Let’s make this hashtag trend: #FreezeForUkraine
This is not a joke, unfortunately. If Germany refuses to pay for gas in Russian rubles, the Russians will turn off the spigot and Europe’s largest economy will come to a screeching halt.
Germany has declared an “early warning” over possible gas supply disruption amid a payments stand-off with Russia.
Russia had demanded “unfriendly” countries pay for its gas in roubles from 31 March, but the EU, which mainly pays in euros, has rejected the idea.
Moscow later appeared to soften its stance, saying on Wednesday rouble payments would be introduced gradually.
But Germany has urged consumers and companies to reduce consumption in anticipation of possible shortages.
Germany gets about half its gas and a third of its oil from Russia and has warned that it could face a recession if supplies suddenly stopped.
Under an existing gas emergency plan, the “early warning phase” is the first of three steps designed to prepare the country for a potential supply shock.
In its final stage, the government would bring in gas rationing.
The question to be asked is who is sanctioning who? By any metrics, it definitely looks like the Russians are playing check, while the West is playing checkers. After basically canceling Russia on the world stage and confiscating Russia’s sovereign funds, the West is now complaining that Putin is not playing fair.
We have to admit: Putin does not bluff.
No plan will work in the longer term unless there is an exchange of value for value. The ultimate payment for clearing balances between nations should be gold.