Japan needs Russian gas

“IF NOT ME, THEN WHO? AND IF NOT NOW, WHEN?’
First and last president of the Soviet Union, General Secretary of the Central Committee of the Communist Party of the Soviet Union (CPSU), Mikhail Gorbachev was one of the most important world figures of the last quarter of the 20th century.

Like any important political figure, he evoked and evokes extreme feelings of approval and disapproval, appreciation and contempt.

This leader, whose first “memory was hunger,” was a decent, well-intentioned, principled man who tried to save the unsaveable. The collapse of his country was his personal tragedy.

When he takes over the reins of the country he is fully aware that he has to face two colossal problems that plague it.

On the one hand, the outrageous productive stagnation: “Imagine a country that flies into space, launches Sputnik, creates such a defense system and cannot solve the problem of women’s pantyhose. No toothpaste, no soap, no basic necessities of life. It was incredible and humbling to work in such a government.” And on the other hand, the essential non-existence of the rule of law: “I studied the law and saw that it was not respected in our country.”

Against them, he could be satisfied with an identical management of the country to the previous leaders. His greatness and ultimately his tragedy was that he came forward determined to fight them: “If not me, then who? And if not now, when?”

His great achievement was the tombstone he put on 40 years of Cold War, freeing humanity from the danger of nuclear annihilation; and his great failure to implement his visions in a society that was completely unprepared to accept them.

Gorbachev “will go down in history as a man who initiated historic transformations that benefited humanity and the Russian people” (Henry Kissinger).

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DOES ANYONE KNOW WHAT SUPER PROFITS ARE?
French Economy Minister Bruno Le Maire certainly doesn’t know, telling employers on Tuesday “I don’t know what super profit is.”

“I know that companies have to be profitable, that’s all I know,” added the French government’s number two.

On the contrary, the Prime Minister, Elizabeth Bourne, seems to know what super profits are. On Saturday, he told Le Parisien newspaper that he did not want to “close the door” to a tax on the “surplus profits” of businesses, which is a demand of the left. But he added that he would prefer any company that can “lower prices for the consumer and give purchasing power to its workers.”

Whether they know or don’t know what super profits are, there is little chance, judging by their statements, that the government will proceed with additional taxation of companies that have shown extraordinary profits due to rising energy prices or bottlenecks in supply chains.

Source: AFP, France Info

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JAPAN NEEDS RUSSIAN GAS
New, but pre-announced circumvention of sanctions, this time by Japan. The reason is that the country cannot do without the Russian Sakhalin-2 oil and gas project, given that about 60% of the 10 million tons of natural gas exported from the Far Eastern island go to Japan, covering almost 10 % of her needs.

Under the guidance of the government concerned about the winter energy supply, the groups Mitsubishi Corp. and Mitsui & Co. are set to file for participation in Sakhalin Energy, the entity created on August 5 by the Russian authorities, which replaced the joint venture Sakhalin Energy Investment (SEI), in which Mitsui held 10% and Mitsubishi 12.5%. Gazprom is expected to acquire 50% of SEI, while British group Shell intends to withdraw and sell its 27.5% stake.

JERA, a joint venture between Tokyo Energy (Tepco) and Chubu, and a major importer, has already signed an agreement with the new operator to supply 2 million tonnes of liquefied natural gas (LNG) per year until 2029.

LNG prices in Northeast Asia have been rising steadily. On Friday, it hit $70.50 per million British thermal units (MMBtu) for October delivery, up 23.7% from prices for September delivery — well above the December 2021 record ($48 per MMBtu).

Despite the sanctions it signed up to, Japan has always ruled out pulling out of a project it considers “extremely important to the energy security” of the archipelago. The US had “shown understanding” in this decision, as Finance Minister Koichi Hagiuda explained at the end of July.

Source: Le Monde, Reuters

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Japan needs Russian oil and gas from Sakhalin-2, as they meet almost 10% of its needs.

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THE BIGGEST MILITARY BLOCK IN HISTORY
The Vostok-2022 military exercises, which begin tomorrow, September 1, in the Far East, are not the largest. In 2018, an estimated 300,000 Russian, Chinese and Mongolian soldiers were trained, while this year around 50,000 are estimated.

However the symbolism has changed, and is particularly powerful.

In 2018, the Kremlin sought to project an image of military superiority and demonstrate deepening ties with Beijing.

At Vostok-2022, Russia wants to demonstrate that its military capabilities remain intact despite rising costs and pressure from its invasion of Ukraine.

Above all, however, it is India’s participation that dominates the symbolism, as its presence forms the “largest military bloc in history”, Russia-India-China.

India’s involvement in the high schools is justifiably confusing, as tensions between Beijing and New Delhi are rife, most recently China’s allegation of “militarization of the Taiwan Strait”.

It seems that India’s very friendly ties with Moscow led to its participation in the exercises. Moreover, the military exercises are part of India’s foreign policy of “strategic autonomy”, with which it seeks to balance competing powers and pursue its own interests.

However, the symbolism of its participation is important, especially if combined with the BRICS’ aspirations to turn to their national currencies for mutual settlements, abandoning the dollar.

Source: Financial Times, RFE/RL

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Vostok-2022 exercises.

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BACK TO THE 70’S
In a research note released on Monday, Goldman Sachs estimated that UK inflation could peak at 22.4% and gross domestic product could fall by 3.4% if energy costs continue to rise by the current rate.

The estimate comes after British households’ energy bills are expected to rise by 80% in the coming months, taking their average annual bill to €4,131 from €2,294 and exacerbating the country’s existing cost of living crisis.

The bank also said the UK economy is likely to contract in the fourth quarter of 2022, as well as the first two quarters of 2023. “We now expect the deepening cost of living crisis to push the UK economy into recession later this year “, the note says.

Goldman Sachs’ gloomy forecast for the UK economy is in line with Citibank’s forecast last week that UK inflation will top 18% in January 2023.

Source: Bloomberg, CNBC

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Britain’s Chancellor of the Exchequer, Dennis Healy (left), and Prime Minister, Harold Wilson, in 1975, when inflation had reached rates comparable to current Goldman Sachs forecasts.

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JACQUES-LOUIS DAVID
Jacques-Louis David (August 30, 1748 – December 29, 1825) was perhaps the greatest neoclassical painter. He painted many masterpieces, Napoleon patronized him, and David painted him and other leading political figures.

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Jacques-Louis David, ‘Portrait of Madame de Verninac’, 1799.

The article is in Greek

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