Russia cutting off oil?

[AtW]

Why do you need a pipeline to China?

http://www.worldpress.org/Europe/898.cfm

Look at date of the article - 2002, notice Yukos - Putin jailed owner of that company and took over his assets, one of the reasons was to prevent him from making this pipeline happen. Now there is new one being made but capacity is not that good - most importantly the Chinese did not want to pay the prices they can sell gas in Europe, it's not because they can get cheaper price elsewhere but because smart Chinese don't want to finance the enemy near their borders, EU on the other hand seems happy that billions go into KGB pockets.

[AtW]

Actually MAD is very simple indeed, childish even. But real nevertheless.

If you look at Russian statements in the last few days, one of the top military officials mentioned nuclear response to USA - they are saying such powerful words, this very quickly escalated and needs to be put to end as soon as possible.

[sasguru]

Here is example of the kind of money the Chinese are prepared to pay - they loaned cash to Putin's mates to buy illegally company of the jailed Khodorkovsky but they made condition to be paid back in oil at the price of around $16 dollars per barrel. This was at the time when oil was already at 45-50.

Sorry but that's bollux. Given the amount of oil the Chinese consume are you saying they get all of it out of payments in kind? And that they can continue to do so?

[Incognito]

Look at date of the article - 2002, notice Yukos - Putin jailed owner of that company and took over his assets, one of the reasons was to prevent him from making this pipeline happen. Now there is new one being made but capacity is not that good - most importantly the Chinese did not want to pay the prices they can sell gas in Europe, it's not because they can get cheaper price elsewhere but because smart Chinese don't want to finance the enemy near their borders, EU on the other hand seems happy that billions go into KGB pockets.

I was only referring to the fact that you don't necessarily need a direct pipeline.

Are they not on about building a direct one now anyway?


http://www.scandoil.com/moxie-bm2/oi...erhaul-3.shtml

[AtW]

Sorry but that's bollux. Given the amount of oil the Chinese consume are you saying they get all of it out of payments in kind? And that they can continue to do so?

Look, this is factual stuff. Do you think Putin is stupid and did not try to diversify into China? The fact of the matter is that the Chinese refused to buy it at world prices, perhaps they had other considerations (I think so) as well.

If Russia can't sell oil to EU then you bet Chinese won't pay anywhere near world price, they never do - they trade with dodgy African dictatorships and arm them because they get resources at prices much cheaper than they'd have to pay if they were buying them on exchanges.

As I said the Chinese are not stupid in their strategy, unlike Putin and his henchmen.

[AtW]

I was only referring to the fact that you don't necessarily need a direct pipeline.
Are they not on about building a direct one now anyway?
http://www.scandoil.com/moxie-bm2/oi...erhaul-3.shtml

They are making some but they are not designed to carry large capacity of oil - pipelines of that kind is not something done in a day or two, it takes years. If suddently there is an embargo on any exports of oil from Russia then after a few days they will have to shutdown oil wells, it will cause very serious damage to production from those wells.

Frankly a simple ban on foreign companies making any consulting or equipment for oil industry to Russia would be a big hit - the only oil equipment that is done well in Russia are the pipes.

[sasguru]

Look, this is factual stuff. Do you think Putin is stupid and did not try to diversify into China? The fact of the matter is that the Chinese refused to buy it at world prices, perhaps they had other considerations (I think so) as well.

If Russia can't sell oil to EU then you bet Chinese won't pay anywhere near world price, they never do - they trade with dodgy African dictatorships and arm them because they get resources at prices much cheaper than they'd have to pay if they were buying them on exchanges.

As I said the Chinese are not stupid in their strategy, unlike Putin and his henchmen.

So let me get this straight. The Chinese refuse to pay world prices for oil and are getting all their oil from African dictatorships?

[AtW]

So let me get this straight. The Chinese refuse to pay world prices for oil and are getting all their oil from African dictatorships?

I am telling you what I know - the Chinese refused to pay world prices for bulk deliveries of oil from Russia.

The Chinese also arm and cover African tin top countries in UN because those countries allow Chinese companies to mine resources, I am certain they don't pay world prices for that - big bribes to corrupt leaders of those countries yes. That's why the Chinese are covering Darfur genocide stuff because such cover gives them very practical benefits - resources that are cheaper than buying from elsewhere.

[sasguru]

I am telling you what I know - the Chinese refused to pay world prices for bulk deliveries of oil from Russia.

The Chinese also arm and cover African tin top countries in UN because those countries allow Chinese companies to mine resources, I am certain they don't pay world prices for that - big bribes to corrupt leaders of those countries yes. That's why the Chinese are covering Darfur genocide stuff because such cover gives them very practical benefits - resources that are cheaper than buying from elsewhere.

Ok I'll put you out of your misery. They buy most of their oil from Iran at normal "European" prices.
Although some comes from Africa this is a small fraction of their total.
Now back to molesting squirrels.

[AtW]

Ok I'll put you out of your misery. They buy most of their oil from Iran at normal "European" prices.

I mentioned Africa in regards to previous metals that they get there - certainly not at world prices.

Ok, China buys lots of oil from Iran, the country that in many respects blocked from international affairs. Do you seriously think China pays full world price for this deal with Iran? It's certainly not the case in my view - prove me if it is with good references. If China was buying oil at world prices, why would they need to do it from Iran? The whole point from buying from those countries is that you get materials much cheaper.

http://www.chinadaily.com.cn/english...ent_387140.htm

"China's oil giant Sinopec Group has signed a US$70 billion oil and natural gas agreement with Iran, which is China's biggest energy deal with the No. 2 OPEC producer.

Under a memorandum of understanding signed Thursday, Sinopec Group will buy 250 million tons of liquefied natural gas over 30 years from Iran and develop the giant Yadavaran field."

Notice - this is a long term fixed price agreement, they don't pay market rates - they pre-agreed price for many years to come!

So, that's $70 bln for 250 mln tons of gas, that's $280 per ton. It's not oil but lets look at equivalence of energy sources - http://www.eppo.go.th/ref/UNIT-OIL.html :

"1 ton of LPG = 1.22 tonne crude oil"

1 ton of crude oil is about 7.33 barrels, so 1 ton of LPG is equivalent to 8.94 barrels, at current price of $115 this LPG at current world prices should have cost China not $280 they pay for it, but $1028 (nearly 4 times more - and I took current "low" oil price - calculate when oil is $150 yourself). See the difference? That's why Chinese deal with tin-pot countries and that's why they will never pay world price when taking on Russian oil, especially if they know Russia can't sell it elsewhere.

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I think my point about China buying energy (at least as much as they can) at cheaper than world prices has been proven comprehensively.