency (IEA) predicts that demand for oil will peak this decade. Although don’t be so sure about that.
The BRICS club was supposed to be a counter-weight to the West, but both India and China look content to pick Russia clean as it prepares for a summer offensive. That’s Russia’s long to medium term problem.
In the short term, the global issues are more apparent: Gas warfare, the GPS jamming of civilian air traffic, the attack on the sea-lanes, and now, tactical nukes. North Korean is openly pursuing its biological warfare program while the intelligence and common sense tells us that Russia, China nor Iran ever actually halted theirs.
It is all a terrifying vision of the future of conflict that seems to have arrived.