16.07.2017 Author: Grete Mautner

US Hydrocarbon Racketeering Turns into an Expensive Headache for Washington’s Allies

8546435445We’ve already touched upon the hydrocarbon racketeering strategies adopted by the Trump administration in a bid to put the US in the driving seat of the international politics once again.

In a bid to lower the rigid criticism of Washington’s aspirations to secure energy dominance, the US President Trump has recently announced during the talks between the leaders of the countries located between the Baltic, Black and Adriatic seas that the United States will never try use energy supplies to enforce certain policies upon other countries. He has also added that Washington seeks no monopoly in that area.

However, no one believes such sweet speeches anymore these days, especially when they’re coming for the White House. They say that describing haute cuisine dishes doesn’t make a bland dish you’re eating any tastier. We’ve witnessed America unleashing one military intervention after another, fully relying on the notion that might makes right.

It’s no wonder that the German Minister for Foreign Affairs, Sigmar Gabriel would state the other day that the United States perceives the world as an arena for struggle, where bilateral relations may be built in accordance with international law, but Washington thinks they mustn’t.

To maintain permanent domination in the world the US has always been seeking ways to remain the only country that would develop economically, technically and scientifically without any interference. To attend these goals a total of two world wars were organized, along with numerous revolutions and countless armed conflicts, in which America’s potential competitors would send each other back into the Stone Age.

Therefore, we shouldn’t be surprised that now Washington turns to hydrocarbon racketeering in yet another attempt to subject the world to its will. And the show is in the full swing now, forcing the vassal states of the United States (including certain European countries) to play the game that somebody else started.

The US is increasingly using its gas exports as a tool to gain leverage across the world. Washington has been desperately trying to prevent the expansion of Nord Stream pipeline across the of the Baltic sea from Russia to Germany. However, the sanctions that the White House introduces against Russia can backfire big time, as it’s been explained by Richard Sawaya, a vice president of National Foreign Trade Council.

In a bid to push Russia out of the market, Washington administration has repeatedly advised Europe to buy American shale gas, which could create new jobs and improve the sorry financial situation in America.

Thanks to the expansion of the Nord Stream, a number of opportunities for a large-scale Eurasian partnership opens, with China being one of its key participants. However, Washington strategists present all this as an anti-American conspiracy, because the Nord Stream 2 gas pipeline will strengthen the bond between Russia and the EU, and will give these two entities more power to exercise.

But Washington is still making attempts to force Germany into buying its liquefied gas, as it’s been noted in an interview with the Der Spiegel by Berlin’s state advisor on security and foreign policy, Kirsten Westphal.

In an effort to become a major exporter of liquefied gas, on par with such players as Qatar and Australia, the United States has been promoting the construction of new ports along with the introduction of new gas production capabilities, in accordance with the principle “drill baby, drill.” However, to achieve this goal the White House would be forced to take down all environmental restrictions.

Under the political pressure of the White House, Warsaw and Washington are discussing the possibility of concluding a long-term contract for the supply of American gas to Poland. However, in fact, this will only bring Warsaw additional expenses, because the break-even price of US after it is delivered to Poland reaches 266 dollars per thousand cubic meters while the price of Russian gas for the same amount rarely exceeds 213 dollars.

Following Poland’s example, due to the extensive amount of political pressure applied to it, Lithuania start importing LNG from the US, although the population of this country will be forced to pay way more for the across-the-ocean gas supplies than Poles. According to Energypriceindex, the average gas price for the Polish population reaches 466 euros per thousand cubic meters, while in Lithuania the same amount of gas is being sold for 610 euros. Pipeline gas for Lithuania is cheaper than LNG supplies by at least 100-150 euros per thousand cubic meters. Nevertheless, Lietuvos Dujų Tiekimas has already signed a deal on the supplies of liquefied gas from the US and pre-paid for them. According to various representatives of the company, first deliveries are expected in August, while the price remains a secret.

It is curious that this is not the first attempt to supply American LNG to Lithuania. In early 2015 yet another company Lietuvos Energija entered into a preliminary agreement on the supply of liquefied gas with the US. However, a year later the head of Lietuvos Energija Dalius Misyunas said that American gas does not meet their quality requirements.

A notorious Lativan politician and businessman Aivar Lembergs is convinced that Trump wants to force expensive shale gas deliveries upon Latvia in an interview with the Baltkom radio. He clarified that the main issue is the cost-effectiveness of American shale gas, while adding that if we take into account all the costs – transportation, storage, construction of the terminal, gas prices can raise by another 100 euros for one ton of gas delivered.

So how should analysts be treating the “sweet” assurances that Trump has been making that the United States will never try use energy supplies to enforce certain policies upon other countries?

Grete Mautner is an independent researcher and journalist from Germany, exclusively for the online magazine “New Eastern Outlook.”