It’s an open question as to who has the better of whom between the West and Russia. In the West most of the sanctions have been “show” sanctions made out of swiss cheese, big enough for the West to save face, but designed not to really bring any discomfort on the West. In Russia meanwhile, every Western sanction has been met with a counter-sanction which, when triggered, would be far more devastating to the West than the Western sanctions claim to be against Russia.
The examples are disheartening.
The EU sanctions exempted oil, gas, coal, diamonds and other natural resources. The bank sanctions exempted Sberbank, the largest bank in Russia having 1/3 of all Russia’s banking. Why? It was the bank that handles the oil and gas transactions!
The U.S. did the same to start. Then, exposed & embarrassed imposed it on oil.
The U.S. and EU froze Russian state funds asserting it would cripple Russia. But the U.S., without publicizing the exclusion, allowed Russia to use the “frozen” funds to pay their U.S. debts. Some “freeze”. Only when exposed & embarrassed stopped it.
The U.S. protective umbrella for friends in the Far East is reciprocated by Japan & South Korea increasing oil purchases from Russia and Japan continuing with oil & gas development projects in Russia. The largest of the large, Samsung, refuses to stop selling to Russia.
And India makes out like a bandit buying Russian oil at a 35% discount from the price as it was before the war increases!
So EU and U.S. companies stop business in Russia. Russia decrees to expropriate all their business and assets in Russia. Ployed by our own gambit.
So, U.S. demands payment on Russian sovereign debt ($40 bln) in non-frozen dollars. Then Russia requires payment in Rubles; and E.U. acquieses, allowing payment to the Russian bank in Euros and let the bank convert to rubles!
Rating agencies declare default on Russian bonds. U.S. makes no mention of Russian private debt ( >$120 bln). Russia decrees void the bonds if defaulted. So if the West tries to follow through, Western banks take a $120 bln hit!
After 2 months of war & delay, EU still talking about cut off of oil. Germany still finding excuses not to send heavy weapons to Ukraine. Simple reason: Russia pre-emptively reversed German gas flow from Germany back to Russia at the beginning for a few days. Germany and EU got the lesson: no heavy weapons; no stop payment for oil & gas.
common sense Blog 