EU sanctions on Russia could double gas prices – World Bank
Thursday, June 12th, 2014 | Posted by Jim W. Dean
EU sanctions on Russia could double gas prices – World Bank
… from Russia Today, Moscow, …with Jim W. Dean, VT commentary
[ Editor’s note: We are seeing game war and chaos theory being played out on steroids with all of the geopolitical insanity going on now.
The goal is to undermine any cause and effect analysis by 99% of the public, so that when someone pulls the trigger on the next “big event”, only those who have been framed within recent memory will be targeted for blame.
We saw not the same, but similar moves prior to WWI, for example the secret agreements which were in place.
Most folks even today would interpret that to mean that the British people were not aware that their government had committed the country to intervene on the continent with the proper trip wires in place to prevent a consolidated power from emerging.
But actually, only a HANDFUL of the cabinet ministers (centered around the Foreign Office) were aware of these secret agreements, which made those not included livid when the hammer fell. But they could say nothing about it publicly at the time due to the threat of public revolt toward the government… and their class.
There is huge traffic going on in the Intel community now about how, despite the huge funds spent on security post-911, it was all undermined from the beginning due to deep-cover penetrations actually being in charge of setting most of it up. Think Michael Chertoff.
And because very senior political people were involved, the moron rank and file mid-level people just accepted that there was nothing they could do to their bosses, which is not really true… because many of them have been the ones who took their oaths seriously and not what we call the “paycheck patriots”.
Many of those working at the mid level are selected for their demonstrated manipulation quotients, and you have a similar situation in the military, including the officer corp and the brass. For example, Israeli Intel knows more about them than their wives and mothers.
VT readers know that the Neo-Cons and Israelis are in it up to their eyeballs, but few know that major international crime syndicates are also, who have former top politicians fronting for them.
This brinkmanship with the US (and whoever else is behind it) wanting to rearrange the European gas-supply situation in a major way is a causus belli, on the scale of tossing a live grenade around in a circle thinking that there will only be one unfortunate party, when it will be everybody. What that tells you is that the parties running the game are not in the circle.
If you want to get even more depressed, ask yourself if our elected officials in Congress could have any major effect on bringing some sanity and security back to this god-awful situation. We all know what the answer to that is. Welcome to American life while it is failing as a state. And ask yourself who would benefit from this?
I can tell you that in the US, the list runs 30,000 to 40,000, including more than a few of America’s most famous names… and worldwide, about 300,000. Dealing with them is what it would take to fix it.
Fortunately, virtually all of their names are known. If they think a purge of the loyalists will save them, they will learn that they can defend themselves quite well.
But they have their lists, also, and the advantage of taxpayer funds and law enforcement at their command, a dicey situation indeed.
NATO even has its arrest and liquidate list, for when they feel that is necessary. If they really feel threatened, they will do a major false flag, declare national emergencies, and then kill off all of their opponents in a month. They have been training units (contractors mainly) to do this for some time, who don’t even know that is what they are for. They will be given a cover story.
These elites have shrewdly anticipated that there would be a major move against them for some time. They have used the time to plan minutely what they would do. And it is more scary than you could possibly imagine. More on this later… Jim W. Dean ]
– First published June 11, 2014 –
Russia and the EU would both suffer if sanctions escalate, energy markets the most, according to a World Bank report. The loss of the European market would cut Russian government revenue by 10 percent of GDP, and European gas prices would jump 50 percent.
Most dependent EU countries could see higher gas prices. Countries from Central and South East Europe like Germany, Italy, Hungary, and Poland are up to 80 percent dependent on Russian gas imports, says the World Bank.
Increased tension between Russia and the EU is a key downside risk to regional forecasts.
“Should tensions further escalate, more intrusive sanctions, possibly interrupting trade and banking flows, cannot be ruled out,” the World Bank report said. “Given the close economic interdependence between the EU and Russia, the escalation of sanctions would likely impose large economic costs, damaging recoveries in both.”
In Russia, oil revenues represent 9 percent of GDP and a quarter of government revenues, and “a loss of EU export markets could reduce government revenues by 10 or more percent of GDP,” according to World Bank analytics.
Europe depends on Russia for nearly 30 percent of its natural gas supplies. In case of supply disruption or sanctions, the economic costs could be high. Additional LNG imports to Europe from elsewhere in the world would boost global demand and prices.
However even assuming no boost to LNG prices, EU import costs would rise by 50 percent or about 0.15 percent of GDP says the report. The losses would be much higher for major importers.
Russian economic growth in 2014 is expected to be at 0.5 percent. The longer outlook forecast is a bit more optimistic with 1.5 percent in 2015 and 2.2 percent in 2016. Global GDP growth is projected to gradually rise from 2.4 percent in 2013 to 2.8 percent in 2014, 3.4 percent in 2015 and 3.5 percent in 2016.
The World Bank has revised down its forecast for economic growth in the developing world this year from 5.3 percent to 4.8 percent. The report shows that 2014 will become the third consecutive year of growth below 5 percent and urges developing nations to make economic reforms in order to boost growth potential. 2015 will come with a gradual GDP growth by only 5.5 percent.
“The global economy got off to a bumpy start this year buffeted by poor weather in the United States, financial market turbulence and the conflict in Ukraine,” says the document.
Overall the Ukraine situation is estimated to have eroded 1 percentage point of growth among low and middle-income countries in the region.
In Central Asia much weaker Russian growth has slowed the economies there because it is a major trading partner, and a source of remittances. Declining metal and mineral prices and domestic capacity constraints have also affected the economy.
High-income countries will experience 1.9 percent growth this year compared to 1.3 percent in 2013 and 2.5 percent by 2016, becoming the main impetus for acceleration.
High-income economies are projected to inject an additional $6.3 trillion to global demand over the next three years, which is significantly more than the $3.9 trillion increase they contributed during the past three years, and more than the expected contribution from developing countries.