Russia Scrambles to Maintain Oil Sales, Lifeblood of Economy

It's stunning. These sanctions are unbelievable powerful, and all in real time, with shockingly swift effects.

And now Russia's energy sector is getting hammered.

At WSJ, "Refiners balk at buying Russia’s oil and banks refuse to finance shipments of Russian commodities, fearing the impact of financial sanctions":

In their broadside of sanctions on Russia, the U.S. and its allies are going out of their way to spare energy shipments and keep economies humming and voters warm.

The oil market went on strike anyway. Acting as if energy were in the crosshairs of Western sanctions officials, refiners balked at buying Russian oil and banks are refusing to finance shipments of Russian commodities, according to traders, oil executives and bankers.

The self-imposed embargo threatens to drive up energy prices globally by removing a gusher of oil from a market that was tight even before President Vladimir Putin attacked Ukraine. Russia, waging war and in need of revenue with its financial system in turmoil, is taking extreme steps to convince companies to buy its most precious commodity.

Before refiners and banks are certain they won’t fall afoul of complex restrictions in different jurisdictions, they won’t do business with Russian oil, traders and others involved in the market say. Market players also fear that measures that target oil exports directly could land as fighting in Ukraine intensifies.

“This is going to make it very complex to trade with Russia,” Sarah Hunt, a partner at law firm HFW who works with commodities traders, said of the sanctions laid out as of Monday. “These sanctions against Russia will have an incredible effect on global trade and on trade finance.”

Brent-crude futures, the benchmark in international energy markets, rose nearly 8% Tuesday to above $105 a barrel. In a sign that demand for Russian oil has evaporated, prices for the country’s flagship Urals crude moved in the opposite direction.

Traders are offering Urals at massive discounts of around $15 a barrel below the price of Brent—and even then not finding buyers. A drop in the price of Espo, a grade of Russian crude popular in Asia, suggests refiners in Japan and South Korea are hitting pause on purchases alongside those in Europe and the U.S.

“The market is starting to fail,” said a person at a major commodities trading house.

Companies including Vitol and Trafigura Group Pte. Ltd.—among the world’s biggest independent oil traders—hold Russian oil bought under long-term deals. They were unable to sell Tuesday, people familiar with their operations say.

In Europe, Swedish refiner Preem AB and Finland’s Neste Oyj say they have stopped Russian oil purchases and mostly replaced them with Northern European oil purchases. Valero Energy Corp., a Texas-based refining company, has suspended all future purchases of Russian oil, people familiar with the decision said.

For now, Russia is exporting about as much oil as it was on the eve of Thursday’s invasion. But those flows, based on sales made before the war, will slow drastically in the coming weeks once cargoes have been delivered, traders and analysts say.

Russia was seen as having the upper hand when it came to energy in its confrontation with the West. In peacetime, Russian crude and other varieties of oil get funneled into refineries in Europe, the U.S. and Asia. There, it gets converted into fuels that power fleets of cars and other forms of economic activity.

Europe especially relies on Russia for much of its energy needs, both for natural gas to heat homes and fuel electricity plants, but also the oil that travels through pipelines directly into refineries in Germany, Poland, Slovakia and elsewhere. Some of that oil transits through Ukraine.

The importance of Russia’s energy industry—exporter of about 7.5% of the world’s oil—to the global economy led Western governments to carve oil and gas out of their sanctions. In cutting some but not all banks from the financial system’s messaging infrastructure, Swift, the U.S. and others left avenues for traders to pay for oil and gas.

As prices for Russian crude tanked last week, companies in India vacuumed up around seven million barrels of Urals oil, according to people familiar with the matter. Even there, however, companies are taking steps to limit sanctions risk.

On Monday, Indian Oil Corp. sent a letter to crude traders stating it would buy Russian oil only if delivery was included, according to a person familiar with the matter and a document seen by The Wall Street Journal. In the document, the Indian refining giant said it would no longer buy two grades of Russian oil, as well as a blend of Kazakh oil, if it had to take responsibility for transporting the oil. This was because some shipping companies are hesitant to load Russian crude, the person said. Indian Oil didn’t immediately respond to a request for comment...

 

Israel's Balancing Act on Ukraine

 At the New York Times, "War in Ukraine Forces Israel Into a Delicate Balancing Act":

Israel is a strong ally of the United States, and its leaders have a good relationship with Volodymyr Zelensky, Ukraine’s Jewish president. But Israel also doesn’t want to provoke Russia.

TEL AVIV — On the day Russia invaded Ukraine, Israel’s prime minister, Naftali Bennett, did not mention Russia once. Mr. Bennett said he prayed for peace, called for dialogue and promised support for Ukrainian citizens. But he did not hint at Moscow’s involvement, much less condemn it — and it was left, as preplanned, to Mr. Bennett’s foreign minister, Yair Lapid, to criticize Moscow in a separate statement that day.

The pair’s cautious double act embodied the bind in which the war in Ukraine has placed Israel.

Israel is a key partner of the United States, and many Israelis appreciate longstanding cultural connections with Ukraine, which, for several months in 2019, was the only country other than their own with both a Jewish president — Volodymyr Zelensky — and a Jewish prime minister. But Russia is a critical actor in the Middle East, particularly in Syria, Israel’s northeastern neighbor and enemy, and the Israeli government believes it cannot risk losing Moscow’s favor.

For much of the past decade, the Israeli Air Force has struck Iranian, Syrian and Lebanese military targets in Syria without interference, trying to stem the flow of arms that Iran sends to its proxies in both Syria and Lebanon and to limit a military buildup on its northern border.

Israel also wants to leave itself enough room to act as a go-between in the conflict. After Ukrainian requests, Mr. Bennett has offered at least twice to mediate between Russia and Ukraine, most recently on Sunday — when Mr. Bennett rushed abruptly from a cabinet meeting to speak with President Vladimir V. Putin of Russia for 40 minutes. And Israeli officials, including Mr. Bennett, shuttled between their Russian, Ukrainian and American counterparts on Sunday afternoon, two senior Israeli officials said, a mediation that may have contributed to Ukraine’s decision to meet with Russian officials on the Belarusian-Ukrainian border.

Israel, which often asks that its allies support it unconditionally, finds itself in the uncomfortable position of appearing to refuse to publicly criticize Russia, even when other countries with seemingly more at stake have condemned Mr. Putin’s war.

It is a “delicate situation for Israel,” said Ehud Olmert, a former Israeli prime minister who dealt often with Mr. Putin during his time in office.

“On the one hand, Israel is an ally of the United States and a part of the West, and there can be no doubt about it,” Mr. Olmert said in a phone interview. “On the other hand, the Russians are present in Syria, we have delicate military and security problems in Syria — and that requires a certain freedom for the Israeli military to act in Syria.”

Israel also wants to avoid taking any action that might stir antisemitism against the hundreds of thousands of Jews in both Ukraine and Russia...

More. 

Joe Biden Heading into the State of the Union Address: Fifty-Six Percent of Americans Say President's First Year a Failure

I'm not watching. Nothing he says will help politically. He's torn the country apart. 

Polling surveys are simply shapshots in time. Things change, but if the election were held today it'd be a tsunami. The number of House Democrats retiring (or just bailing out) is near a 30-year high. 

November's going to be a bloodbath, from school board, state legislatures, governors, to Members of Congress --- it won't be pretty. 

Here's the brutal poll out form Marist last week, "NPR/PBS NewsHour/Marist National Poll: The Biden Administration Heading into the State of the Union Address":

President Joe Biden will deliver his first State of the Union address on Tuesday to a nation whose focus has shifted away from the COVID-19 pandemic and who is sending a message that they want Biden to focus on other issues, especially inflation. Americans’ concerns about their own personal finances and the overall direction of the country provide a stark backdrop for Biden who will face the nation with dismal reviews of his first year in office and his lowest job approval rating...

Majorities of Americans think Biden’s first year in office has been a failure (56%), he is not fulfilling campaign promises (54%), and he is doing more to divide the nation (52%) than to unite it. Americans are more than four times as likely to consider Biden’s first year to be a major failure (36%) than a major success (8%)...

Americans are generally not optimistic about the future of their personal finances, although 36% expect their financial situation to get better in the coming year, up from 30% in July 2021...

51% of Americans think people in their community are economically worse off than they were a year ago. 30% say they are better off, and 7% don’t think there has been much change. 12% are unsure.

With inflation and personal family finances top of mind, perceptions of President Biden’s first year in office are bleak. Majorities of Americans consider his time in office to be a failure, think Biden has missed the mark in fulfilling campaign promises, and believe he is a divisive force in the nation.

On Biden's divisiveness, see Newsweek, "More Americans Say Biden Is Dividing the Country Rather Than Unifying It, Poll Finds."

Rajan Menon and Eugene B. Rumer, Conflict in Ukraine

At Amazon, Rajan Menon and Eugene B. Rumer, Conflict in Ukraine: The Unwinding of the Post-Cold War Order.

Retired General David Petraeus: 'I can't overestimate how difficult a position he and his forces are in..." (VIDEO)

Here's retired General David Patreaus, the architect of the surge in Iraq, speaking to CNN's Brianna Keilar. 

The war's going "abysmally" for Russia:

Putin Accidentally Revitalized the West's Liberal Order

It's Kori Schake, at the Atlantic, "The Russian president thought he sensed an opportunity to take advantage of a disunited West. He has been proved wrong":

Russia’s invasion of Ukraine has unleashed a chorus of despair—beyond the cost in Ukrainian lives, the international order that the U.S. and its allies built after World War II is, we are told, crumbling. The writer Paul Kingsnorth has declared that the liberal order is already dead. The Indian journalist Rahul Shivshankar has argued that “in the ruins across Ukraine you will find the remains of Western arrogance.” Even the brilliant historian Margaret MacMillan has written that “the world will never be the same. We have moved already into a new and unstable era.”

The reverse is true. Vladimir Putin has attempted to crush Ukraine’s independence and “Westernness” while also demonstrating NATO’s fecklessness and free countries’ unwillingness to shoulder economic burdens in defense of our values. He has achieved the opposite of each. Endeavoring to destroy the liberal international order, he has been the architect of its revitalization.

Germany has long soft-pedaled policies targeting Russia, but its chancellor, Olaf Scholz, made a moving and extraordinary change, committing an additional $100 billion to defense spending immediately, shipping weapons to Ukraine, and ending the Nord Stream 2 pipeline, which was constructed to bring gas to Germany from Russia. Hungary, thought to be the weakest link in the Western chain, has supported without question moves by the European Union and NATO to punish Moscow. Turkey, arguably the most Russia-friendly NATO country, having bought missile defense systems from Moscow, has invoked its responsibilities in the 1936 Montreux Convention and closed the Bosporus strait to Russian warships. NATO deployed its rapid-reaction force for the first time, and allies are rushing to send troops to reinforce frontline states. A cascade of places have closed their airspace to Russian craft. The United States has orchestrated action and gracefully let others have the stage, strengthening allies and institutions both.

We are a long way from the ultimate outcome of Russia’s invasion, but even if Ukrainian military forces cannot prevail or President Volodymyr Zelensky and his government are killed or captured, it’s difficult to see how Putin’s broader gamble succeeds. If Zelensky falls, another leader will step forward. Even Russian-speaking Ukrainians have become anti-Russian. The scene depicted in Picasso’s Guernica, one of wanton and barbaric violence, is the best Putin can hope for: Conquering Ukraine will require unspeakable brutality, and even if Moscow succeeds on this count, foreign legions are flowing to Ukraine to assist an insurgency in bleeding Russia’s occupation. If Ukraine fends off Russia’s assault, it will be welcomed into NATO and the EU.

The Ukrainian government that so recently seemed mired in corruption and division has been outstanding: President Zelensky has refused to flee and inspired resistance; outgunned and outmanned Ukrainian military forces seem to have held their own. They understand that they’re in a battle of ideas, establishing, for example, a hotline for Russian prisoners of war to call their families.

Civil activism is the lifeblood of free societies, and Ukrainians have been excelling, including the sunflower lady, who cursed Russian soldiers; civilians lining up to collect arms and make Molotov cocktails, or change out street signs to confuse the invaders; and breweries retooling to produce weaponry.

Ukraine’s tenacity and creativity have ignited civil-society energy, corporate strength, and humanitarian assistance. The hacker group Anonymous has declared war on Russia, disrupting state TV and making public the defense ministry’s personnel rosters. Elon Musk’s SpaceX has promised to help keep Ukraine online. The chipmakers Intel and AMD have stopped sending supplies to Russia; BP is divesting from its stake in the Russian energy giant Rosneft; FedEx and UPS have suspended service to Russia. Norway’s sovereign wealth fund is cutting all its investments in Russia. YouTube and Meta have demonetized Russian state media. (Even Pornhub is denying Russians access.) Belarusian hackers disrupted their country’s rail network to prevent their government from sending troops to support the Russian war. Polish citizens collected 100 tons of food for Ukraine in two days. Bars are pouring out Russian vodka. Iconic architecture in cities all over the free world is lit up with the colors of the Ukrainian flag to show solidarity. Sports teams are refusing to play Russia in international tournaments. The London Philharmonic opened its Saturday concert by playing the Ukrainian national anthem, and the Simpsons modeled Ukrainian flags. This is what free societies converging on an idea looks like. And the idea is this: Resist Putin’s evil...

Still more.

 

Russian OnlyFans Girls Cut Off From International Payments System

At Rolling Stone, "OnlyFans Says It Has Restored Russian Creators’ Accounts."

The West's Sanctions Barrage Severs Russia’s Economy from Much of the World

I'm fairly blown away by how monstrous these economic sanctions are. Putin had squirreled away $650 billion in gold reserves, of which he can't even get his hands now. 

It's also fascinating that Russia's oil industry was largely spared from the sanctions barrage, explicitly because Western Europe is so dependent on Russian supplies. This is the killer weakness among the Western democracies, extreme vulnerability interdependence: The abject reliance on the world's worst authoritarian regimes (including Saudi Arabia, etc.) for their energy supplies.

This is conflict oil and should be completely repudiated by Western societies. In the U.S., that would mean the stupid Biden administration would have roll back its green energy agenda, deregulate, restore pipeline projects, allow drilling and production on federal lands, etc., and then just leave freakin' energy markets alone to boost supplies of oil, natural gas, and whatever else we need.

Sheesh. 

At the Wall Street Journal, "The country has been all-but-unplugged from a global system that powered its yearslong transition from a closed society":

Western nations dropped economic sanctions of historic scale on Russia that are hobbling its financial system and effectively reversing 30 years of post-Cold War engagement.

The economic moves by the U.S. and Europe, in response to the invasion of Ukraine, reverberated Monday through Russia’s economy, which was largely cut off from much of the West, and hindered the ability of Russia’s central bank to manage the country’s financial system and mitigate the damage.

Western banks and businesses added to the governments’ actions by halting operations in Russia and sales to Russian companies. Many cited the risks of potentially violating sanctions. More broadly, businesses prize stability, and invasions create chaos.

In just days, Russia has been all-but-unplugged from a global system that powered its transition from a closed, government-controlled economy to a more modern one that yielded Western goods, foreign travel and a middle-class lifestyle.

“Today, Russia’s financial system and economy are facing a totally abnormal situation,” the usually reserved Bank of Russia Gov. Elvira Nabiullina, dressed in black, said Monday.

The impact hit Russian stock, bond and currency markets. Its central bank shut the stock market, avoiding an expected selloff, and raised benchmark interest rates to 20% from 9.5%, to make holding the ruble more attractive and cushion its expected fall.

The ruble fell to 108.014 to the U.S. dollar from 83 on Friday—a drop of more than 20% and its worst one-day decline since Sept. 3, 1998. Shares of several large Russian companies traded in London and they fell as well. Sberbank, the country’s largest lender, was down 74%. The bank was sanctioned by Western nations. The country’s energy giants also got hit, with Gazprom falling almost 53% and Rosneft declining 42%. The central bank said the Russian stock market would remain closed Tuesday.

Russia imposed capital controls, blocking residents from sending money to foreign bank accounts and restricting payments on offshore debt. On the streets, Russians on Monday lined up at ATMs to take out cash.

The speed and breadth of the sanctions overwhelmed years of preparation by Russia after the 2014 sanctions. In a strategy dubbed Fortress Russia, the country built up more than $600 billion in foreign reserves, bought gold and pivoted some exports to China. Closing off Russia’s access to those reserves undercut the strategy, a fact acknowledged by Ms. Nabiullina, the central bank chief.

Timothy Ash, an emerging-market strategist at BlueBay Asset Management, wrote in a note to clients Monday: “From Fortress Russia to Rubble Russia in a week.”

The latest round of sanctions are likely to cause a sizable contraction for Russia’s economy this year, and could prompt bank runs and higher interest rates as the Russian ruble depreciates, according to the Institute for International Finance, a Washington-based global association of financial firms, Elina Ribakova, deputy chief economist at the IIF, said Monday she expected sanctions to bring about a contraction of at least 10% in Russia’s gross domestic product along with double-digit inflation.

“The pressure on the Russian economy is just tremendous,” said Janis Kluge, an expert on the Russian economy at the German Institute for International and Security Affairs. “And it’s going to get even more dramatic over the next weeks and months.”

Even before Russian President Vladimir Putin’s decision to invade Ukraine, Russia’s central bank had difficulty bringing inflation under control. In January, the inflation rate stood at 8.7%, more than double the central bank’s target, despite a series of interest rate increases that began last March.

Boris Titov, Mr. Putin’s business ombudsman, criticized the central bank’s rate increase Monday, saying in an Instagram post that it chose to “further strangle” Russian businesses that are already “at the front-line” of sanctions...

 Keep reading.

Ukraine: Fighting Continues as Peace Talks End (VIDEO)

I'm not exactly sure what was to be expected of the negotiations, especially since Putin was simultaneously bombing the hell out of civilians spaces in Kharkiv.

I'll try to figure it out. 

Meanwhile, at the Los Angeles Times, "Fighting rages on in Ukraine as talks with Russia end without breakthrough":

KYIV, Ukraine — Russia and Ukraine came together Monday for a first round of talks that failed to ease Europe’s biggest ground war in 75 years as Russian missiles pounded Ukraine’s second largest city, troops pressed closer to the capital of Kyiv and more than half a million Ukrainians fled the country.

International efforts to punish and isolate Russian President Vladimir Putin intensified and took aim at his country’s most important finances, while even traditionally neutral Switzerland joined the growing coalition of nations imposing a raft of sanctions on Putin and associates, demanding Russia withdraw its troops immediately.

But Putin seemed to remain impervious to the pressure and insisted Russia was not targeting civilians in its attacks despite abundant evidence to the contrary. Rather than back down, Putin may be driven to increasingly brutal tactics, several experts warned.

With great skepticism, President Volodymyr Zelensky agreed to the Monday negotiations, despite seeing “small chance to end the war,” and said the fate of his country as an independent nation had now entered a “crucial period.”

Delegations from Ukraine and Russia met for about five hours at a site near Ukraine’s border with Russian ally Belarus, and they agreed to hold another round of talks. But diplomats portrayed a wide chasm nowhere near resolution: Ukraine is demanding a cease-fire and withdrawal of Russian troops, while Russia wants a “demilitarization” of Ukraine and pledge of neutrality, meaning it must step away from the West.

In Kyiv, a two-day-long curfew was lifted Monday to allow residents to venture out cautiously to replenish supplies, get some fresh air and survey the state of their city of 3 million people. Many lined up for hours outside gas stations and supermarkets, mostly ignoring the occasional wail of air-raid sirens.

Fighting continued on the outskirts of the capital, with satellite images showing Russian troops mostly massed about 15 to 19 miles north of the city, according to U.S. and British defense officials. No major population centers have yet fallen to Russian forces, which has raised fears that Putin will soon order an all-out blitz to overrun Ukraine, depose its government and turn it into a vassal state.

“They have been slowed and they have been frustrated by their lack of progress on Kyiv, and one of the things that could result is a reevaluation of their tactics, and the potential for them to be more aggressive and more overt in both the size and scale of their targeting of Kyiv,” a senior U.S. Pentagon official said.

Zelensky once again called on his compatriots to defend their land.

“When I planned to become a president, I said that each of us is the president, because we are all responsible for our state, for our beautiful Ukraine,” Zelensky said in a video address Monday, the latest in a series of public messages that has buoyed and drawn the admiration of many of his people. “Now it has happened that each of us is a warrior. ... And I am confident that each of us will win.”

But more than half a million Ukrainians have now fled their war-torn country, said Filippo Grandi, the head of the United Nations’ refugee agency. At last count, about 281,000 people had entered Poland from Ukraine, more than 84,500 had escaped to Hungary and nearly 100,000 had arrived in Romania, Moldova and Slovakia, the agency said. The remainder had found their way to other countries.

There were signs of stress in Russia as well, with the heavy sanctions imposed by the U.S., Europe and other nations, including Japan and Australia, beginning to take a toll...

Still more.

 

Ms. Lindsey's Resouceful

 On Twitter.

Federal Government Warns Americans to Mask, Social Distance While Sheltering From Nuclear Explosions

From Ed Driscoll, at Instapundit, "IT’S COME TO THIS."

And on Twitter.

In Dramatic Shift, Germany Begins Military Rearmament

You have to think about Germany for a second. 

It's been 77 years since the end of World War II. In the first half of the 20th century, the "German problem" was the security issue of the day. Germany unified so late compared to the other major European powers, and emerged so strong in its historically accelerated state modernization, by the beginning of the century it had already begun to shift the world balance of power and was now demanding its "place in the sun." 

At the end of World War II, American policy was unconditional surrender, for both Germany and Japan. The defeated Reich was divided into four zones of occupation. Nazism and militarism were to be obliterated forever. During the Cold War, the policy of the Western powers was to "to keep the Russians out, the Americans in, and the Germans down." This was the new world order.

The enormity of Germany's attempt at world domination, its abominable program of extermination of an entire race of people, the ignominy in its conviction for crimes against humanity, forced a complete reegineering of German society. In the decades after the war, the new Federal Republic of Germany (West Germany) emerged as a model of the progressive humanitarian state in world politics. It joined NATO, formed the European Economic Community (now the E.U.), and developed one of the largest and advanced economies in the world. 

"Never again" had been the call on the continent of Europe. Never again should Germany rise to hegemony and threaten the survival of an entire civilization.

And now here we are. Germany's going to actually rearm? Just the phrase "German rearmament" used to send shivers down the backs of leaders in the diplomatic halls of Europe. Now Germany's expected to increase defense spending by 2 percent. But how about in 2032? In 2042? How large will it be then? Shall a new German Reich be declared? 

Most of those who lived through the "nightmare years" of German rearmament and war are no longer with us. Few voices are left to urge vigilance against the return of darkness and evil. Yet, we're in such a significant period, the message can't be dismissed or forgotten. There's a real shift afoot. It may not seem as dramatic as the end of the Cold War --- which shifted world power from bipolarity to unipolarity --- but the return to multipolarity will have epoch consequences.

Stay with me, folks. It's something I'll be paying a lot of attention to. 

In any case, at the New York Times, "In Foreign Policy U-turn, Germany Ups Military Spending, Arms Ukraine":

Germany agrees to strengthen its military in the latest foreign policy about-face, amid pressure from allies and horror at Russia’s attack on Ukraine.

BERLIN — It took an invasion of a sovereign country nearby, threats of nuclear attack, images of civilians facing off against Russian tanks and a spate of shaming from allies for Germany to shake its decades-long faith in a military-averse foreign policy that was born of the crimes of the Third Reich.

But once Chancellor Olaf Scholz decided to act, the country’s about-face was swift.

“Feb. 24, 2022, marks a historic turning point in the history of our continent,” Mr. Scholz said in an address to a special session of Parliament on Sunday, citing the date when President Vladimir V. Putin ordered Russian forces to launch an unprovoked attack on Ukraine.

He announced that Germany would increase its military spending to more than 2 percent of the country’s economic output, beginning immediately with a one-off 100 billion euros, or $113 billion, to invest in the country’s woefully underequipped armed forces. He added that Germany would speed up construction of two terminals for receiving liquefied natural gas, or LNG, part of efforts to ease the country’s reliance on Russian energy.

“At the heart of the matter is the question of whether power can break the law,” Mr. Scholz said. “Whether we allow Putin to turn back the hands of time to the days of the great powers of the 19th century. Or whether we find it within ourselves to set limits on a warmonger like Putin.”

The events of the past week have shocked countries with typically pacifist miens, as well as those more closely aligned with Russia. Both have found the invasion impossible to watch quietly. Viktor Orban, the pro-Russia, anti-immigrant prime minister of Hungary, who denounced sanctions against Russia just weeks ago, reversed his position this weekend. And Japan, which was hesitant to impose sanctions on Russia in 2014, strongly condemned last week’s invasion.

In Germany, the chancellor’s speech capped a week that saw the country abandon more than 30 years of trying to balance its Western alliances with strong economic ties to Russia. Starting with the decision on Tuesday to scrap an $11 billion natural gas pipeline, the German government’s steps since, driven by the horror of Mr. Putin’s attack on the citizens of a democratic, sovereign European country, mark a fundamental shift in not only the country’s foreign and defense policies, but its relationship with Russia.

“He just repositioned Germany strategically,” Daniela Schwarzer, executive director for Europe and Eurasia at the Open Society Foundations, said about Mr. Scholz’s address.

Germany, and especially the center-left Social Democratic Party of Mr. Scholz, has long favored an inclusive approach toward Russia, arguing about the danger of shutting Moscow out of Europe. But the images of Ukrainians fleeing the invasion dragged up older Germans’ memories of fleeing from the advancing Red Army during World War II, and triggered outrage among a younger generation weaned on the promise of a peaceful, unified Europe.

On Sunday, several hundred thousand Germans marched through the heart of Berlin in a demonstration of support for Ukraine, waving signs that read “Stop Putin” and “No War.” Appealing to Germans’ commitment to European unity and the deep cultural and economic ties that reach back centuries, Mr. Scholz placed the blame for Russia’s aggression squarely on Mr. Putin, not the Russian people. But he left no doubt that Germany would no longer sit back and rely on other countries to provide its natural gas, or its military security.

“The narrative that Scholz employed today is there to last,” Ms. Schwarzer said. “He spoke about responsibility to Europe, what it takes to provide for democracy, freedom and security. He left no doubt that this has to happen.”

The country’s firm repudiation of its horrific Nazi past meant that it had long adopted a foreign policy of diplomacy and deterrence. But since the Russian invasion, many of Germany’s allies have accused it of not doing enough to fortify itself and Europe.

Germany pledged in 2014 that it would increase its military spending to 2 percent of its overall economic output — the goal set for NATO member states — within a decade, but projections had shown the government was not on track to meet that target, even as that deadline approached. The topic had long been a source of conflict between Berlin and Washington, which spends more than 3 percent of its G.D.P. on defense. The debate escalated under former President Donald J. Trump, who would regularly berate the German government for failing to carry its weight in the alliance.

In his speech, Mr. Scholz proposed that the military spending be anchored into the country’s constitution. That would ensure, he said, that the country would not again find itself with a military force of soldiers equipped with rifles that misfire, planes that can’t fly and ships that can’t sail. And he made clear that the doubling down on defense was for Germany’s own good...

 

Europe's Dependence on Russia's Natural Gas Supplies Following the Invasion of Ukraine

Oil.

Petroleum.

Fossils fuels.

No matter how much radical environmentalists deceive the leaders of the developed democracies, the fact remains that without fossil fuels, these countries would perish.

At the Economist, "If the supply of Russian gas to Europe were cut off, could LNG plug the gap?":

Russia’s invasion of Ukraine has led to renewed speculation about the future of European energy, and in particular about its supply of natural gas. The continent gets around a quarter of its energy from gas. In 2019 Russia provided over 40% of that gas. The West has not gone so far as to place limits on Russian gas exports, although Germany has suspended the licensing of Nord Stream 2 (ns2), a completed but not yet operational pipeline between Russia and Germany. But what if Vladimir Putin, Russia’s president, were to cut off gas to the West? One alternative source of energy is liquefied natural gas (lng), which is usually transported by sea. To what extent could lng replace piped Russian gas as a source of energy for Europe?

Europe already uses a lot of lng; it makes up around a quarter of the region’s natural-gas imports. One question is how much more of the stuff Europe can process. lng is first turned into a liquid in order to be transported; it must then be “re-gassed” at terminals, usually near the coast, before it can be used to heat and power homes. Heavy investments in regasification plants mean that Europe has plenty of idle capacity. The region’s import terminals ran at 45% of capacity last year, according to Energy Intelligence, an industry publisher, although not all of these terminals are in the right place. Germany has no terminals, while Spain has a quarter of the continent’s capacity, even though its gas infrastructure is largely isolated from the rest of Europe.

The more pressing problem is the available supply of lng. The biggest exporters of lng are America, Australia and Qatar. Although they all have plenty more gas, all are already exporting at or near full tilt. It takes a long time to expand liquefaction and export capacity, so Europe’s best short-term hope would be to get hold of existing lng cargoes originally destined for elsewhere. But Asia also has a strong appetite for lng. China’s imports grew by 82% between 2017 and 2020, for example; last year it overtook Japan as the world’s biggest importer. And around 70% of lng traded globally is on contracts that run for ten years or more. Europe tends to rely on spot markets and shorter contracts. In the past that has allowed Europe to take advantage of low prices when stocks were plentiful, and ensured that countries did not commit themselves to using fossil fuels decades into the future. But it also leaves Europe at the mercy of the market.

When Europe’s gas reserves dwindled over the autumn and winter, in part because Russian supplies dropped, lng imports shot up (see chart). So did prices. In the past, spot prices in Asia have typically been higher than in Europe. But in recent months the price in Europe has at times matched Asian levels. The invasion of Ukraine has only made things worse...

Still more.

 

Putin's Looking to Rebuild Russia's Empire

 It's Niall Ferguson, at the Spectator U.K., "Vlad the Invader."

The pun refers to Vlad the Impaler:

‘War’, in Prussian military theorist Carl von Clausewitz’s most famous dictum, ‘is nothing but a continuation of politics with the admixture of other means.’ A generation of Democrats — the American variety, but also European Christian and Social Democrats — have sought to ignore that truth. Appalled by the violence of war, they have vainly searched for alternatives to waging it. When Vladimir Putin ordered the annexation of Crimea in 2014, Barack Obama responded with economic sanctions. When Putin intervened in the Syrian civil war, they tried indignant speeches.

When it became clear that Putin intended a further and larger military incursion into Ukraine, Joe Biden and his national security team opted for sanctions once again. If Putin invaded Ukraine, they said, Russia would face ‘crippling’ or ‘devastating’ economic and financial penalties. When these threats did not deter Putin, they tried a new tactic, publishing intelligence on the likely timing and nature of the Russian assault. Cheerleaders for the administration thought this brilliant and original. It was, in reality, a species of magical thinking, as if stating publicly when Putin was going to invade would make him less likely to do so.

Those who dread war approach diplomacy the wrong way, as if it is an alternative to war. This gives rise to the delusion that, so long as talks are continuing, war is being averted. But unless you are prepared ultimately to resort to force yourself, negotiations are merely a postponement of the other side’s aggression. They will avert war only if you concede peacefully what the aggressor is prepared to take by force.

Putin decided on war against Ukraine some time ago, probably in July when he published a lengthy essay, ‘On the Historical Unity of the Russians and Ukrainians’, in which he argued tendentiously that Ukrainian independence was an unsustainable historical anomaly. This made it perfectly clear that he was contemplating a takeover of the country. Even before Putin’s essay appeared, Russia had deployed around 100,000 troops close to Ukraine’s northern, eastern and southern borders. The response of the United States and the European Union was to make clear that Ukraine was a very long way indeed from either Nato or EU membership, confirming to Putin that no one would fight on Ukraine’s side if he went ahead with his planned war of subjugation.

Over the past few months, Putin has used diplomacy in the classical fashion, seeking to gain his objectives at the lowest possible cost while at the same time carefully preparing for an invasion. Western leaders have achieved nothing more than to remain united in saying they will impose sanctions if he invades. But a Russian invasion of Ukraine beyond the Donbas will create an entirely new situation. Politicians on both sides of the Atlantic may express a common outrage, but it will not take long for their unity to be eroded by the altered reality and their fundamentally divergent interests. The US does not need Russia’s natural gas. At least in the short run, Europe does.

If war is the continuation of politics — ‘policy’ is, in fact, a better translation — then what exactly is Putin trying to achieve? This question has elicited many wrong answers over the years...

 Still more.

Can Ukraine's Resistance Defeat the Russian Army?

This was published before armed hostilities broke out Thursday.

At War on the Rocks, "Can Ukrainian Resistance Foil a Russian Victory?":

The plans of a country facing invasion by a larger foe rest on a fragile hope: Once a nation’s conventional defenses are defeated, a pre-planned, citizen resistance will arise and contest the occupying invaders. Partisan warfare will impose costs on the occupiers, prevent the enemy from consolidating gains, and create the time and space required to receive external support for liberation. If Russia launches a fresh invasion, Ukraine will surely seek to fall back on such a strategy. Kyiv’s resistance plans — which have been carefully and loudly choreographed — are a key part of its hopes to deter Russia. Still, questions remain about Ukraine’s calculation for committing to a partisan-style guerrilla war. If Russia invades, will Ukraine’s partisans fight, survive, and change strategic outcomes? Would the threat of a citizen resistance, across the depth and breadth of Ukraine, meet its promise?

As a former U.S. Army special operations officer, I have spent some time building resistances or fighting them. On behalf of the Joint Special Operations University, I have more recently worked with countries to help craft resistance strategies as part of their total defense plans. In my experience, state-sponsored resistance movements defy easy categorization. Few stock templates exist because resistance plans are crafted to the political will, geographic constraints, alliance structures, and social dynamics of a given nation-state. It is also difficult to predict the behaviors of citizen resistors under the stress of invasion and occupation. Although I cannot predict what will happen, I can offer a framework to better understand the role of Ukraine’s citizen-resistance plans in resisting a Russian invasion.

Look Fearsome

A citizen-resistance must show enough of its capability to be feared. This truth comes in handy in the mountains nearby my home. When I see a bear while hiking, I calmly raise my arms and side-embrace anyone with me to look like a hyper-sized, multi-limbed threat. The bear experiences just enough doubt to pause and move on, seeking easier prey. Resistance, employed as a deterrent, has a similar effect. When a state threatens to fight a superior force with a motley collection of citizen-patriots, it must show enough width and breadth to make the invader pause. Ukraine has a credible threat in this regard. With its seven-year history of citizen-militias, quasi-official proxies, and official resistance formations, there is no question that invading forces will be met by gutsy irregulars. Ukraine has a Territorial Defense Force structure of over 150 battalions, geographically assigned to cover all of Ukrainian territory. These units are not uniformly functional, nor are they fully manned and equipped. However, they do provide a localized agency by which to organize infrastructure security and resistance. Ukraine is vocally advertising its resistance movement as one of many signals intended to deter invasion.

As I have previously discussed in Small Wars Journal, Ukrainian resistance units formed organically and spontaneously in 2014, often funded by private-sector oligarchs, rather than the state. Since then, Ukraine has regulated or incorporated many of these irregulars into the fabric of its defense plans. A recent poll indicated that 24 percent of Ukrainians plan to engage in armed resistance if attacked. The Ukrainian armed forces are currently outnumbered and face potential invading forces from the north (Belarus), east (Russia) and south (Crimea, Black Sea, Transnistria). If such an envelopment occurs, resistance forces will be required to fight when and where Ukrainian regulars cannot. Ukraine’s visible partisan warfare plan, when coupled with other deterrence measures, is aimed at deterring a new Russian offensive.

Switzerland employed such a strategy in 1940. When Nazi Germany conquered and occupied much of Europe in the spring and summer of 1940, tiny, neutral Switzerland was fully surrounded by Axis powers. Switzerland mobilized 400,000 citizen-soldiers, and planned to fight in the cities and destroy civil infrastructure before withdrawing to the Alps — favorable terrain for a guerrilla resistance. German staff estimates concluded that Switzerland could only be conquered with a massive commitment of Wehrmacht combat power. As such, Hitler decided against an attack. Other factors contributed, of course: Swiss industrial output, favorable neutrality and banking policies, and demands on German forces elsewhere. Still, Swiss preparedness to resist was a major factor. Spared in the summer of 1940, the Swiss successfully deterred in the moment and, as it turned out, for the rest of the war. Like the Swiss, the goal of Ukraine’s resistance build is to prevent an invasion instead of fighting one.

A Legal Framework

Ukraine passed an innovative law, “On the Foundations of National Resistance,” in July 2021. The law creates a legal framework by which to incorporate, organize, and guide a citizen resistance, as well as a specification of the role of irregulars, militias, and other citizen resistance actions. Since the Ukrainian government understands that not all resistance is productive resistance, the law sets legal boundaries by which the state can monitor, contain, or block counter-productive resistance.

The specter of all citizens taking up arms in a chaotic moment is as nightmarish to Ukraine as it is to Russia. Such chaos could advantage Russia, as it did in February 2014, when Russia snatched Crimea in a lightning strike of creative statecraft. The precipitating event for Russia’s Crimea takeover was a Ukrainian political crisis that led to widespread anti-government protests and civil unrest. In today’s unfolding crisis, Ukraine fears the unlawful spaces where Russian hybrid tactics thrive. Ukraine seeks to avoid wholesale societal breakdown, even if such chaos directly threatens invading Russians. The Ukrainian government has passed legal frameworks to prevent the emergence of chaos that advantages Russia. 

Radical Inclusion 

The power of resistance movements is their ability to bring opposition to scale, presenting multiple dilemmas to skilled, but task-saturated occupying forces. Resistance movements are, by definition, under-gunned and will lose in a conventional fight. Ukrainian planners are aware that Russian regular forces can and will take terrain, if ordered to do so. Furthermore, Russian tactical battle groups will not cede terrain to Ukrainian regulars, much less to the citizen-farmer defending his land with a hunting rifle. The widespread use of civil resistance, amplified by social media, presents a challenge to invading forces who will be intensely focused on winning kinetic battles...

Keep reading. 

Putin Raises Tensions by Putting Nuclear Forces on High Alert (VIDEO)

Starting up today's Ukraine coverage.

Check back throughout the day.

At the New York Times, "Live Updates: Ukraine Agrees to Talks with Russia, as Putin Places Nuclear Forces on Alert":

KYIV, Ukraine — President Volodymyr Zelensky of Ukraine agreed on Sunday to have Ukrainian officials take part in talks with Russia “without preconditions,” even as President Vladimir V. Putin further escalated tensions by placing his nuclear forces on alert.

“We agreed that the Ukrainian delegation would meet with the Russian delegation without preconditions on the Ukrainian-Belarusian border, near the Pripyat River,” Mr. Zelensky announced on his official Telegram channel, describing a phone call Sunday with President Aleksandr G. Lukashenko of Belarus.

Mr. Lukashenko “has taken responsibility for ensuring that all planes, helicopters and missiles stationed on Belarusian territory remain on the ground during the Ukrainian delegation’s travel, talks and return,” Mr. Zelensky continued. The Belarusian leader is a close ally of Mr. Putin’s.

It was not clear when the talks would begin, and late Sunday a Russian state news agency reported that they would only start Monday morning.

But just before Mr. Zelensky’s announcement, Mr. Putin issued a new threat to the West, which has increasingly rallied behind Ukraine as its citizens and its military fight back against the Russian invasion. In brief remarks aired on state television, he told his defense minister and his top military commander to place Russia’s nuclear forces on alert.

The Ukraine Interior Ministry said on Sunday that 352 civilians have been killed since the invasion began, including 14 children.

And even as the talks neared, satellite imagery showed a miles-long convoy of hundreds of Russian military vehicles bearing down on Kyiv.

Mr. Putin characterized his nuclear alert move as a response to the West’s “aggressive” actions...

 

Lee Smith, The Permanent Coup

At Amazon, Lee Smith, The Permanent Coup: How Enemies Foreign and Domestic Targeted the American President.

Ukraine Civilians Take Up Arms Against Russian Invaders (VIDEO)

Vitali Klitschko, the Mayor of Kyiv and the World Boxing Council's heavyweight champion, with his brother Wladimir (also a world championship boxer), at the video:

From NBC News: 

Few Ukrainians Thought Vladimir Putin Would Would Launch Full-Scale Invasion

At the editors' note appended to the top of this article: "On February 24, six hours after this article was filed, Russia began an all-out attack on Ukraine."

It's Tim Judah, at the New York Review of Books, "Ukraine on the Brink":

It is quite normal to refuse to believe that you are about to be engulfed by a cataclysm.

People in Kharkiv may not believe much in a Russian attack, but by the time you read this it may have begun. When I started writing it in the Half an Hour café in Kharkiv, there was news that the puppet regime in separatist-controlled Donetsk was evacuating the population, which sounded like a prelude to war. By the time I finished it, Russian troops were reported to be arriving there. Meanwhile they were playing Michael Jackson’s “Heal the World” in the café, which was full of earnest young people poring over their laptops or relaxing.

In my experience it is quite normal to refuse to believe that you are about to be engulfed by a cataclysm that will change your life forever—or kill you.

In 2014 I was invited to a Passover Seder by the Donetsk Jewish community. During the dinner the rabbi said unexpectedly, “We have a foreign guest, he can make a speech!” I said that “Next Year in Jerusalem” was all well and good but there were separatists constructing checkpoints on the highway into the city, so “Next year in Donetsk” might be more apt. “Nah,” they said, “it will all be fine!” A few weeks later they probably all fled. It was the same in Bosnia and Herzegovina just before the war in 1992. People said that since everyone knew that tens of thousands would die, there would be no war.

I met a teacher who told me that she veers between panic and shrugging it all off. In January Ukrainian president Volodymyr Zelensky said that the Russians might try to occupy Kharkiv, which alarmed people here. President Joe Biden was said to have told Zelensky a few days later to “prepare for impact,” though that was later denied. But then you think about it rationally, which of course Putin may not be doing, and you wonder how he could hope to seize a city of some 1.5 million people, let alone much of the rest of Ukraine.

In Kharkiv’s history museum there is a section devoted to World War II. Battles here were as bloody and devastating as anywhere in Europe. Millions of Ukrainian soldiers and civilians were killed or starved to death. Then something caught my eye: a panel explained that by the time the Red Army expelled the Germans from Soviet Ukraine in 1944, it numbered 2.3 million men. Putin has amassed anywhere between 150,000 and 190,000 on Ukraine’s borders, we are told, not all of whom of course will actually fight. Some are quartermasters, mechanics, and cooks. One of the videos circulating on social media, also allegedly from Belgorod, showed army mobile kitchens—identifiable by the chimneys poking out from under their tarpaulins—flowing past in a convoy.

In Lviv, in western Ukraine, I saw Ukrainian soldiers practicing with new antitank missiles that the British had given them. Some commentators scoffed that, in the face of overwhelming Russian military might, these were symbolic. Oh no, said the Ukrainian soldiers, these were great for the 200-400-meter range, which they did not possess, and were especially suited for urban warfare. When he talks about Ukraine, it is clear that Putin believes many Russian myths and has outdated views about its people. He published a long essay last year on the “historical unity” of Ukrainians and Russians. But what he and even many liberal, intellectual Russians may not appreciate is that Ukraine is not the same place it was when Mikhail Bulgakov grew up in Kyiv at the beginning of the last century. It is not the same place it was at independence in 1991 or at the time of the Orange Revolution in 2004, nor is it the same country that was wracked by revolution and war in 2014.

In Lviv, Odesa, Kharkiv, and finally Kyiv, something struck me for the first time after many years of coming here: their post-Soviet feel has finally been cast off. That is not the case in smaller Ukrainian towns, but for the first time these big cities feel like anywhere else in Europe.

Unlike Russians, Ukrainians have not needed visas to visit Europe’s twenty-six-country Schengen area since 2017, and thanks to cheap flights millions have done so. Most young Ukrainians, who have no memory of the Soviet era (for which you need to be close to forty), are now just like other Europeans. They are no longer people from Russia’s periphery who mentally, culturally, and socially orbit Moscow. I can imagine that older Russians like Putin, if he knows this, must hate it. It relates directly to the wise maxim of Zbigniew Brzezinski, the former US national security adviser: “It cannot be stressed enough that without Ukraine, Russia ceases to be an empire, but with Ukraine suborned and then subordinated, Russia automatically becomes an empire.” As the links that have bound Russia and Ukraine for centuries slowly snap with every passing year, no wonder Putin is worried and thinks this is his last chance to suborn and subordinate.

And Putin’s war since 2014 has made a big difference here. There are no longer direct flights or trains between the two countries. At Hoptivka, Lieutenant Colonel Yuri Trubachev of Ukraine’s Border Guard Service told me that before 2014 some 25,000 people crossed there every day. Now that figure is 2,500, and even if you discount the effect of Covid it is symbolic of the frayed ties. While I was there a two-mile line of trucks was waiting to enter Russia. A driver told me they had been there for perhaps three days, and it was the same to enter Ukraine. There is no logical reason for this, but as Taras Danko, a professor of international business in Kharkiv, noted tartly, “You need the cooperation of the border authorities and for that you need the cooperation between states, not talk of one state invading another.”... 

Keep reading.

 

New U.S. Containment Policy Against the Soviet Union Russia

I don't think most people realize, especially the weird right-wingers siding with Russia over Ukraine (something I haven't completely figured out, except for maybe Tucker Carlson?), that it's a new era. Big time.

NATO's never before authorized armed mobilization under the NATO Charter's Article V, which calls for "collective defense" in the event of a military attack against any NATO member. If there's an attack, each other NATO member is committed to providing mutual aid to any other member state of the alliance. There are 30 members, but without the U.S. it's pretty weak. 

The fighting in Ukraine, its initiation and its conclusion, will either dramatically shift the world balance of power or dramatically alter the perceptions of the world balance of power, regardless of the material qualitative/quantitative indices of national capabilities. 

The U.S. already looks weak after basically 20 years of unsuccessful wars, with the punctuation mark being the Biden administration's debacle in Afghanistan last summer. My sense, in the short term, is that China will quickly pocket whatever relative gains there may be. It's not a combatant, for one thing. Russia's now a total client state to Beijing. And the U.S. will be seen for clumsy, noncommittal strategic restraint. If Ukraine can't hold out, the U.S. will once again look the weaker, nothing like we were after World War II, when only the Soviets could claim to be a peer rival. 

No matter what happens, current events show how much things have change. The post-WWII international order is collapsing, or has already collapsed.

To even mention "containment" in the same breath sounds strange. During the Cold War, the U.S. was fully ready to back up its deterrence posture with hard force, anywhere in the world, and especially with our strategic nuclear weapons.

In any case, at the New York Times, "Biden Targets Russia With Strategy of Containment, Updated for a New Era":

WASHINGTON — More than 75 years ago, faced with a Soviet Union that clearly wanted to take over states beyond its borders, the United States adopted a Cold War approach that came to be known as “containment,” a simplistic-sounding term that evolved into a complex Cold War strategy.

On Thursday, having awakened to a violent, unprovoked attack on Ukraine, exactly the kind of nightmare imagined eight decades before, President Biden made clear he was moving toward Containment 2.0. Though it sounds a lot like its predecessor, it will have to be revised for a modern era that is in many ways more complex.

The nation that just moved “to wipe an entire country off the world map,” in the words of Chancellor Olaf Scholz of Germany, also remains a key supplier of natural gas to keep Germans and many other Europeans warm. That explains why Mr. Biden has been constrained from cutting off the valuable export. And the Russia of today has a panoply of cyberweapons that it can use to strike at the United States or its allies without risking nuclear Armageddon — an option to retaliate against American sanctions that was never available to President Vladimir V. Putin’s predecessors.

Those are only two examples of why containment will not be easy. But Mr. Biden has been clear that is where he is headed.

For three decades, American presidents described a series of Soviet and Russian leaders as “businesslike” or even “partners.” They celebrated “glasnost” and ushered Moscow into the World Trade Organization and the Group of 7 industrial nations. Washington even entertained the idea in the 1990s — very briefly — that one day Russia could join NATO. No one has talked that way in years. But Mr. Biden, who came to office last year talking about establishing a “stable, predictable” relationship with Moscow, spoke of a completely ruptured relationship on Thursday.

“Now the entire world sees clearly what Putin and his Kremlin allies are really all about,” Mr. Biden said in a speech from the White House. “This was never about genuine security concerns on their part. It was always about naked aggression, about Putin’s desire for empire by any means necessary, by bullying Russia’s neighbors through coercion and corruption.”

He vowed to make Russia pay “dearly, economically and strategically,” and to make Mr. Putin a “pariah on the international stage.” Those words might have even been familiar to George F. Kennan, the American foreign service officer who became famous as the grand strategist who invented containment, though he later warned, at age 94, that expanding NATO to Russia’s borders was a bad idea, bound to become “the beginning of a new Cold War.”

The “containment” Mr. Kennan described in his famous “Long Telegram,” an 8,000-word dispatch from the American embassy in Moscow, was primarily aimed at putting geographical limits on Soviet ambitions. But even though the Long Telegram was long, it spent the most time explaining the psychology of Stalin’s regime, which Mr. Kennan described as paranoid, viewing the outside world to be “evil, hostile and menacing.”

The similarities to Mr. Putin’s speech on Monday night, in which he accused Ukraine of triggering genocides and seeking nuclear weapons — both false claims — and the United States of seeking to use Ukrainian territory to strike at Moscow, are striking. So was his description of America’s “empire of lies.”

But as Richard N. Haass, the president of the Council on Foreign Relations, said on Thursday, “It’s much more complicated to make containment work today.”

The Soviet Union largely presented a military and ideological challenge, he noted. Yet modern-day Russia is a provider of needed fuel and minerals, “and that gives them leverage over us, even as we have leverage over them.” The force of that leverage was made clear from Mr. Biden’s answer to a question on Thursday about why Russia had not been thrown out of SWIFT, the global communication system for financial transactions.

Barring Russia from that system would be a devastating move, cutting off its government from oil and gas revenue. That accounts for about 40 percent of its incoming cash and would be the one sanction almost certain to hurt Mr. Putin like no other.

But Mr. Biden noted in his speech that “in our sanctions package, we specifically designed to allow energy payments to continue.” When asked about barring Russia from SWIFT, he added, delicately, “Right now, that’s not the position that the rest of Europe wishes to take.” In fact, the debate over SWIFT has been a source of tense behind-the-scenes exchanges, chiefly with Germany. The German objection is clear: If the country cannot pay for its gas, Russia will not deliver it.

But the second reason containment may not work is that Russia has a new, if not very enthusiastic, partner in standing up to the West: China...

Keep reading.