Ukraine/Russia

Ukraine has more pluses than minuses for climate

26 Sep 2022

The Russian invasion has prompted other countries to boost gas production and burn more coal. Climate diplomacy is on ice. But this crisis will also prompt a dash for cheaper and more secure renewable energy. That helps the fight to slow global warming, says Hugo Dixon.

Italy’s right-wing winners inherit poison chalice

26 Sep 2022

Nationalist Giorgia Meloni, EU-sceptic Matteo Salvini and convicted former PM Silvio Berlusconi scored an election victory. Despite campaign unity, they disagree on sanctions and spending. The rivalries risk undermining the high-debt nation’s ability to tackle its energy crisis.

Uniper’s new bailout mixes scars and consolations

21 Sep 2022

Germany’s 8 bln euro capital injection heavily dilutes the stricken energy group’s investors and hands main shareholder Fortum a big loss. The Finnish group does gain from exiting the mess, and Berlin might one day profit from the rescue. But neither side will be celebrating.

Oil price cap will harm, not help, Asia

15 Sep 2022

The U.S. says countries ignoring a G7-led price cap against Russia can leverage it to negotiate discounts. But even if the policy works and lowers short-term prices, India and China’s massive long-term oil needs make it risky to mess with price signals that spur fresh supply.

Europe can shrug off Putin’s Chinese gas Plan B

14 Sep 2022

With exports to its key European market shrinking fast, Moscow hopes to hike gas exports to the People’s Republic. But last year these were just 7% of EU sales, and logistics and sanctions complicate the shift. It need not deter Europe’s talk of a Russian gas price cap.

Europe energy fallout will cascade down the years

12 Sep 2022

The gas crisis is a long-term problem which will make the region poorer and less competitive while saddling it with higher public debt. Dealing with this as well as high inflation will cause further political ructions which will cascade down the years, says Hugo Dixon.

Norway gas lifeline for Europe is the smart move

9 Sep 2022

The staunch NATO ally supplies 25% of the European Union’s gas needs and nearly half Britain’s. A trebling of oil cash and record profit at energy giant Equinor give Norway scope to cut the EU some slack on gas prices. The discount size is less important than the gesture.

The consequences of Europe’s energy crisis

8 Sep 2022

As Russian President Vladimir Putin cuts off gas through a key pipeline, Breakingviews columnists discuss the response from UK and European governments, how the shutdown could have some longer-term benefits, and when Russia will feel the squeeze of lost revenue.

EU has ways to learn to live with less gas

6 Sep 2022

The closure of a key Russian pipeline leaves Europe facing a 20% shortfall in fuel supply. Measures to cut demand like lower temperatures in homes and incentives for companies to use less energy may soften the blow. More gas-dependent nations like Italy must now work harder.

Russia is giving German industry a slow puncture

27 Jul 2022

Industrial users of gas are in the firing line as Moscow halts supply. Companies like BASF face a hit from higher input costs and energy rationing, rather than a Uniper-style bailout. The problem for Berlin is that sustained high prices could make production head elsewhere.

Berlin spreads pain in 15 bln euro Uniper bailout

22 Jul 2022

That’s how much equity and debt the government may pump into the gas importer driven to near-bankruptcy by reduced Russian supplies. Diluted shareholders, Finnish owner Fortum, and German taxpayers will share the burden. So will consumers who will pay higher prices for gas.

Russian grain deal gives food crisis a partial fix

22 Jul 2022

Moscow has agreed to lift a blockade on 20 mln tonnes of Ukrainian grain. That should reduce the scale of a Middle East food crisis, and ease prices which remain high versus 2021. Still, Russia could always renege on the new deal.

Russia’s macro health hides chronic deficiencies

22 Jul 2022

Oil and gas exports and lower imports mean the rouble is strong, and GDP hasn’t yet collapsed. But longer term, Moscow needs to aid inflation-hit consumers, and help sanctions-hit firms fill the gap left by departing Western rivals. Graft and a brain drain will make that hard.

Ukraine needs hard cash more than debt relief

21 Jul 2022

The war-torn country needs $9 bln a month to cover its costs. Its central bank is running out of reserves. A bond payment freeze will help, but only at the margin. Western allies need to launch a coordinated aid effort to keep the country afloat.

Putin gas assault is a survivable test of EU unity

19 Jul 2022

Moscow’s key pipeline to Germany is offline for repairs, stoking fears Russia may cut off all its gas for good. That would mean soaring energy costs and a big economic contraction. But the worst outcome, where Germans hoard gas and splinter the European Union, looks less likely.

Finland’s Uniper hit best seen as defence spending

12 Jul 2022

Helsinki wants Berlin to rescue the ailing German energy group, but limit the hit to Finnish owner Fortum. Germany doesn’t agree. Finns would be better off seeing any dilution from a forthcoming capital hike as part of the cost of de-Russifying. Like the cost of joining NATO.

War helps Russian nickel king expand his realm

5 Jul 2022

Tycoon Vladimir Potanin may merge Norilsk Nickel with aluminium maker Rusal. The West would be extra wary of sanctioning such a giant for fear of roiling metals markets. The pair may have some synergies, but their two main owners don’t get on. It would be a governance nightmare.

Robinhood’s reversal, Russian oil cap

30 Jun 2022

The digital brokerage is worth less than a quarter of its $32 bln IPO value. In this Viewsroom podcast, Breakingviews columnists argue that its $7 bln cash pile and ample user base make it an attractive target. Also, Western leaders’ plan to restrict funds to Moscow may backfire.

Uniper woes could force reality check on Berlin

30 Jun 2022

The German utility needs state support after Russia cut gas supplies, forcing it to buy more expensive fuel instead. A better alternative would be for the regulator to allow Uniper to pass the cost on to consumers, dampening demand. The risk of open-ended bailouts helps its case.

Russia’s economy will soon be unrecognisable

16 Jun 2022

When the Ukraine war eventually subsides, Moscow will try to tempt companies and investors back. But its $1.5 trln GDP will have changed dramatically, with poorer consumers and more basic modes of production. Returnees will find a very different economic beast.