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Russia Missed Opportunity to Remove Sanctions & Restore US to Arms Control Agreements
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The Kremlin held a winning hand in oil negotiations and did not play it. Washington and Saudi Arabia desperately needed Russian agreement to their plan to raise the price of oil by cutting production and reducing the supply of oil. Russia can tolerate $20 or $25 barrel of oil, but the highly leveraged and bankrupt US fracking industry cannot, and neither can Saudi Arabia’s bloated state budget. All the Kremlin had to say was:

“We will save your bacon by giving you a higher oil price, but we want something out of the deal for ourselves. Here is what we want. All sanctions removed, not only from us but from Cuba, Venezuela, China, and everywhere else. These sanctions are illegal under international law and constitute acts of war. We have run out of patience with them.

“For Russia to give you a higher oil price, we also require that Washington reenter all the arms control agreements from which you gratuitously and unilaterally withdrew, that you remove all missiles from our borders, and that you cease your provocative war maneuvers on our borders.”

Faced with a highly leveraged bankrupt fracking industry, Washington would have agreed.

It is a pity that the Kremlin gave up this chance to restore the world to a peaceful path instead of choosing yet again to earn brownie points with Washington. Washington has never appreciated and never will appreciate the Kremlin’s good will intentions.

The “oil chaos” that the Kremlin brags about preventing was Russia’s best ally. The Kremlin threw in its winning hand and let Washington and the Saudis walk off with the winnings.

https://www.rt.com/news/485501-opec-russia-deal-prevents-chaos/

(Republished from PaulCraigRoberts.org by permission of author or representative)
 
• Category: Foreign Policy • Tags: Oil Industry, Russia 
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  1. As well documented by Mr. Roberts, this is not the first time that Putin has folded on a winning hand. IMO he is the greatest leader on the planet, but it is baffling to me why he does so. Does he have some unused tricks up his sleeve, or, as is clearly the case with Trump, do the Oligarchs above him, whoever they are, tell him what to do?

  2. derer says:

    Do not underestimate Putin, he is waiting for the right time to bargain a better deal…this wan’t the right time.

    • Replies: @Jean-Marie L.
  3. @derer

    I would agree with that. The oil price crisis is far from over, and the frackers are still going to the dogs.

    What happened was a token concession to invite the US to cut their production. If they do, this will be another nail in the frackers’ coffin. If they don’t, the US will have nothing to complain about.

    At any rate, it is now plain that the ball is in the US court. This is where negociations can start.

  4. Ferengi says:

    Why do a deal for anything with the US?

    The US isn’t ‘agreement-capable’ – in other words, they NEVER keep to the terms of the deal and in fact often violate it or worse the next day.

    Since this is the case, then it’s not even worth expending the energy re negotiating any agreement. The agreement will turn out worthless due to Western dishonesty.

    The oil deal has done mostly what it needed to do – US shale will die now, the coronavirus depression will finish it off, same as it will the US and its fake money.

    No need for Russia to take any further economic hits, better to keep economic ammunition in place to help the people than dissipate it chasing things that will happen anyway.

    • Replies: @Realist
  5. mutthead says:

    Russia has 2 alternative approaches available: the short game and the long game. PCR impatiently opts as usual for the first: confrontation and a game of chicken with the US–but he also admits that they are unstable Armageddon-seeking neocon-evangelical and Jewish apocalyptic fanatics who believe the Bible guarantees them a nuke win and and a New American Millenium. The second–the option the Chinese have clearly chosen–is to expose the US/NATO increasingly to the world for what they are: warmongering, greedy, inhuman devils; and win over more and more nations and peoples to the Russo-Chinese Eastern way, without risking Armageddon. This is how hegemony shift can occur without a Thucydides trap. And it is happening rapidly, economically and with soft power. Almost everyone now knows which bloc, Sino-Russia vs Atlanticist, runs affairs better and is de facto in charge. Give it time.

    • Replies: @animalogic
  6. Galeano says:

    Russia and China both had the chance to bury Trumps reelection once and for all. But they didn’t. Pompeo’s call to Beijing asking for mercy for not revealing everything China has about the health crisis and the Kremlin saving American Xisto (Trumps financial base) were both chances. Why did Beijing and Moscow save Trump?

  7. swamped says:

    “The Kremlin threw in its winning hand and let Washington and the Saudis walk off with the winnings”…but they won’t get very far; these agreements can dissolve quickly & Russia benefits from higher prices, too. Getting rid of sanctions (except on China) & winding down NATO would be great ideas, but momentary oil price bargaining alone couldn’t do that. If it could, then Saudi Arabia should have said : “We will save your bacon by giving you a higher oil price, but we want something out of the deal for ourselves. Here is what we want”…the blockade on Gaza fully lifted; removal of all Israeli settlements (& citizens) from the illegally Occupied Palestinian Territories; full right of return for Palestinian refugees; equal rights for Palestinian citizens of Israel; evacuation of Golan Heights; & official recognition of sovereign state of Palestine.
    “It is a pity that [Riyadh] gave up this chance to restore the world to a peaceful path.”

    • Replies: @Dan Hayes
  8. PCR is right again.He is hitting at least a .900 Average.If he were in the major league
    he’d have the all time record by far.Thanks again,your discourse and insights
    are very much appreciated.
    Peace,Life,Love

  9. @mutthead

    Yes, indeed.
    “Faced with a highly leveraged bankrupt fracking industry, Washington would have agreed.”
    Washington would have done either: said “no” or lied & said “yes”.
    The US doesnt remove sanctions, until the victim dies, or screams “uncle”….

    • Agree: nokangaroos
    • Replies: @Thomas Milton
  10. Maybe Mr. P. was concerned that The Empire might unleash the L-strain on Russia.

  11. Why didn’t Russia make deal? easy. The sanctions force countries to operate outside the dollar system. Low oil prices hurt the petrodollar. If Russia can weather the storm, why not let it hit land? The US fracking industry goes bankrupt. A win for Russia. Saudi Arabia goes into a crisis. The Saudis brought bloodshed and misery to the Caucasus and Central Asia by their sponsorship of mercenary “Jihadists”. Payback time. If Saudi ends up like Libya, oil prices are sure to “bounce back”. Russia told the world years ago that the US is not a reliable counterparty. No one can make a deal with them.

    Group Captain Mandrake tells us all we need to know about the “Plandemic”.

  12. @animalogic

    Letting the fracking industry go bankrupt will purge the debt and make it more competitive. Fake money in, fake money out, new fake money to buy it up for pennies. Debt and shares of the fracking firms long since distributed to customary bagholders like 401k’s, pension funds, grannies. So the people at the top don’t need to make concessions to Russia to prop up oil prices. They already have a “Saudi Spring” planned.

    • Replies: @nokangaroos
  13. haha says:

    It should be clear by now to everyone – but isn’t – that Russia is desperate to mend ties with Washington and will be happy to become a junior partner of US at any cost. Unfortunately, the US keeps throwing away opportunity after opportunity. Putin is no rabid nationalist. He recognizes the limitations of Russia and has been trying whichever way he can to be accepted into the mainstream of the ‘West’. He tried to cozy up to Merkel’s Germany for year after year and humiliation after humiliation. He has been trying the same with the US, year after year, President after President. If George Bush could say that after looking into Putin’s eyes he saw a potential friend, it must have been because of promises and concessions that Putin held out.

    Russia is a country with many problems and many limitations but is not inherently dangerous or a threat to anyone. If this was recognized by US leaders, the Russian bear would have been tamed a long time back. This bear only wants to be fed and petted.

  14. Dan Hayes says:
    @swamped

    Don’t you realize that Saudi Arabia is in bed with Israel and Israel is its current New Best Friend?

  15. @Thomas Milton

    I somewhat doubt the latter – unless they are willing to write off Kuwait, Bahrain, Qatar and most of the “Saudi” oilfields; there is a reason the Gulf is called “Persian” and not “Lake Monroe”.
    An American who remembers the ouster of Mossadegh is practically the definition of a historical visionary, but Iranians go back to the sacking of Reza Shah (his daddy) 1941 and further.
    Any stirring of the bathtub is going to strengthen Iran.

    – The upside of these camel thief “mon”archies is there are hundreds of corrupt princes to choose from, so I expect a palace coup.

    – Agreed on the rest … they sure do act as if they have finally groked their only way out of this is another world war.

  16. jsinton says:

    I think you underestimate Putin’s hand. Time is on his side right now. He’s got Washington where he has them. Washington seems to think it can print it’s way out of the economic disaster, when it actually robs Paul to pay Peter and heads toward untold upheaval. The longer he waits, the better his deal will be.

  17. Realist says:
    @Ferengi

    Why do a deal for anything with the US?

    The US isn’t ‘agreement-capable’ – in other words, they NEVER keep to the terms of the deal and in fact often violate it or worse the next day.

    The US is one of the most duplicitous countries on the planet.

  18. Ximenes says:

    Mr Roberts never tells us how he has more information and a better strategy than Putin.

    “Faced with a highly leveraged bankrupt fracking industry…”

    The fracking industry is no nearer to bankruptcy than highly leveraged banks. It is too big to fail, only a couple of keystrokes away from a Fed bailout.

    “The Kremlin threw in its winning hand…”

    Perhaps Putin is also under intense pressure from his own oil industry, which happens to be privately owned?

  19. Bill H says:

    Russia can live with low priced oil. The US fracking industry cannot. Why would Russia want to get themselves out of that catbird seat?

    Russia can live with US sanctions. They have geared their economy to do so, and in so doing have damaged the EU more than themselves. Why would Russia want to undo the self sufficiency that they have achieved?

    The US has made agreements with many parties and has broken them with great regularity. Russia has reached the point that they regard us as not being capable of engaging in agreements. Why would they make an agreement with us, knowing that we will break it?

  20. Russia is playing this like Bernie is playing the Democratic Party. Another depressing example that representative democracy implies representatives who will always try and preserve the system they swim in. I give Putin more odds of playing 444D chess, but getting seemingly nothing out of this – and only the removal of all sanctions would have been reasonable – I don’t see it.

    Buy a yellow vest, demand a participatory semi-direct democracy, where the citizenry can reverse representative decisions.. since they clearly can’t be trusted to make them by themselves!

  21. Svevlad says:

    Why would they?

    The sanctions and shit, they hurt the targets a little and cause discomfort, but in the long run are suicide. Why stop an enemy from shooting itself in the foot?

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