Russia Business: Fool’s Gold

President Donald J. Trump’s efforts to reach peace between Russia and Ukraine have already guest Questions on the future of Russian energy exports, the country’s main milk cow, and if the door will open up joint projects between Russia and the EU or the United States, whatever the progress made in all negotiations, will be difficult, even impossible, to return to provisions before 2022. This is not necessarily in the strategic or economic interests of the EU or America.

More difficult times to come for the Russian economy?

Like the The Russian war against Ukraine is grindingTo the great frustration of President Trump, a rapid overview of the Russian economy outlook indicates potential problems to come.

Earlier this month, Senators Lindsay Graham (R-South Caroline) and Richard Blumenthal (D-Connecticut) led a bipartite group of 50 American senators in the introduction of a bill that could help increase pressure on Russian President Vladimir Putin to focus on war. The bill would impose steep Primary and secondary sanctions When selling Russian petroleum and energy products, if a cease-fire agreement is not concluded, or if Russia imposes an agreed agreement.

Following, Oil prices have plunged In the wake of President of President Trump “Day of Liberation” price ads While the markets are preparing for a recession. Although they recover now that Washington has opened a window for negotiations with everyone except China, Oil producers – especially Russia – are still nervous on long -term perspectives. Nowadays, a combined threat that tariffs and a potential recession can reduce prices per barrel cause long -term resistance of American companies to Washington calls for “drill, baby exercise”. This gives the hope of the economy of Russia, Although quite low hope. On the other hand, the fact that Moscow strongly pivoted in trade with Asia Staying the Russian economy afloat while Western sanctions have started to bite also mean that there is a particular vulnerability to the movements on the part of the United States which negatively affect China.

While Trump wants to improve relations with Putin, many in Washington are skeptical about it. Most recently, a difference in opinions and perspectives among the superior advisers of the Trump administration has become very public. The question is how Washington should manage Moscow in the interest of the damage of peace, or at least a lasting cease-fire, to end the war in Ukraine. History was first broken by the Wall Street JournalThen quickly taken up by a variety of media. A result seems to be that Europeans and the United States now speak together What Secretary of State Marco Rubio and others call “real secure and practical solutions to end the Russian-Ukraine War” when, initially, it seemed to try to end the current conflict could lead to a corner between the United States and its historical allies.

Meanwhile, the Russian economy is and was on a warpath. War leads to a shortage of available workers, concentrating growth (and subsidies) in the military industrial sectors, and contributing to inflation. Although the future is uncertain, the economy alone will not clearly force Putin’s hand to sign peace, at least not yet. However, it seems that allowing things to hang around for too long can lead to deterioration in the position of your country. This is probably why recent reports indicate that a The spring offensive by Moscow is underway – Putin’s strategy may be to get everything he can, then go for a peace agreement with enough territorial gains to call this a victory.

The future of Nord Stream 2

The Russian hydrocarbon giant Gazprom Gazprom of $ 11 billion Nord Stream 2 Pipeline Project to transit the Baltic Sea refuses to die. It was a magnet for controversy, but the anticipation of peace in Ukraine has triggered discussions Regarding a restart of its gas flow. In early March, reports emerged that Moscow had enlisted the long -standing ally of Vladimir Putin Matthias WarnigRosneft board of directors, to Press the Trump team To relaunch pipeline in the event of a post-sanction agreement through which the United States would regulate the tap. But Europe does not want a recovery, and the United States should not either.

Europe is wary of sleep in sleepwalking in the trap dependence on Russian energy resources which caused an energy crisis at the start of the 2022 invasion and mounting speculations that Europe could reopen its taps sparkled Posser European key votes.

The confrontation of Europe with Russia has created a massive opportunity for the United States, facilitating a overvoltage in American exports from LNG to Europe and raising geopolitics utility American energy. The reintroduction of Russian gas in Europe will only be done at the expense of the European market share of the United States – and at a time when President Trump has just said that the price of a zero mutual rate will be that the The EU buys $ 350 billion in energy “Made in the USA”

American Oilfield Services Company Oliver Hughes said that it “assesses the commercial environment for a return” when the sanctions are lifted, but the lowest suspension fruits in North Stream 2 harm American interests, and a large part of Europe actively seeks to reduce dependence on Russian gas.

Although American leadership can seek an advantage of the Russia’s energy industry as a first time as a result of a potential peace agreement in Ukraine, it is worth considering the will for an advantage that it can really grant. Between eating in the growing market share of America in Europe, stimulating Russia’s economic position, rushing to eliminate sanctions and cooperating with Russia could work at the expense of the United States.

What about the Arctic?

Historically, Arctic’s energy projects have posed significant economic and logistical challenges due to the hard geographic conditions of the region. While declining ice levels have attenuated some of these difficulties, the Operations of the Arctic of Russia have a new thorn on their side: sanctions.

Sanctions packages have had major implications for many long -term Gazprom Offshore exploration projects and two of Russia’s flagship projects in the region: Rosneft’s Vostok oil, which had its commissioning delayed Until 2026 due to a shortage induced by compatible oil tankers and Novatek Argtic LNG 2, which was set up socket From 2026 to 2028 after losing access to vital equipment.

February discussions between Russia and the United States in Riyadh subject to to potential cooperation between the two in the Arctic, but the offshore exploration in the region is still prohibitive, Wood Mackenzie global energy research cabin.

Kiril Dmitriev, director general of the Sovereign Heritage Fund for Russia, considers the Arctic as an element of potential rapprochement between the United States and Russia, argue that the increasingly important geopolitical region is “too important for the policy of style of the Cold War”. But American investors must ask themselves whether the Kremlin only suspends these projects as an incentive to ensure that the United States discloses the sanctions that hinder Russia’s ambitions.

Russian nuclear sector

The potential renaissance of business ties between the United States and Russia was also extended in the nuclear sphere, Dmitryv addressed directly to Elon Musk, a key figure in the second Trump administration, float the idea of a small nuclear power plant for the exploration of March.

Nuclear energy has become a priority under the Trump administration, and this recent development, with Trump interest In the Zaporizhzhia nuclear power plant in Ukraine, has widened energy cooperation speculation.

Russia is one of the most advanced in the world producers nuclear technology and energy, and takes advantage of this basic competence to extend its own export capacity for nuclear power plants. Rosatom belonging to the Russian State is under contract to build 40 international installations, in addition to its in progress Kursk II,, LENINGRAD IIAnd Brest-Od-300 Nuclear fuel installation projects.

The United States is impatient to unleash its own nuclear energy capacities and currently imported Almost all enriched uranium He uses and work is underway to develop national manufacturing capacities. Although imports of Russian uranium products were specifically prohibited in August 2024, companies can request derogations until January 2028. In this area, cooperation offers more mutual advantages than some of the other potential hydrocarbon energy projects.

American potential – Russia relaxation No guarantee of business return as usual

Whatever the political advantages of rapprochement, it remains uncertain if Western companies will be impatient to return to Russia, because companies weigh Highly modified commercial environment of the authoritarian system of the late Putin.

A bit like the accompanying difficulties development of strategic minerals In Russia, joint energy cooperation between the United States and Russia requires high initial costs with long-standing production, exacerbated by the risks of convulsions And corruption. Today, any business council concerned with compliance would serve a Russian project at Haut Capex.

Some may dream of an American-Russian rapprochement transforming them by following Armand HammerThe legendary CEO of Western Petroleum who has done business in Lenin in Brejnev, but most of the business leaders consider the commercial prospects of Russia as well as the gold of the madman.