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Cutting off Russian oil completely was never the plan, it would have lead to an extremely damaging spike in oil prices that would have hurt everybody. Rather, t

by simonh 4y ago

Cutting off Russian oil completely was never the plan, it would have lead to an extremely damaging spike in oil prices that would have hurt everybody. Rather, the objective was to keep Russian oil flowing, while dramatically reducing the extent to which Russia profits from it. This has worked, the prices Russia is getting for their oil are single digit dollars above their production costs, which are going up due to sanctions, while global oil prices remained fairly stable. India and such buying cheap Russian oil is an intended outcome, not a problem. Good for them. It also helps that India is processing this oil into value-add exports that are pricing out Russian alternatives.

qbasic_forever 4y ago
[flagged]
- simonh 4y ago
  Here's an actual quote: “The price cap is specifically designed to reduce Russian revenues and Russia’s ability to fund its war of aggression whilst limiting the impact of Russia ́s war on global energy prices, particularly for low and middle-income countries,” - Joint statement by G7 finance ministers. A lot of breathless headlines got published early on by non-specialist journalists that have never had to cover anything like this, but nobody who actually understands the history and practice of sanctions in the modern era believed they would actually bring Russia to their knees any time soon. Read any of the coverage of these sanctions in The Economist from last year. North Korea has been under far more severe sanctions for generations and has even managed to develop nuclear weapons. Iran came under similarly severe sanctions and they're still a credible regional threat. The idea that Russia, a nuclear state with massive foreign reserves to draw on, even aside from the ones frozen in the west, would be beggared in a matter of months was always absurd. Sanctions have never in the modern era actually forced a state to capitulate. Wiping out on the order of 85% of Russia's oil profits while maintaining global prices is a major success. Yes Russian oil is still flowing, but the profits are now disproportionately going to countries outside Russia, like India. They're not suffering from the sanctions, they're making a killing Good for them. Even if you don't believe that this was the stated goal, though as you can see from the quote I opened with it was the actual stated goal, it's still obviously what's actually happened.

by simonh 4y ago

qbasic_forever 4y ago

[flagged]

simonh 4y ago
Here's an actual quote: “The price cap is specifically designed to reduce Russian revenues and Russia’s ability to fund its war of aggression whilst limiting the impact of Russia ́s war on global energy prices, particularly for low and middle-income countries,” - Joint statement by G7 finance ministers. A lot of breathless headlines got published early on by non-specialist journalists that have never had to cover anything like this, but nobody who actually understands the history and practice of sanctions in the modern era believed they would actually bring Russia to their knees any time soon. Read any of the coverage of these sanctions in The Economist from last year. North Korea has been under far more severe sanctions for generations and has even managed to develop nuclear weapons. Iran came under similarly severe sanctions and they're still a credible regional threat. The idea that Russia, a nuclear state with massive foreign reserves to draw on, even aside from the ones frozen in the west, would be beggared in a matter of months was always absurd. Sanctions have never in the modern era actually forced a state to capitulate. Wiping out on the order of 85% of Russia's oil profits while maintaining global prices is a major success. Yes Russian oil is still flowing, but the profits are now disproportionately going to countries outside Russia, like India. They're not suffering from the sanctions, they're making a killing Good for them. Even if you don't believe that this was the stated goal, though as you can see from the quote I opened with it was the actual stated goal, it's still obviously what's actually happened.