A Ukraine war deal that puts the energy squeeze on China – Asia Times

Donald Trump’s returning to the White House is causing a stir six months before his official announcement.

The President-elect’s receiving Russia-Ukraine minister, Keith Kellogg, his former intelligence chief, Richard Grenell and Vice President J D Vance are all proposing some variant of freezing the Line of Contact and blocking Ukraine from entering NATO, Reuters reported.

On the Russian area, Kyiv is suddenly signaling an attention in compromise. Volodymyr Zelensky, president, just made a hint to Sky News that he might take NATO membership and Russia’s ongoing possession of land that Ukraine recognizes as its own. This is a significant departure from his previous nihilist demand that Russia entirely leave Ukraine’s 1991 borders as a prerequisite for the resolution of the conflict.

The Wall Street Journal finally reported that his closest consultant, Andriy Yermak, met this week with members of Trump’s team, including Kellogg, Vance, and incoming National Security Advisor Mike Waltz. Trump’s coming chief of staff, Susie Wiles, even presumably met with Zelensky.

Ukraine plans to declare its preparation for peace, according to a statement from the Wall Street Journal. According to Bloomberg‘s statement, “Ukraine’s allies have switched their efforts from pursuing a victory to trying to position President Volodymyr Zelensky to best counteract Russian advances or discuss a possible ceasefire.”

Russia continues to make vehement demands that Ukraine reaffirm its democratic neutrality, demilitarize, denounce, and acknowledge the new regional realities brought about by the referendum on September 2022 that saw four of its original areas vote to join Russia.

Russia also requests that all of its freezing assets be returned to Russia with the lifting of all punishment. Russia will probably have to reach a compromise on some or all of these issues, but it’s not known how flexibly Vladimir Putin may be.

At this year’s” Russia Calling”! purchase forum, Putin said, “despite the&nbsp, political pressure, some of&nbsp, our partners, including those from Western Europe and&nbsp, the&nbsp, United States, have never left the&nbsp, Russian market…I&nbsp, am positive that relations with our European partners will eventually adjust, mainly because it is in&nbsp, their interest and&nbsp, ours, of&nbsp, course, as&nbsp, well”.

This suggests the potential contribution that business can make to uniting Russia and the US. In the event that Nord Stream II is sued in a European bankruptcy court in the first half of the following year, The Wall Street Journal reported late last month that Miami funder Stephen Lynch, who has a history of operating in Russia, wants to buy it.

He has officially sought the US government’s authorization to do so. If the job is approved, it goes to bid, and Lynch makes the necessary agreements, putting an end to the biggest war in Europe since World War II.

The key might be power politics. Trump’s earlier concerns to Nord Stream II were that it wasn’t under British control and may cause Russia to exert unfavorable effects on US objectives.

If Lynch purchases the network, however, then the matter had evidently been resolved. The next intact pipeline that Putin mentioned at a press conference after the BRICS Summit in October could then be used to help Germany avoid its rumored impending recession.

For that to happen, nevertheless, some American restrictions would have to be lifted. Trump might be able to continue using the SWIFT payment method and let deals to be conducted in US dollars for convenience, which would help him combat de-dollarization policies that he warned about in a late last month social media post.

The added benefit is that preventing a crisis may also help the entire EU avoid one, helping to keep it on par with US exports.

The US can continue to sell comparatively less expensive Gas to Europe and maintain the market share it has seized from Russia during the past nearly three years of hostility toward Ukraine, but some discounted oil from Russia may be required to maintain economic security in difficult economic times.

Additionally, the proposed raising of some sanctions against Russia, even if only primarily for its oil exports to Germany via what might be the US-controlled Nord Stream II, may open the door to further lifting them.

After all three parties engage in various concessions to that end, the energy industry may be involved, at least at second, and could be phased as a reward for ratifying any peace, truce, or peace agreement the US supports brokering between Russia and Ukraine.

Trump 2.0 is anticipated to be very hawkish toward China, so it follows that it might want to halt Russian energy exports from the People’s Republic over time, which could be accomplished through more imaginative diplomacy.

Russia’s oil exports to India could be included in the initial lifting of some sanctions, which would allow for the organization to move some of its gas exports to Germany. These exports could also once again be done in dollars and via SWIFT for convenience.

Excluding China from these exemptions might lead to lower prices on Russian oil, which would increase the total cost of its oil purchases from other countries. The US might even allow some of its companies to invest in Russia’s Arctic LNG 2 project, which it earlier sanctioned.

The goal would be to reduce the amount of energy that its systemic rival can import from Russia in the future by replacing Chinese investments with American ones. If the right conditions are created, Russia’s LNG gas exports might instead help fuel the Japanese economy.

In spite of the sanctions, Japan is determined to keep its LNG imports from the nearby Sakhalin 2 project uninterrupted, which could set the stage for the redirection of other such exports in the future.

The recent injection of foreign currency, particularly dollars, into Russia might ease the strains it is currently experiencing in terms of macroeconomics, encouraging the Kremlin to abide by any agreement that is ultimately reached with Ukraine.

Additionally, it’s possible to exchange some of its frozen assets for stakes in these same energy projects or other assets. Additionally, they could be used to purchase Western technologies, which are essential to the energy sector of the country.

The US might try to persuade Russia to reject the basement-bargain prices that China is reportedly demanding in exchange for signing a deal on the Power of Siberia II gas pipeline, depending on how effective such creative energy diplomacy is.

The Power of Siberia II project might be shelved if more lucrative markets emerge after the US stops obstructing some Russian exports, such as if it permits Russia to construct southern-directed pipelines to Iran and/or India via Iran or, Afghanistan and Pakistan.

It is in the US’s top strategic interests to encourage Russia not to give China cheap energy. The strategy could foreseeably be advanced through creative energy diplomacy, which might start with Lynch’s plan to buy Nord Stream II and move on until Russia stops building any additional pipelines to China. The only way to get the Kremlin on board, however, is through creative compromises on Ukraine.

Russia needs some of its maximumist demands to be met, aside from the relief of sanctions. This might involve the US compulsion to force Ukraine to accept the new territorial realities brought on by the conflict, restrain some of its armed forces, and rescind laws that Russia deems to be discriminatory against ethnic Russians and Russian speakers by withholding weapons as retribution if Zelensky refuses.

As Trump 2.0 makes its transition to Asia, the US would pay these small sums of money for allowing Ukraine to pay for the US to force Russia to end the war.