Putin is winning the oil war: Katusa
There was a spate of stories about how he is the chess master and outmaneuvering the West and outmaneuvering Mr. Obama and this and that and the other. And right now, he's presiding over the collapse of his currency, a major financial crisis and a huge economic contraction. That doesn't sound like somebody who has rolled me or the United States of America.The ruble has fallen sharply in the past few weeks and there are current stories coming out of Russia about potential bank runs. Last week the ruble became the world’s worst performing currency. This week, however, the Russian currency does appear to be stabilizing-- it's back up by 30%. So have sanctions and falling oil prices sunk Russia?
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Not really says Marin Katusa, author of “The Colder War,” and chief
energy investment strategist at Casey Research. Katusa believes that
falling oil prices will eventually give Russia the upper hand and deeply
injure the U.S. energy industry. The falling ruble makes Russian oil
less expensive and more desirable to other countries—Russia also
produces oil quite cheaply while the American shale industry has a
larger cost of operation. Russia is more than able to weather the
current storm, Katusa says. “They have a $200 billion a
year trade surplus. They have over $400 billion in reserve currency.
They’ve increased their gold reserve. They have much lower debt to their
GDP than America. So yes there’s pain in the economy… [but] it's far
from terminal.”
On Tuesday the Ukrainian Parliament voted to drop its “non-aligned” status and begin work towards a NATO membership. Russian Foreign
Minister Sergei Lavrov said this “unproductive” move would only
increase tension between Russia and Ukraine. Katusa believes that this
is the beginning of another cold war. “The Ukraine parliament
only did this after Obama guaranteed hundreds of billions of dollars in
military support to fight the Russians,” he says. “And what is critical
here is we all know that the logarithmic rule in war when you commit
hundreds of millions - it means billions of dollars and through these
actions Obama has declared the colder war on Russia.”
Katusa believes that this move
will result in more atrocities on both sides of the border, but mostly
in Ukraine. According to Katusa, sanctions have only made it so that
Russia must work more closely with emerging markets like China. “We’ve
seen billions of dollars of increase in the currency swaps between China
and Russia and it’s going to continue,” he says. Currently about 9% of
China’s oil exports come from Russia but Katusa predicts that number
will grow significantly in the decades to come.
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- finance.yahoo.com/news/putin-is-winning-
the-oil-war... Dec 25, 2014 · From Yahoo Finance: Is Russia rolling over America? ... In an exclusive interview with CNN’s Candy Crowley last Sunday, President Obama addressed critics ...
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