WP: Even Putin’s Oligarchs Aren’t Buying His Baloney

Gazprom has provided further evidence of “catastrophic idiocy.”

Further evidence — not that any was needed — of the catastrophic idiocy of Vladimir Putin’s war in Ukraine is found in an internal study commissioned by Gazprom, a state-controlled energy firm and largest company in Russia. As revealed by the Financial Times, the analysis concluded that the loss of European customers for Russian natural gas in response to Putin’s aggression cannot be made up by exports elsewhere for at least a decade.

Deputy opinion editor and columnist at The Washington Post David von Drehle noted that the lone economic bright spot in a country that Senator John McCain properly described as “a gas station masquerading as a country” has been snuffed by Russia’s deranged leader.

According to him, Russia is not a country that can afford to destroy profitable businesses. Its entire economy is smaller than that of Texas.

“Yet that’s what Putin has done. Proof of the damage to Gazprom came last month, when the state-controlled company reported its first annual loss of the 21st century — the first of many to come,” David von Drehle added.

With spigots to the West turned off and China dragging its heels on building the second pipeline in Russia, the report concluded, according to the Financial Times, that Gazprom will not return to profitability before 2035.

“Putin’s lackeys have silenced critics while flooding Russian media — and gullible Westerners — with claims that China has saved the sanctioned economy and victory over Ukraine is nigh. Now, from the upper reaches of the state kleptocracy, comes proof that even Putin’s oligarchs aren’t buying his baloney,” states the author of the material.

The analyst urged not to believe Putin’s “desperate hogwash” about Russian strength and Russian victory. The backbone of his economy, Gazprom — a company far more important to its country than any single company has ever been to the United States — has shown us the truth.

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Exporting large amounts of natural gas can be done in two ways: through pipelines and (when refrigerated to very low temperatures) in tanks as liquid. Having invested little in liquefied natural gas (LNG), Gazprom is heavily dependent on pipelines, and its pipelines are heavily dependent on Europe.

Pipelines are not built overnight. In fact, nearly 28 months after Putin’s failing invasion of Ukraine, China has yet to agree to the concept of a second pipeline from Russia to offset partially the loss of European exports.

This is the opposite of propaganda. It is a truth that Russian insiders are admitting to themselves. Their golden goose has been roasted on the whim of their delusional boss, and next up for the Russian economy is likely to be Venezuelan-style inflation, as the cost of the ruinous war is paid in currency that has scant economic output to bolster it.

It’s not difficult to imagine that the appearance of this sober conclusion in the Western media is a cry for help from inside the increasingly oppressive Russian state.

It’s time for President Biden to ensure the taming of Russia by reversing one of his most shortsighted panders — his regulatory “pause” on development of facilities for exporting LNG. This action — a sop to the climate caucus of the Democratic base, which wrongly believes that all fossil fuels are equally bad — will slow what had been the rapid emergence of U.S. exports as an alternative to Russian gas. In fact, for the first time, last year the United States surpassed Russia in sales of natural gas to the European Union.

As an environmental policy, the LNG pause is a flop. Use of abundant natural gas supplies — the United States has become the world’s leading energy producer — to replace much dirtier coal in generating electricity has been a major factor in the decline of carbon emissions in the United States. Natural gas can do the same in other heavily coal-dependent countries, notably China and India, where emissions are rising dangerously. Opposition to LNG is mere virtue signaling; matters of war and climate are too serious for the White House to indulge in it.

The pause is also bad for the security of the United States and its allies. By invading a neighbor and waging a war of unremitting criminality, Russia has shown itself to be an insufferable threat to Western safety and humane values. Don’t take it from me. Take it from the people who know Russia best: its neighbors.

Poland’s spending on defense rose about 70 percent last year. Sweden, after going it alone for nearly 75 years, joined NATO in March (following Finland) and has hiked its defense budget by just above 30 percent. Lithuania boosted defense spending by nearly 30 percent. And so on. Since Putin’s annexation of Crimea in 2014, Europe as a whole has increased spending on defense every year.

Those countries don’t want to resume their dependence on Russia when the war in Ukraine finally ends. They want alternatives to Russian gas, and for the peace of the world, the United States should give them one.