Ukraine Fatigue Is Becoming A Very Real Concern In The US and Europe

On Saturday the Washington Post reported that the Biden administration is privately urging the Ukrainian government to indicate an openness to negotiations with Russia and downplay its refusal to hold peace talks unless Vladimir Putin is removed from power. According to the Post’s sources, the aim is not to force Kiev to enter negotiations, but to make certain Ukraine has the support of other partner nations, especially in Europe. As the war in Ukraine rages on it causes more damage to the world economy and there are growing signs that voters in Europe are souring on the prospect of supporting Ukraine’s war over a prolonged period. For that matter, there are signs in the United States that Ukraine Fatigue has established a beachhead. The midterm elections on Tuesday should prove to be an accurate barometer of the American public’s tolerance of Washington’s continuing blank check, no-holds-barred support of Ukraine.

 This winter will likely provide the greatest gauge for Europe’s tolerance for future support of the Ukraine war. Despite assurances from the European Union and several Western European nations about national and continent-wide storage of natural gas, concern remains about the effects a particularly cold winter could have in store for Europe. Industrial output is an area of particular concern. A hypothetical energy shortage in Germany, for example, will force Berlin to put restrictions in place that could have long-term negative consequences on the German economy. Added to these concerns in Europe is the latest wave of Russian missile and drone attacks against Ukraine’s energy infrastructure. These strikes have been quite effective, despite the Ukrainian government’s insistences otherwise. In fact, Kiev is warning of significant disruptions to power, heat and water services over the winter if the attacks continue. Many Europeans believe it will only be a matter of time before Kiev turns to Europe to provide the materials and finance to repair its energy infrastructure. Yet with much of Europe facing its own energy worries in the coming months, Zelenskiy and the Ukrainian government could find his benefactors on the continent to be in a reluctant mood to provide help.

European Energy Crisis Update 24 October, 2022

With winter fast approaching, attention is shifting to Europe and its energy crisis. The primary question on the minds of geopolitical analysts, economists and politicians is: Can Europe avoid an energy disaster this coming winter? The continent has done everything possible to prepare for the coming season. According to the EU, natural gas storage stood at 93% among EU member-states as of 17 October. Whether this statistic is fact or hopeful thinking remains to be seen. Consumption has to remain moderate for Europe to make it through the winter season in good condition. But despite consumption reduction demands and measures, the most critical factor in natural gas and overall energy consumption and demand in Europe will be weather conditions. If the winter is a cold one, energy supplies will be hit hard and fast. A good number of European industries are already taking steps to contend with energy shortages.

Adding to the dilemma perhaps, is the attention Russia is paying to the Ukrainian power grid. Recently, cruise missile and suicide-drone strikes have been launched against Ukrainian energy facilities resulting in major blackouts across large parts of the country. If these conditions continue and worsen into the winter months, Ukraine could be in need of material and financial assistance to repair its energy facilities at a time when Europeans are dealing with their own energy shortages. As it stands right now, despite many European governments remaining enthusiastic about providing Ukraine with whatever it asks for, many EU citizens are growing weary of the sacrifices that people in Hamburg and Copenhagen are forced to make for people in Lviv and Kiev.

A scenario where Europeans are  asked to conserve their own energy demands in order to benefit Ukraine could result in a wedge being driven between Europe and Kiev. Time will tell.

Sabotage In The Baltic

As expected, evidence surrounding the underwater explosions along the Nord Stream 1 and 2 pipelines in the Baltic Sea on Monday is leaning towards sabotage as the cause. And just as predictably, fingers in Europe and Washington are instinctively pointing east towards Russia. Two explosions caused large leaks in both undersea natural gas pipelines. The Nord Stream pipelines originate in Russia.

Now experts are trying to decipher the meaning behind the attacks while energy and security officials in Europe are now forced to deal with the possibility of further attacks on fuel infrastructure sites. Retired senior German intelligence official Gerhard Schindler told German news channel Welt that Russia is the only real suspect behind the attack.  “An unnoticed, conspiratorial damage to pipelines at a depth of 80 meters in the Baltic Sea requires sophisticated technical and organizational capabilities that clearly point to a state actor. Only Russia can really be considered for this, especially since it stands to gain the most from this act of sabotage.”

What exactly can Moscow expect to gain from sabotaging its own natural gas pipelines, provided they are responsible? For starters, with Nordstream 1 now out of commission for an extended period because of the explosions, Europe is caught between two chairs. With winter approaching and concern about whether there will be sufficient energy supplies to get through the season, the eastern option is now completely off the table. This means that now European nations that are heavily dependent on Russian natural gas, especially Germany, have to find new energy sources to replace what was permanently lost following Monday’s explosions and leaks.

Despite official claims by Berlin that its natural gas stockpile is robust, German officials continue to seek new energy sources for the short term with increasing urgency. Perhaps the German government miscalculated the stockpile numbers and Germany really does not have anywhere near sufficient natural gas available. If this turns out to be the case, expect the blowback from it to be decidedly unpleasant around Europe and the rest of the world.

European Energy Concerns Deepen

For months European Union officials have claimed the Union should prepared if Russia decides to halt gas shipments to Europe indefinitely. However, Gazprom’s decision halt Nord Stream 1 deliveries, ostensibly due to needed turbine repairs, has shown the earlier EU confidence might’ve been premature. Energy markets are volatile right now with prices surging. If this was not bad enough, many European energy companies are facing margin calls at the worst possible time. Collateral cash is not available in the amounts needed, mainly owing to the volatility of energy markets, which has been sparked in-turn by the energy. The chips are down, and the red light is flashing on the continent as leaders and energy ministers try and come to terms with the crisis now staring directly at them.

Belgian Prime Minister Alexander De Croo warned today that swift action must be taken to prevent a broad economic shutdown continent-wide. “A few weeks like this and the European economy will just go into a full stop. Recovering from that is going to be much more complicated than intervening in gas markets today. The risk of that is de-industrialization and severe risk of fundamental social unrest.” De Croo made these comments in an interview with Bloomberg. Tomorrow 27 EU energy ministers will meet in Brussels to discuss a plan for intervention in European energy markets. As some analysts have said earlier this week, Europe is now facing a “Lehman Event” and swift intervention could be the only tool strong enough to stave off major disaster.

Even though European officials continue to claim gas storage supplies are sufficient enough to get EU nations through the winter, there’s increasing worry that if even one member-state must resort to blackouts and other energy restrictions it will create a domino-effect throughout the entire EU. Given the current state of energy in Europe this is a very possible prospect once winter sets in.

Scholz Pushes New Pipeline Initiative

With Germany in the midst of a deepening energy crisis German Chancellor Olaf Scholz is now calling for the construction of a pipeline which would reach from Portugal to Central Europe. Naturally, the goal of such a pipeline would be to reduce Germany’s dependence on Russian gas. Even though Germany and other European nations have made strides to shrink their dependence on gas shipments from Russia, it has become clear that reliance will not diminish before the winter season arrives. Scholz has broached the topic of a pipeline with the officials from Portugal, Spain, France and the European Union. Portuguese Prime Minister António Costa has been pushing for the pipeline proposal to be examined by the EU since the early days of Russia’ invasion of Ukraine. Germany and other nations with a heavy reliance on Russian gas paid the issue little mind.

Now Germany appears intent to push the matter, even publicly admitting regret that a sincere effort was not made earlier. Of course, the geopolitical situation has changed. Now that Germany is anxiously seeking other sources for natural gas supplies, a pipeline from Portugal to Central Europe suddenly seems to be an ideal solution.

Unfortunately for Berlin, the energy troubles confronting Germany are not strictly limited natural gas. Water levels on the Rhine River dropped to a critical low on Friday. This will affect barge traffic on the river and subsequently restrict the flow of essential commodities to inland Europe even more. Not exactly welcome news and a firm indication that the energy crisis facing Europe is a long way from being brought under control.