European Gas Prices Spike 30% After Russian Supply Cuts Oil Price
EU gas solidarity complicated by lack of fuel sharing deals Reuters
The European Union clinched a deal this week to cope with a gas supply crisis, but to make it work member states need to establish bilateral pacts to share gas and, right now, most have no such agreement in place.
Only six such deals have been secured, leaving most of the EU’s 27 countries without firm terms on how and when they would share gas in a supply crunch, or the financial compensation they would give or get for doing so.
“(Bilateral deals) are really … the only thing that will hold at the end of the day if there is a real supply crisis,” Christian Egenhofer, associate senior research fellow at the Centre for European Policy Studies, said.
“They organise the legal stuff, the compensation, the financial but also the infrastructure constraints,” he said.
- Southern Water announces hosepipe ban amid UK drought fears The Guardian
Southern Water has become the first mainland UK utilities company to announce drought measures, including a hosepipe ban, after record dry temperatures across the country.
- US State Dept approves potential sale of F-35 fighters, munitions to Germany Inquirer
The U.S. State Department approved a possible foreign military sale to Germany of F-35 fighter jets, munitions and related equipment for an estimated cost of $8.4 billion, the Pentagon said on Thursday.
The potential deal for the advanced stealth fighter came after German Chancellor Olaf Scholz pledged an upgrade to his country’s military following Russia’s invasion of Ukraine.
- ‘Recession is in the air’: German economy stagnates in 2nd quarter Reuters
The German economy stagnated in the second quarter, data showed on Friday, with the war in Ukraine, the pandemic and supply disruptions bringing Europe’s largest economy to the edge of a downturn.
Gross domestic product was unchanged quarter on quarter in adjusted terms, the federal statistics office said. A Reuters poll of economists had forecast growth of 0.1%.
However, the economy did better in the first quarter than originally reported, with the office upwardly revising that quarter’s growth to 0.8% from 0.2%.
- Swiss National Bank posts record H1 loss, says no policy impact Reuters
The Swiss National Bank reported a first-half loss of 95.2 billion Swiss francs ($100.08 billion) on Friday, the biggest six-month loss since the central bank was founded in 1907.
Stock market declines, falling bond prices and the franc’s appreciation severely dented the value of its massive foreign currency holdings.
The SNB reported a second-quarter loss of 62.4 billion francs, also its worst ever quarterly performance.
“The loss is historic, but most of it is an unrealised paper loss relating to lower valuations of bonds and shares,” said Credit Suisse economist Maxime Botteron, who said the result was unlikely to be a worry for the SNB.
“I don’t think this will have any effect on the SNB’s monetary policy at all, the only impact may be on the public finances because the SNB’s payout to the government and cantons could be less next year.”
- Spain inflation highest since 1984; new record for eurozone area Al Jazeera
Spanish consumer prices have risen at the fastest pace since September 1984, national statistics for July showed, as inflation in the European countries using the euro currency shot up to another record.
Preliminary data released on Friday by Spain’s National Statistics Institute (INE) said prices increased 10.8 percent year-on-year this month, up from 10.2 percent in June.
- Hungary’s Orban expects gas deal with Russia this summer Reuters
Hungary expects to sign a deal with Russia on additional gas shipments of 700 million cubic metres by the end of summer, Prime Minister Viktor Orban told state radio on Friday.
- Finland debating stop to tourist visas for Russian citizens Guardian
Finland is debating whether to stop issuing tourist visas to regular Russian citizens, a move that would bring it into line with its Baltic neighbours but has already prompted Moscow to threaten a “very negative reaction”.
Russians have long crossed their country’s 830-mile border with Finland to holiday, shop in border stores and travel onwards to other European destinations – and Helsinki remains the only EU member to routinely grant tourist visas.
But Moscow’s brutal invasion of Ukraine and Finland’s subsequent application to join the Nato defensive alliance have led many Finns to question whether the practice can any longer be justified, while others say a blanket ban would be unfair – and costly.
Asia and Oceania
- China’s factory activity seen expanding at fastest pace in a year Inquirer
China’s factory activity likely expanded at the fastest pace in a year in July, a Reuters poll showed on Friday, as production in COVID-hit manufacturing hubs resumed after emerging from lockdowns while supply chain disruptions eased.
The official manufacturing Purchasing Manager’s Index (PMI) is expected to have risen to 50.4 in July – the highest in 12 months – compared with 50.2 in the previous month, according to the median forecast of 24 economists polled by Reuters.
- China signals it could miss economic growth target BBC
China has signalled that it may miss its annual economic growth target, as Covid restrictions weigh on the world’s second largest economy.
On Thursday, the Politburo - the ruling Communist Party’s top policy-making body - said it aims to keep growth within “a reasonable range”.
It did not mention the official growth target of 5.5% it had earlier set.
China is continuing to pursue a zero-Covid policy that has put major cities into full or partial lockdowns.
In a statement after its quarterly economic meeting, the 25-member Politburo, which is chaired by President Xi Jinping, said leaders would “strive to achieve the best results possible”.
- China’s Politburo to ensure delivery of unfinished homes to prevent mortgage-boycott crisis from escalating SCMP
China’s top leadership has for the first time underscored the importance of ensuring the delivery of homes, signalling the government’s commitment to avert a brewing crisis that involves creating a bailout fund to get cash-starved developers over the finishing line.
Local governments will be responsible for ensuring the delivery of housing projects, according to a statement issued on Thursday after a meeting of the Politburo, the Communist Party’s top decision-making body.
A stable property sector and use of policies to fully support the real demand for homes and ensure their delivery will be a top priority, the statement said, reiterating President Xi Jinping’s oft-repeated comment that “houses are for living, not for speculation”.
The statement comes amid a mortgage boycott by homebuyers that has delivered another blow to the already bruised Chinese property sector. Over the past few weeks, buyers of more than 320 residential projects in 95 Chinese cities have collectively refused to make mortgage payments unless construction of their homes resumes, according to real-time updates on “WeNeedHome” on GitHub, Microsoft’s collaborative code-sharing platform, which is commonly used to avoid censorship in China.
- Hong Kong endures longest streak of sweltering nights in 138 years Asia News
Hong Kong has already endured 22 sweltering evenings as of July 27, setting a new record of “warm nights” since the city started keeping weather records in 1884, the Hong Kong Observatory said.
It’s disgusting that China is using its orgone generators to change the climate of Hong Kong and reduce the ability of the protestors to resist. Like how Mei became a symbol of Hong Kong resistance, I now say that Cloudbusting by Kate Bush was revealing this whole time how the see see pee was going to enslave mankind, and should be lauded for providing us with the warning.
- Following Xi-Biden call, Taiwan to deepen close security partnership with U.S. Reuters
Taiwan’s foreign ministry said on Friday that it will continue to deepen its close security partnership with the United States, after U.S. President Joe Biden and China’s leader Xi Jinping spoke on Thursday.
In the call, Xi warned the U.S. against playing with fire over Taiwan, highlighting Beijing’s concerns about a possible visit to the Chinese-claimed island by U.S. House Speaker Nancy Pelosi.
- Japan’s factory output zooms as China eases COVID curbs Reuters
Japan’s factories ramped up output at the fastest pace in more than nine years in June as disruptions due to China’s COVID-19 curbs eased, a welcome sign for policymakers hoping the economic outlook will improve.
Separate data showed retail sales rose for the fourth straight month in June, supporting the view that rising consumption helped the economy return to growth in the second quarter after contracting in January-March.
- Syrian ship carrying ‘stolen Ukrainian barley, flour’ docks in Lebanon, Ukrainian embassy says Inquirer
A Syrian ship under U.S. sanctions has docked in the northern Lebanese port of Tripoli carrying barley and wheat that the Ukrainian embassy in Beirut told Reuters on Thursday had been plundered by Russia from Ukrainian stores.
“The ship has traveled from a Crimean port that is closed to international shipping, carrying 5,000 tonnes of barley and 5,000 tonnes of flour that we suspect was taken from Ukrainian stores,” the embassy told Reuters.
“This is the first time a shipment of stolen grains and flour reaches Lebanon,” the statement said.
- Iran inks 2 agreements with China to facilitate agricultural exports Tehran Times
Iranian Agriculture Ministry has signed two cooperation documents with China’s General Administration of Customs to facilitate the access of Iranian exporters to the Chinese markets, IRIB reported.
According to Sadati-Nejad, the first document was regarding the health requirements for the export of fresh citrus fruits from Iran to China, which is very important considering the annual production of 5.5 million tons of citrus fruits in the country.
The second document was regarding Iranian honey exports to China, the official explained.
- Africa will receive a humanitarian shipment of Russian fertilizers EU Reporter
The Russian company Uralchem, one of the largest global producers and exporters of nitrogen, potassium, and complex fertilizers, will supply its products (urea or compound fertilizers) to Africa on a free of charge basis.
This project of Uralchem is implemented in accordance with the UN Sustainable Development Goal No.2 “Eradicate hunger, ensure food security and improve nutrition and promote sustainable agriculture”. The project at this stage provides for humanitarian delivery of the first batch of 25 thousand tons to the Republic of Togo (Lomé port).
- Protests against military administration paralyse Guinea capital Al Jazeera
Protests against Guinea’s military government and its handling of plans to return to democracy have brought the capital to a standstill, with organisers saying one person was killed.
The National Front for the Defence of the Constitution (FNDC) said one person died after being hit by a bullet in the Conakry suburb of Hamdallaye, and that several others had been injured during the protests on Thursday.
The FNDC is an influential political coalition that called for the demonstrations last week to condemn the military’s “unilateral management” of a return to civilian rule after it seized power in 2021. The former ruling Rally for the Guinean People and the National Alliance for Change and Democracy, another coalition of parties and associations, also called on their supporters to join the demonstrations.
- ‘Doesn’t sound like a recession’: Biden optimistic despite economy contracting Inquirer
President Joe Biden tried to soothe Americans’ worries about the strength of the economy on Thursday, after new data showed it had contracted for two quarters in a row.
Biden and top White House officials touted several positive facts about the U.S. economy, including that employers are still hiring, unemployment is at 50-year lows and manufacturers are still investing.
“That doesn’t sound like a recession to me,” Biden told reporters.
Anxieties about the economy could tank Biden’s fellow Democrats during the Nov. 8 midterm elections for control of Congress.
The president’s approval rating has fallen to a record low of 36%, according to Reuters/Ipsos polling, with the economy listed at the top of voters’ concerns as higher grocery, gas and housing bills mount.
- The dollar is closing in on its biggest monthly loss against the yen in 2 years, even as the Fed hikes interest rates aggressively Business Insider
The Japanese yen is on track for its largest monthly gain against the US dollar since 2020, despite the Federal Reserve and Bank of Japan adopting differing views on how to tame soaring inflation.
The dollar has slipped 1.75% against so far this month, meaning it now trades at just over 133 yen. This is still only 5% below a 24-year high above 139 reached two weeks ago, but it’s the largest one-month drop since July 2020.
The greenback has seen its dominance fade somewhat, despite the Fed’s back-to-back 75 basis point interest rate hikes, which tend to increase the value of a country’s currency. In contrast, the BoJ has taken a dovish approach to taming inflation and is one of the few central banks that hasn’t yet delivered any rate hikes, despite consumer price pressures running at their highest in almost eight years.
Analysts said the dollar’s diminishing strength reflected investors' fears about the overall state of the US economy.
- US set to pass $369bn of climate spending after Manchin U-turn Climate Change News
After a dramatic U-turn from holdout Senator Joe Manchin on Wednesday, the US is set to pass a bill which includes $369bn in climate and energy spending.
The Senate Democrats said the bill was “the single biggest climate investment in US history by far” and would put the US on track to reduce emissions by 40% on 2005 levels by 2030. The US’s target, set by president Joe Biden last year, is to reduce emissions by 50-52%.
Grants and loans will help organisations like ports, schools, waste disposal companies and the postal services buy zero-emission vehicles. Up to $20bn in loans will help car companies build new clean vehicle factories and $2bn in grants will help them convert existing factories to clean vehicles.
Companies wanting to build factories producing green technologies like solar panels or wind turbines can apply for $10bn in investment tax credits and heavy industries like cement and steel will be given $6bn in grants and tax credits for emissions reductions.
American homeowners will be able to apply for $9bn in partial refunds and $1bn in grants for home energy efficiency improvements.
The bill also contains spending on adapting the US to the effects of climate change. There is funding to make forests more resistant to fires, farming more resistant to drought and coasts more resistant to sea level rise and storms.
Fossil fuel companies whose facilities leak methane, a particularly potent greenhouse gas, into the atmosphere, face fines.
- Venezuela and Colombia agree to re-establish diplomatic ties Al Jazeera
Colombia and Venezuela will appoint new ambassadors in their respective capitals when Colombian President-elect Gustavo Petro takes office next month, authorities said, in an effort to rebuild diplomatic relations after years of tension.
The Ukraine War
- Russia accuses Ukraine of killing POWs with HIMARS system Al Jazeera
Russia has accused Kyiv of striking a jail holding Ukrainian prisoners of war in separatist-controlled eastern Ukraine, killing 40 detainees including some who had defended Mariupol’s Azovstal steel plant.
The Russian defence ministry said a HIMARS missile strike hit a pre-trial detention centre in Olenivka, in the separatist-held region of Donetsk, overnight on Friday.
“Forty Ukrainian prisoners of war were killed and 75 wounded,” the ministry said in its daily briefing, adding that the centre held fighters from the Azov battalion.
- Russian forces make small gains in Donetsk region, Ukrainian military says CNN
The Ukrainian military has conceded that Russian forces have been able to make small gains near the Donetsk towns of Soledar and Vershyna in eastern Ukraine.
Russia has been making a push in that area of the Donbas for the past several weeks but with limited gains.
“Okay, we have these awesome HIMARS that have killed every Russian soldier twice over and they’ve had to conscript more people at gunpoint and they are extremely demoralized and they have ran out of tanks and they have had zero training and they suck and are evil, but, yes, we are still being beaten on the battlefield. But, like, they’re doing human wave attacks, so really it’ll just make them lose harder later on.
Climate and Space
- Global Coal Demand On Track To Match Record Oil Price
Soaring natural gas prices are giving rise to coal demand around the world, with consumption set to match this year the record-high from 2013, and further jump to a new all-time high next year, the International Energy Agency (IEA) said on Thursday.
This year, global coal demand is expected to rise by 0.7% to 8 billion tons if China’s economy recovers as expected in the second half of 2022, according to the IEA’s July 2022 Coal Market Update. This is despite an economic slowdown and still uncertain recovery in China after the COVID-related lockdowns in the second quarter of 2022. If the IEA’s forecast pans out, global coal demand this year will equal the demand from 2013, when coal consumption hit a record high.
Dipshittery and Cope
For bad takes, awful analysis that makes you wonder why these people get paid, predictions that reveal a staggering lack of knowledge, and hope for a future that would be worse than the present.
- After Five Months, The Russians Finally Managed To Destroy Some Ukrainian Drone Equipment Forbes
I read this and thought of @comi.
In five months of hard fighting, Russian forces shot down at least 12 of Ukraine’s Turkish-made Bayraktar TB-2 drones.
The words “at least” are really fucking loadbearing in that sentence. “At least 10 people were killed in World War 2."
But they didn’t succeed in targeting the ground stations that are necessary for the TB-2’s operations—until now.
On Thursday, a video circulated on social media depicting what appears to be a Russian Lancet loitering munition—a “suicide drone,” if you will—striking a twin-mast radio relay, reportedly in Kherson Oblast in southern Ukraine.
- I’m Ukraine’s Foreign Minister. Putin Must Be Stopped. NYT
I’m really not in the mood to read this one. I’ll do the first paragraph and then I’m stopping.
Russia, apparently, is ready for a cease-fire. The door to negotiations, the Kremlin’s spokesman said last week, has never been closed. No one should be fooled. Whatever its officials may say, Russia remains focused on war and aims to ruin Ukraine and shatter the West. The sight of Odesa, hit by Russian missiles just hours after a deal was reached to allow grain exports from southern ports, should dispel any lingering naïveté. For Vladimir Putin, a cease-fire now would simply allow his depleted invasion forces to take a break before returning for further aggression.
Yeah, this sucks. You know what, I’ll even throw in the last paragraph.
In that spirit, we in Ukraine call on our partners to increase their support and reject Russia’s fake peace proposals. Nor should they pay any attention to the narrative, amplified by Russian propaganda, of so-called war fatigue. Every war is tiresome, but we need to endure. The price of losing — a crushed Ukraine, a shattered West and a resurgent Russia — is too high to countenance anything else.
Who gives a shit, dude? It does make me wonder what kind of articles the Nazis would be writing before the Battle of Berlin if the internet existed back then and Germany’s Foreign Minister wrote an article like this a week before the city was taken. Or any other final battle that ended an empire throughout history. “Fellow Romans, we must stand firm against the external threats, as our glorious ancestors have done for a millenium! Resist the Germanic barbarians about to reach our gates! Settle for no idiotic peace deal they may suggest!"
- Russia Is Making Heaps of Money From Oil, but There Is a Way to Stop That NYT
It’s an oil price cap, isn’t it? Oh my god, they’re still on that shit?
The United States and its allies are leaning heavily on economic sanctions to punish Russia for its invasion of Ukraine. But a key element in that strategy, restrictions on Russian oil exports, mostly appears to be causing pain for ordinary people in other countries. European nations, in particular, are causing considerable damage to their own economies without reducing Russia’s oil revenue.
Nations seeking to help Ukraine are aiming at the wrong target. They have focused on reducing Russia’s energy exports instead of reducing Russia’s earnings from energy exports. Russia is exporting less oil but, in a perverse twist, it is earning more money, according to the Center for Research on Energy and Clean Air, based in Finland. The sanctions have raised prices, more than offsetting the decline in exports. In May 2022, Russia earned 883 million euros from oil exports, up from 633 million euros in May 2021.
The situation is about to take a turn for the worse. New sanctions that the European Union and Britain have agreed to impose on Russia by year’s end are likely to drive oil prices even higher. Some analysts warn that the price for a barrel of oil could exceed $200, well above the spike in the early weeks of the war, when oil prices topped out around $124. That could easily push Western economies into a recession.
The Biden administration has a plan that could avert this crisis. It would establish a buyer’s cartel — an agreement among Russia’s customers to put a price ceiling on Russian oil. That ceiling would be significantly lower than the current market price, sharply reducing the role of Western consumers in funding the Russian military. But the price would still allow Russia to make some profit, so that it has an incentive to export its oil to members of the cartel. Some of the key participants in the plan, including the United States, have banned the importation of Russian oil, but other nations that America hopes to enlist, notably India, continue to import large volumes of Russian oil.
It is an audacious and untested idea. It also appears to be the best available option. If it works, it could deprive Russia of revenue without devastating the economies of nations that are trying to support Ukraine.
Except for the fact that Russia has said that it will stop exporting oil to anybody who tries to do an oil price cap. That’s a fairly important part of this entire plan.
Constructing a cartel is not easy. The United States has already secured the agreement in principle of the other members of the Group of 7, a coordinating body for the major democratic economic powers. American officials, including Treasury Secretary Janet Yellen, are working with their counterparts to hammer out the details. The buyers’ cartel would be strengthened if other big buyers of Russian oil, notably India and China, could be persuaded to participate. That seems unlikely. But U.S. officials argue the cartel could still increase pressure on Russia by allowing nations that are not participating to extract larger discounts, too.
Maintaining a cartel is also hard. Because the participants can benefit by cheating on the price ceiling, policing a price-fixing agreement is notoriously difficult. But in this case, there may be a plausible enforcement mechanism. A key piece of the new sanctions by the European Union and Britain is a ban on insuring tankers that carry Russian oil. Shippers need insurance to navigate canals and to enter harbors. European companies dominate the market; in April and May, 68 percent of Russian oil exports traveled on tankers insured by European businesses. That measure could be modified to ban insurance for tankers with oil purchased at a price above the cartel’s ceiling.
The Russian government has sought to forestall the plan by warning that it would refuse to go along with it. “As far as I understand, we won’t be supplying oil to those countries which would impose such a cap, and our oil, oil products will be redirected to the countries which are ready to cooperate with us,” Elvira Nabiullina, the governor of Russia’s central bank, said at a news conference last week. Analysts, however, say that if a cartel is established, Russia’s real choice would be between accepting its terms and leaving a large share of current oil production in the ground.
BUT YOU NEED THE OIL MORE THAN THEY NEED THE OIL MONEY! I love that these absolute fucking idiots can see that fucking with Russian oil to try and reduce Russian oil profits has made their oil revenues actually go up, and instead of internalizing that lesson and going “Ah, dang, guess we shouldn’t try that again!” they decide to try again!
- No matter what the Kremlin says, the sanctions against Russia are working and ‘catastrophically crippling’ its economy: study Business Insider
Five months into the invasion of Ukraine, Russia’s economy is imploding from sweeping international sanctions and a corporate exodus, a Yale University analysis has found. The analysis, released July 20, was led by Jeffrey Sonnenfeld, a professor at the Yale School of Management.
The study’s findings stand in contrast to studies of Russia’s economy that show it’s holding up better than expected. Many of those analyses, forecasts, and projections draw from Russian government economic releases, which are becoming “increasingly cherry-picked; partial, and incomplete, selectively tossing out unfavorable statistics while keeping favorable statistics,” the Yale team wrote. “Indeed, the Kremlin has a long history of fudging official economic statistics, even prior to the invasion.”
Russia’s economy has not rebounded and is in fact “reeling,” the Yale authors found. They used private Russian-language data sources and sources like high-frequency consumer data for their analysis.
“From our analysis, it becomes clear: business retreats and sanctions are catastrophically crippling the Russian economy,” the authors wrote.
One reason Russia appears so resilient is because the Kremlin has been flooding the economy with “artificial liquidity” and propping up the ruble with “draconian capital controls,” wrote the Yale team.
“And that’s cheating. It’s not fair for a government to try and save their own economy instead of letting the free market - which, of course, America controls - decide to tank it. That’s what socialism is, or something."
In reality, the corporate exodus out of Russia has reversed nearly 30 years worth of foreign investment, as those foreign companies accounted for 40% of the country’s GDP, the Yale authors added.
“Putin is resorting to patently unsustainable, dramatic fiscal and monetary intervention to smooth over these structural economic weaknesses, which has already sent his government budget into deficit for the first time in years and drained his foreign reserves even with high energy prices,” they wrote.
In April, Russian Finance Minister Anthon Siluanov said the country will draw from its rainy-day fund to cover the deficit. The move, the Yale team wrote, points to a Kremlin that is “fast running out of money, despite intentional obfuscation.”
The report’s authors call on the international community to keep pressure on Russia over the Ukraine war: “Defeatist headlines arguing that Russia’s economy has bounced back are simply not factual — the facts are that, by any metric and on any level, the Russian economy is reeling, and now is not the time to step on the brakes.”
- The US is in a technical recession, but other data tells a different story. Here’s what to know. Business Insider
I’m not much for ’70s rock n' roll, but I do keep an ear to government data — and yesterday’s GDP print kicked up a lot of hubbub.
This much I know for sure: GDP doesn’t tell the whole story.
“This is, of course, only true for when we’re doing badly, or a bad country’s economy is doing well. Stare directly at China and Russia’s GDPs and extrapolate the entire universe from them. For us, it’s just a small piece of the puzzle. American exceptionalism, baby."
There’s a lot of moving parts. Let’s break it down.
The technical definition of a recession is two consecutive quarters of GDP contraction, which the government just confirmed Thursday — the economy shrank by 0.9% last quarter after contracting 1.6% in the first quarter.
Back-to-back declines like we just saw are widely regarded as indicators of a recession, but there’s more at play.
First, the US economy is not officially in a recession until the National Bureau of Economic Research says so — and they haven’t yet.
“Yeah, you dirty proles, you might THINK it’s a recession, but the smart people don’t think it is yet, and that’s all that matters. In unrelated news, it’s bizarre how the trust in government institutions has gone down so much over time."
In Thursday comments, Janet Yellen pointed to the strong job market as reason to believe the US economy isn’t in a broad slowdown. There’s been a flurry of payroll additions and unemployment remains at reasonable levels.
The country is on track to surpass its pre-COVID payroll count this August, 30 months after the virus struck.
The same feat took 76 months after 2008, and 48 months after 2001.
And all the while Americans have been emptying their wallets. We spent $681 billion at retailers and restaurants last month, and even adjusted for inflation, that’s a healthy clip.
Even though the GDP just shrank in the last three months, spending was still up.
So — are we in a recession?
Yes, according to one measure. No, when you tie in all measures.
I said this recently, but just imagine China’s GDP decreasing in two consecutive quarters and then Chinese econonists arguing in this exact same language about how they’re not actually in a recession. Imagine the reaction of the western media to this. Imagine the headlines. “Chinese state propaganda tries to convince citizens that despite recession’s clear definition, China is not in a recession”.
- Biden’s Unlikely Gang of Four Takes Aim at Iran and China Bloomberg
US President Joe Biden’s trip to the Middle East had plenty of headlines, including “the fist-bump heard around the world” with Mohammed bin Salman, the crown prince of Saudi Arabia. Another key event was the US and Israel agreeing, more or less, to use military force if necessary to prevent Iran from obtaining a nuclear weapon.
But one of the less-reported elements of the journey was a summit of a seemingly odd collection of nations dubbed the I2U2 group: India, Israel, the United Arab Emirates and the US. This unconventional idea grew out of a conversation last year at the Washington home of the UAE’s ambassador, Yousef Al Otaiba, and included Yair Lapid, now Israel’s prime minister.
What impact could this loose alliance have on global issues?
It has echoes of a more established four-nation grouping, the alignment in the Pacific of Australia, India, Japan and the US. Officially known as the Quadrilateral Security Dialogue, unofficially as “the Quad,” it was launched in 2007 largely due to the efforts of Shinzo Abe, the recently assassinated former prime minister of Japan. The Quad has coordinated diplomatic policy and military exercises to balance the rise and size of China in the western Pacific and East Asia.
Adapting the idea of a structured coalition to the Middle East and South Asia, the Biden administration has curated this grouping carefully. The nations of I2U2 are even more diverse than the Pacific quad. Two are relatively tiny in terms of population, with Israel and UAE just below 10 million residents; the US is in the middle at 330 million, while India will become the most populous nation in the world in a few years, surpassing China.
It is also a diverse group in terms of culture and governance. Israel is a vibrant, multireligious democracy (some would say perhaps a bit too vibrant, as it heads for its fifth election in four years). The UAE is an Arab monarchy, but more than 85% of the residents are expatriate workers, roughly half of whom are from India. The US is a classic (if turbulent) Western democracy, while India has divergent ethnic, linguistic and racial divisions melded into a shaky democratic structure.
I was going to make a joke about calling Israel a “vibrant, multireligious democracy” but then the descriptors just got worse and worse. I would absolutely love to see this person describe fascist Italy or Germany or Spain. “Nazi Germany is a colorful and industrial, if a little strict, nation in the heart of Europe, constituted of many different racial groups!"
But what the nations share is more important than the differences.
I simply cannot fathom the absolute chasm of differences between these countries. Such massive discrepancies in opinions towards minority groups, the role of democracy, what to do about economic inequalities… how on earth is this ragtag group of completely different countries kept together? It seems utterly impossible!
Each has security concerns that will make enhanced military cooperation attractive. Israel and the UAE are part of the Abraham Accords, a diplomatic and structural opposition to Iran started during the Donald Trump administration and continuing under Biden. India has a more ambivalent relationship with Iran (including investment and purchasing of Iranian hydrocarbons), but opposes its nuclear program strongly and objects to Iranian support to arch-enemy Pakistan. While this quad is not overtly anti-Iranian, over time the US may use it to pull India toward a more alarmed view of Tehran.
Like, this sucks so fucking bad. “This quad is not overtly anti-Iranian - two of them have been crying and pissing their pants and begging on their fucking hands and knees to go to war with Iran for the last two decades if not longer, one is along for the ride because it’s literally just a dude and his family ruling a bunch of immigrant workers in the desert building statues with plagues reading “Look on my works, ye mighty, and despair!” on them, and India doesn’t technically think that we should eradicate every last Iranian, but I’m sure we can convince them!"
If a quad like this was situated against the US and not Iran, this group would be called a fascist terrorist communist socialist anarchist totalitarian enemy of democracy and freedom across the world, and an existential threat to America and everything it stands for, which must be at a minimum entirely destroyed and ideally all knowledge of them also purged from all history books and the internet. But as it’s against Iran, they can go “Dude, we swear, we aren’t talking about how to invade you and strip you of your natural resources to keep the global capitalist machine going for another 5 years in a last ditch effort to put the rate of profit up a bit before we all go hide in our bunkers and wait for the end of the world. Do you really think we would do that?"
- China’s ‘Zero Covid’ Mess Is Infecting Asia’s Economies Forbes
Ten years of President Xi Jinping trying to increase Chinese soft power in Asia risks becoming a big zero.
For that, Xi has his stubborn embrace of a “zero Covid” strategy rapidly backfiring on the second-biggest economy to blame. The anemic 0.4% growth China produced in the April-to-June period year-on-year is a galaxy away from the 5.5% output Xi earmarked for 2022.
And judging by the Asian Development Bank’s latest numbers, it’s winning Xi few friends in the region. China’s gross domestic product miss is dragging neighbors down, too. ADB just lowered its growth forecast for developing Asia to 4.6% from 5.2% this year largely thanks to slowing Chinese growth.
Obviously, this author should be in prison for life for crimes against journalism, that’s not really up for debate - but it is extra funny to compare this to the fact that the US has been shrinking for the last half-year, while China has still been growing. If America had been growing faster than China during this, then fine, whatever, you’ve owned me or whatever, but this is literally cope. As the American domestic capitalist machine shits itself to death, the billionaires are telling the journalists to go and point at some other country and distract everybody, and this is the result. A pile of sewage which is essentially arguing for the deaths of millions in order to make the big line go gooder.
For when bad people accept reality, though often not fully and not for very long.
- JPMorgan says Russia has had little problem rerouting its oil exports, meaning the expected plunge in production never happened Business Insider
Russia has been able to reroute its oil exports away from Europe without serious disruptions, JPMorgan has said, adding that the expected drop in output “never happened.”
Better-than-expected Russian production, along with the release of oil from global strategic reserves, helps explain the recent drop in crude prices, the bank’s head of commodities research Natasha Kaneva said in a note to clients.
Bloomerism and Hope
For events that show that a better, more equitable, and happier world is possible than the neoliberal hell we inhabit.
- Boston Starbucks Workers Go On Strike Against Union-Busting Popular Resistance
Unionized Starbucks workers at the 874 Commonwealth Avenue location in Boston, Massachusetts are on strike indefinitely, demanding guaranteed hours, adequate staffing, and the removal of a store manager who has created a “chaotic and hostile work environment,” including making racist and homophobic comments against staff and customers.
- US Labor Fights Back Against Amazon’s Expansion Into Healthcare Popular Resistance
On July 21, Amazon announced that the corporation would buy One Medical, a national chain of healthcare clinics and services based in San Francisco, for $3.9 million. In response, unions and labor organizations marched in San Francisco’s Financial District against the deal on July 26. The march was attended by the newly-formed Amazon Labor Union (ALU), with ALU president Chris Smalls leading chants at the helm of the protest, as well as the California Labor Federation, San Francisco Labor Council, ALU, California Nurses Association, Teamsters Local 665, and Service Employees International Union-United Healthcare Workers West (SEIU-UHW).
- Lufthansa Workers Strike Over Wages Popular Resistance
The ver.di union, one of the unions representing workers at the German airline Lufthansa, has called for a new strike on Wednesday, July 27, to demand a 9.5-percent wage increase to address inflation. The strike affects ground workers in maintenance and towing.
“The situation at airports is degenerating and employees are increasingly under pressure and overworked due to severe understaffing, high inflation, and no raise for three years,” Christine Behl, a ver.di leader, told AFP. This flows from a shortfall of 7,000 employees in Germany’s aviation sector, the result of precarious jobs marked by low wages, along with the significant number of jobs lost during the pandemic.
- Trade Unionists Take A Stand For Jobs, Pay, Pensions And Conditions Popular Resistance
The rail network was brought to a standstill today as thousands of RMT and TSSA members walked out over jobs, pay, pensions and other conditions.
RMT is in dispute with Network Rail and 14 train operators while TSSA is striking at Avanti West Coast.
Speaking from the Euston picket line, RMT general secretary Mick Lynch said the union had received an “inadequate” pay offer from Network Rail last week.
He said: “It’s a pay offer over three years which is nowhere near the rate of inflation. “And the conditions that they wish to impose on that are not acceptable to the members.”