Headlines – 4 August, 2022

Headlines – 4 August, 2022

Russia says United States is directly involved in Ukraine war

Russia on Tuesday said that the United States, the world’s top military power, was directly involved in the conflict in Ukraine because U.S. spies were approving and coordinating Ukrainian missile strikes on Russian forces.

Russia’s invasion of Ukraine has triggered the most serious crisis in relations between Russia and the West since the 1962 Cuban Missile Crisis, when many people feared the world was on the brink of nuclear war.

Russia’s defence ministry, headed by a close ally of President Vladimir Putin, said Vadym Skibitsky, Ukraine’s deputy head of military intelligence, had admitted to the Telegraph newspaper that Washington coordinates HIMARS missile strikes.

“All this undeniably proves that Washington, contrary to White House and Pentagon claims, is directly involved in the conflict in Ukraine,” the defence ministry said.

U.S. President Joe Biden has said he wants Ukraine to defeat Russia and has supplied billions of dollars of arms to Kyiv but U.S. officials do not want a direct confrontation between U.S. and Russian soldiers.

Russia said the Biden administration was responsible for missile attacks on civilian targets in areas controlled by Russian-backed forces in eastern Ukraine.

“It is the Biden administration that is directly responsible for all Kiev-approved rocket attacks on residential areas and civilian infrastructure in populated areas of Donbas and other regions, which have resulted in mass deaths of civilians,” the defence ministry said.

Ukraine’s Zelensky Seeks Direct Talks With China’s Xi Jinping

In a new interview published Thursday in the South China Morning PostUkrainian President Volodymyr Zelensky expressed his wish for a direct conversation with Chinese President Xi Jinping.  

“I would like to talk directly. I had one conversation with Xi Jinping that was a year ago,” Zelensky said. “Since the beginning of the large-scale aggression on February 24, we have asked officially for a conversation, but we (haven’t had) any conversation with China even though I believe that would be helpful.”

Though China has taken an official stance of neutrality regarding Russia’s invasion of Ukraine, China and Russia are in frequent, high-profile diplomatic contact. In March, China joined Russia in a dissenting vote against a UN International Court of Justice ruling that ordered Russia to immediately suspend military operations in Ukraine. 

When Xi and Putin met in Beijing three weeks before the invasion, their governments issued a joint statement declaring that “friendship between the two states has no limits, there are no ‘forbidden’ areas of cooperation.” They also issued a joint statement imploring NATO to rule out further expansion in eastern Europe. 

Putin and Xi have met 39 times since 2013. As Zelensky’s requests to talk to Xi continued to go unaccepted, Russian President Vladimir Putin even had a call with Xi in June to wish him a happy birthday.

German Oil Refiner Observes “Run” On Diesel & Heating Oil, Halts Deliveries

The latest sign Europe’s energy problems are worsening is that Austrian oil and gas firm OMV AG halted crude product deliveries from storage facilities in Germany amid a “run” on supplies, Bloomberg reported. 

OMV Germany said two storage facilities in the southern part of the country “are observing a current run on heating oil and … this is possibly due to crisis-driven market shortages and thus excessive speculation and stockpiling.”

“In order to secure supplies in the short and medium term, loading will now be temporarily suspended until the Burghausen refinery has resumed production,” OMV said in an emailed response, adding Burghausen and Feldkirchen’s storage facilities will restart deliveries on Aug. 15.

A combination of issues has led to diesel and heating oil in southern Germany, Austria, and Switzerland.

  • First is the energy disruption due to Western sanctions on Russia.
  • Second OMV’s Burghausen refinery maintenance.
  • And third, falling water levels on the Rhine River have reduced deliveries of crude product shipments from the North Sea. 

The panic hoarding of diesel and heating fuel likely comes from utilities who have had to switch the type of power generation from natural gas to other crude products due to capacity constraints on the Nord Stream 1. 

German power prices have soared to a new record of more than 400 euros per megawatt-hour on the European Energy Exchange on Thursday on the prospects of a worsening energy crisis.

Germany’s Uniper Warns Of Possible “Irregular Operation” At Major Power Plant As Rhine River Runs Dry

Germany’s Uniper SE, the country’s largest utility (recently bailed out by state-owned lender KfW), warned Thursday that plunging water levels on the Rhine River have reduced barge shipments of coal to a key power plant, exacerbating an energy crunch as power prices soar to record highs, reported Bloomberg

The river at Kaub, Germany, is around 21.6 inches (55 centimeters) on Thursday and is expected to drop to 18.5 inches (47 centimeters) by Saturday, according to the German Federal Waterways and Shipping Administration. Currently, Europe’s most crucial waterway is 5.9 inches (15 centimeters) from being impassible, the threshold where barge traffic is 15.7 inches (40 centimeters). 

Uniper said the low water levels could force “irregular operation” at its 510-megawatt Staudinger-5 coal-fired power plant through the first half of September because fewer and fewer barges have been able to deliver coal as stockpiles dwindle. Rhine water levels below 40 centimeters at Kaub would halt shipments via inland waterways to the power plant, forcing shipments by land. 

On Wednesday, Riverlake, a vessel broker, said, “fewer and fewer barges can pass through Kaub.” 

Uniper’s warning about low water levels impacting operations at a coal-fired power plant is more evidence Rhine troubles are exacerbating Germany’s worst energy-supply crunch in decades as Russia reduces natural gas flows via Nord Stream 1 to just 20% capacity.

Meanwhile, German power for next year soared to a record intraday high of 410.57 euros per megawatt-hour on the European Energy Exchange on Thursday on the prospects of a worsening energy crisis. 

Besides Uniper, here’s what other German companies are saying about low water levels on the Rhine and how they seek alternatives for transporting goods (list courtesy of Bloomberg): 

BASF, chemicals

  • Company is using rail more for goods 
  • Uses Rhine to transport 4.5 million tons of raw materials and products annually to and from its main site at Ludwigshafen 
  • Already operates a vessel that can carry up to 200 tons when the so-called Pegel water measure — which is used to calculate draft — is as low as 30 centimeters 
  • Two other barges that can operate at very low water levels are on order 
  • Has already expanded cooling plants which compensate for the lower volume of water that can be taken from the Rhine in dry periods

EnBW, utility

  • The cost of shipping coal is increasing and that is pushing up its operating costs 
  • Company has built up coal inventories
  • Its plants on the Rhine and also the river Neckar both have rail connections

RheinEnergie, utility 

  • Has always used rail for its Cologne-Merkenich lignite plant

VTG, railcar operator

  • War in Ukraine has pushed up demand for coal transportation, as industries work to cut natural gas consumption 
  • Already operating at full capacity, partly due to staff shortages

Hoyer, truck operator

  • Operating at full capacity 
  • Notes lack of truck drivers

Evonik, chemicals

  • Company has already chartered additional ships and trucks 
  • Currently there are no significant constraints to its supply chains 
  • Company says it is better prepared than in 2018

Lanxess, chemicals 

  • Low water levels aren’t currently affecting logistics 
  • If Rhine water level drops further, company can switch to rail and road transportation

Don’t Look Now, But China Just Locked Down A Million Wuhan Residents Again

Submitted by QTR’s Fringe Finance

Back in April I wrote about the state of Shanghai’s latest round of lockdowns, asking whether or not something fucky was afoot (more than usual) across the pond in China. Since then, I had just assumed that things were returning back to normal and that the Winter’s lockdowns were an aberration.

But it isn’t looking that way. In fact, China’s latest actions only do more to raise my “fringe” suspicions.

As recent as this week, parts of Wuhan (and its 1 million residents) are being forced to lock down yet again because – wait for it – four cases of asymptomatic Covid were found amongst hundreds of thousands of screenings that the province provides daily.

 

With Brent crude prices tumbling below $100 a barrel, it appears the paper oil market is out of touch with the tightness reality of physical markets. 

German Artillery Donated To Ukraine Is Already Failing After Just Weeks Of Use

By Magyar Hirlap of Remix News

Barely a month since their delivery, the first German armored self-propelled guns have already ceased service in Ukraine, according to a report by German newspaper Der Spiegel.

The German Ministry of Defense was informed by Kyiv last week that an error message appeared on the cannons and that several of them needed to be repaired. According to the Bundeswehr, the reason behind the malfunction may be that the Ukrainians are firing the guns more intensively than the technology is capable of.

This means that the stress on the loading systems may be too high. Another problem could be that the soldiers reportedly fire the units from too far away with the special ammunition; the smart grenades used by these cannons were meant for shorter-range, precision hits.

The Bundeswehr explained that misuse of the weapons could have contributed to a more accelerated wear and tear. Despite the problems, however, they agreed to supply Ukraine with additional weapons packages.

At the same time, the arming of Ukraine by the West raises several problems. The unlimited flow of weapons can see arms easily end up on the black market or lost. Several European countries have already warned that weapons have on occasion been redirected to other nations. The authorities in Sweden, for example, revealed that anti-tank weapons have already appeared in the circles of criminal gangs in Sweden.

Meanwhile, security policy expert Robert C. Castel drew attention to the fact that Western weapon systems — the Javelin anti-tank missile and the Stinger anti-aircraft missile — can be used against civilian and industrial targets as well as military ones. According to him, it is only a matter of time before these weapons deliveries have unintended consequences. These weapons could still be lurking somewhere in Europe for many decades, as the modern equivalent of mines and air bombs left over from the World Wars, he added.

Poll Finds Only 1% Of Americans See Russia As A Major Problem

Authored by Paul Joseph Watson via Summit News,

A new Gallup poll has found that a mere 1 per cent of Americans view Russia as a major problem, with far more concern expressed about inflation, bad governance and the state of the economy.

In a revealing illustration of to what degree people have lost interest in ‘the current thing,’ whereas 9 per cent of Americans viewed relations with Russia as the most important problem facing the country back in March, that number has now plummeted.

How Ukrainians Sell NATO-Supplied Weapons Abroad

Ukrainian soldier armed with US Javelin ride along Khreshchatyk Street, during a military parade to celebrate Independence Day in Kiev, Ukraine. File photo - Sputnik International, 1920, 04.08.2022Ukrainian soldier armed with US Javelin ride along Khreshchatyk Street, during a military parade to celebrate Independence Day in Kiev, Ukraine. File photo - Sputnik International, 1920, 04.08.2022

WASHINGTON DID NOT SUGGEST RENEWING ARMS CONTROL NEGOTIATIONS, DESPITE BIDEN CLAIMING THEY DID, MOSCOW HAS SAID.

The US did not come up with any proposals regarding an arms control agreement that could potentially replace the landmark New START, or Strategic Arms Reduction Treaty, Russian Foreign Minister Sergey Lavrov said on Wednesday.

“At the current state of foreign relations development, they didn’t even propose to renew these talks… No requests on reopening this negotiating process have been made,” Lavrov told a press conference during his trip to Myanmar.

He noted that the West “has developed a habit of making announcements on the microphone and then forgetting about them.”

Lavrov also commented on the possible participation of China in arms control negotiations, saying that the decision will be made only by Beijing itself. “The Americans know our stance on this matter perfectly well,” he said.

According to Lavrov, the latest talks on replacing New START after it expires in 2026 were held last year. After two rounds of discussions on the matter, the US side took a break, he said.

The Russian foreign minister’s remarks come after US President Joe Biden said that Washington is ready to negotiate “a new arms control framework” with Russia.

“Today, my administration is ready to expeditiously negotiate a new arms control framework to replace New START when it expires in 2026. But negotiation requires a willing partner operating in good faith,” Biden said on Monday, referring to the landmark document that puts caps on the number of strategic nuclear missiles and warheads held by Russia and the US.

Biden also urged Beijing to join the dialogue on nuclear disarmament, saying that China “has a responsibility” as a nuclear weapons state “to engage in talks that will reduce the risk of miscalculation and address destabilizing military dynamics.”

Moscow has repeatedly called on the US to unconditionally extend the deal for another five years, while Washington during Donald Trump’s presidency floated various proposals on its amendment, saying in particular, that it wants China to join. Shortly before the treaty was set to expire in February 2021, it was extended after Biden was sworn into office.

Beijing, however, rejected attempts by the former US administration to drag it into the framework and declined to join talks on the expansion of the US-Russia agreement. China has argued that its nuclear arsenal is too small compared to the stockpiles maintained by the US and Russia.

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