Recently, news came from Russia that the Russian President said during a talks with Astana and Turkey on the 13th that Turkey has now become the most reliable route to transport natural gas to Europe, and the Russian President proposed to build a gas supply hub in Turkey, which is equivalent to a platform, which will not only be used for future natural gas supply and transit, but also for pricing.
Especially now, the prices of natural gas in the world are ridiculously high. If there is a new hub, the Russian side will easily adjust at a normal market level, without any political color or are easily restricted by the West. Moreover, the Russian President also believes that Turkey has become the most reliable route for Russia to transport natural gas to Europe. So why did the Russian President build Türkiye into a natural gas hub platform? What are the considerations behind it?
First of all, let’s take a look at the current European energy landscape. The whole Europe has been deceived by the United States and has to impose an energy embargo on Russia without Russian oil and natural gas. However, after a long time, several major European industrial powers can really not withstand it. If the people of those small countries in EU can reduce the use of air conditioners and water heaters and can still make do with this, then if the industrial powers such as , the largest economy in Europe, , are not as easy as industrial powers soaring, and these companies can’t afford the electricity price. How can they produce? Will the companies have to go bankrupt? Wouldn't the millions of workers behind it also be unemployed? It's worth it.
So many countries are actually secretly using Russian natural gas in private, but this has also led to a series of stricter sanctions against Russia by the West and other countries. Recently, we have found that several places in the Nord Stream natural gas pipelines have exploded unexpectedly, and a large amount of natural gas emerged from the sea. Although I don’t know who exploded it now, it is definitely not a good thing for Russia. This proves that the traditional natural gas pipelines transported by Russia to Europe have safety risks, so Russia needs to choose a new gas supply hub and find a safe and controllable place to stabilize its energy business.
The second point is that Russia has already learned from the past when laying natural gas pipelines, that is, the previous natural gas pipelines were from Ukraine. During the Merkel period, Russia and Germany had agreed and promised that Germany would give Ukraine a toll, and then negotiated with the United States to not intervene. This made Nord Stream 2 finally delayed the construction, but who would have thought that the outbreak of the Russian-Ukrainian conflict this year suddenly caused safety hazards to the part of the Russian Nord Stream pipeline laying in Ukraine.
In addition, Nord Stream 2 cannot start construction normally now, so if this pipeline comes directly from Russia and is transported to European countries through Europe, then it is very likely that some countries that are passing through will be instigated by the West and may not necessarily cause any trouble.
So if Russia chooses to establish a natural gas hub in Turkey now, Turkey, as a Central Asian country, will not be so easily instigated by the United States. Moreover, Turkey has suffered a great loss from the United States in the past and is deeply trapped in the US dollar debt. Because it was overly reliant on the US dollar, Turkey's current domestic inflation rate is close to 90%, so Türkiye is also de-dollarization and is trying new cooperation opportunities again. So I think the energy cooperation established by Russia and Turkey on this background should be relatively safe.
Let’s look at the third point. If Russia wants to build a natural gas hub in Turkey this time, there is another important purpose, which is to set prices. Although Russia was sanctioned by the West before, a lot of natural gas could not be sold directly to Europe, it can also be sold to Europe by a third country, so that Western sanctions can be bypassed.
like India and China, they bought a large amount of cheap natural gas from Russia in advance, and then sold it to Europe at a high price or even 3 times and 4 times. Therefore, Russia's energy business was not delayed, and it was even better than before. rubles and appreciated, and China and India have also made a lot of money, and only Europe has to pay more.
Now the Western countries led by the United States have also discovered that this is wrong, so they have increased their investments again to plan a new round of sanctions on Russian energy. This time, we will directly target the Russian oil industry.
It is understood that these countries will set upper limits on Russian oil prices and seek to establish an operating mechanism for price ceilings. Because Europe and the United States have the monopoly position of the US dollar and the euro in international settlement, Western countries intend to limit Russian oil prices through financial means. After Western countries measure Russia's oil production and processing costs, they only allow you to sell a cost price, and they do not allow you to make another penny. So in this way, even if Russia can transfer oil to India or China first and then sell it to Europe, its returns will be restricted, and the countries in the middle can naturally not make so much difference. Is there any other meaning for such a trading author?
So will G7, the behavior of setting a price limit, also likely to expand to other energy sources such as Russian natural gas in the future? I think it's hard to say, so I have to prepare in advance, so you see, Russia now needs to find its pricing power in energy to be safer.
Now, the Russian side wants to build a gas supply hub in Turkey and establish its own pricing power so as not to be disturbed by Western countries. I think a large number of local currency settlement are bound to be included, rather than using the US dollar or the euro, which is also a good thing for de-dollarization.
So to speak of this, Türkiye's hub can not only sell Russian natural gas to Europe, but also sell it to Asian countries more conveniently. In the future, Russian natural gas will be more convenient when it sells Russian natural gas to India.
If China and India can establish long-term energy trade with Russia, I believe this market share is no smaller than that of Europe. You should know that China and India can have 1/3 of the world's population together, and these two countries should be the two largest developing countries in the world. They are large energy consumers, and we can use local currency to settle. This is also beneficial for promoting the internationalization of our RMB and being optimistic about the hegemony of the US dollar.
If at present, this proposal is still in the stage of ideas, then more discussions will be needed in the future. There are issues related to laws, commercial economy and technology, etc., which need to be slowly practiced and verified, but I think it is completely feasible in technology.
Because Russia and Turkey had a good cooperation in energy projects such as Turkey Creek, I think it is possible to build a new natural gas pipeline. If this plan is ultimately feasible, then I think the West's increase in energy embargo on Russia will have to be short, which will only aggravate their own energy crisis and inflation crisis, and live a frozen winter. What do you think about this?