March 11, 2014 Naalij

Russia Warns Sanctions Could Backfire on US, EU

Much of Western Bailout Likely to Wind Up in Russian Hands Anyhow

As Western officials continue to ratchet up threats for sanctions on Russia, Foreign Minister Sergey Lavrov warned that the move could “boomerang” and hit the sanctioners, particularly in the European Union, much harder than Russia itself.

lavrovLavrov warned the US push for sanctions was “poorly thought out,” a comment that reflects EU concerns about the plan as well, since many EU nations are highly dependent on Russian natural gas.

The natural gas concern has fueled calls for the US to open up its exporting of gas, though the White House downplayed that prospect, and says that they are several years away from allowing significant exports of natural gas.

Ironically, Western officials that have been pledging billions of dollars to bail out the Ukraine economy in the wake of regime change are going to be finding a lot of that money going to Russia to pay bills owed to major Russian companies. Gazprom alone is owed nearly $2 billion for natural gas shipments to the Ukraine.

Proximity and historical ties make Russia by far the most important business partner for the Ukraine, though the recent protest movement has caused many Russian companies to dramatically reduce the estimated value of their business there.

by Jason Ditz

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