The Ukraine conflict will have “enormous economic repercussions in Ukraine and beyond.” This was warned by U.S. Treasury Secretary Janet Yellen in a House panel Wednesday. She added that the rising price of energy, metal, wheat and corn that Russia and Ukraine produce “is going to escalate inflationary pressures as well.”
An AP report — Yellen: Russia’s invasion will have ‘enormous repercussions’ — said:
Her remarks in the House Financial Services Committee were part of her annual testimony on the state of the international financial system.
Along with touching on the need for food and energy security and debt sustainability globally, Yellen called on Congress to provide support to the International Monetary Fund and World Bank organizations, which have provided grants and humanitarian funds financing to the world’s poorest and most vulnerable.
“Globally,” she said, “spillovers from the crisis are heightening economic vulnerabilities in many countries that are already facing higher debt burdens and limited policy options as they recover from COVID-19.”
“The sanctions we have placed on Russia are pushing up the price of energy. It is a price that is important to pay to punish Russia for what it is doing in Ukraine,” she added, drawing on how the conflict is impacting Americans at home.
Inflation has reached 40-year highs as an inflation metric closely monitored by the Federal Reserve jumped 6.4% in February compared with a year ago, the largest year-over-year rise since January 1982.
The US and its allies have imposed an avalanche of sanctions against Russia.
On Wednesday morning, the U.S. announced more sanctions, this time targeting Russian President Vladimir Putin’s two adult daughters and toughening penalties against Russian banks in retaliation for “war crimes” in Ukraine.
Lawmakers also questioned Yellen on China and the threat of an invasion of Taiwan as the U.S. and its allies continue to impose sanctions on Russia. She said the U.S. is prepared to impose sanctions against China if Beijing moves aggressively toward Taiwan, as some fear it might.
“I believe we have shown that we can in the case of Russia,” she said. “I think you should not doubt our ability to resolve to do the same in other situations.”
She was also asked about Russia’s involvement in the G-20 summit, which is set to take place in Indonesia later this year.
The Indonesian government has said it would hold the G-20 Summit impartially, resisting calls to exclude Russia.
“I’ve made clear to my colleagues in Indonesia that we will not be participating in a number of meetings” at the annual summit where Russia would be involved, Yellen said.
White House press secretary Jen Psaki clarified later in the day that Yellen was referring to ministerial-level meetings and that the U.S. would not boycott the summit in its entirety.
“It should not be business as usual,” she said.
President Joe Biden has said he would like to kick Russia out of the G-20.
EU Spends 35 Times More On Russian Energy Than Weapons For Ukraine
The EU spent 35 times more on Russian energy imports than weapons for Ukraine, the bloc’s foreign affairs chief has admitted.
A Telegraph report said:
‘The EU paid Moscow €35 billion, Josep Borrell told the European Parliament, compared to just €1 billion in aid for arms to Kyiv.
While he said the money for arms for Ukraine “might seem a lot”, he added: “€1 billion is what we pay Putin every day for the energy he provides us.”’
The Telegraph report said:
‘The UK imposed an asset freeze on Sberbank, Russia’s largest bank, banned UK investment in the country – which was worth more than £11 billion in 2020 – and will legislate to prohibit imports of iron and steel.’
Hungary’s Opposition To Sanctions and Weapons
The Telegraph report added:
‘At a press conference to celebrate his landslide re-election victory, Viktor Orban, Hungary’s prime minister, has vowed to block any EU sanctions on Russian oil and gas.
‘Orban, who will not allow Western weapons for Ukraine to pass through his country, won a fourth consecutive term on Sunday after campaigning on a platform of keeping Hungary out of the war.
‘“We will certainly not be supplying arms to Ukraine,” he said. “That also applies to the extension of sanctions against Russia to gas and oil.”
‘He insisted he was on the same side as the EU and Nato and opposed the invasion of Ukraine.
‘Hungary, which is heavily reliant on Russian gas and oil imports, signed a new 15-year gas supply deal last year. Gazprom is expected to ship 4.5 billion cubic meters of gas annually to the country.
‘“Hungary can only get energy from pipelines – if sanctions are imposed, there will be none,” Orban said, as he vowed to resist pressure from his EU allies for tougher action.’
Hungary Will Pay In Roubles
The report said:
‘Breaking ranks with other EU leaders, Orban said it would be “no problem” for Hungary to agree to a Russian demand that Kremlin-controlled gas be paid for in roubles.
‘He ruled out Hungary joining coordinated European expulsions of Russian diplomats after countries including Italy, France and Germany told suspected spies to leave.
“We do not plan any expulsions and do not support them,” said Orban, whose Right-wing Fidesz party secured a two-thirds majority in the parliament.
‘The nationalist leader, who has backed previous EU sanctions against Russia, said he had invited Putin to Budapest for ceasefire talks with the president of Ukraine.
‘He said Volodymyr Zelensky, who has criticized the Hungarian prime minister for being soft on Russia, had “a bad habit of telling everyone what to do”.
‘“It’s unusual for someone in trouble to ask for help and tell you to help him, and if you don’t help him, he’ll tell you off,” Orban said after Ukraine’s ambassador was summoned for a dressing down in Budapest.
‘Orban admitted his stance had alienated long-term ally Poland, which backs sanctions on oil and gas.
‘Some leaders did not congratulate him on his victory and he faces legal action from Brussels that could freeze EU funding over rule of law concerns.’
U.S. Miners And Russian Coal
A Bloomberg report — Don’t Expect U.S. Miners to Replace Russian Coal in Europe — said:
U.S. coal miners including Peabody Energy Corp. are surging as the EU proposes banning imports of the fuel from Russia. But it will be difficult, if not impossible, for them to fill the potential supply gap.
Miners have had little incentive to invest in new capacity. In the U.S., the number of producing coal mines slumped more than 60% from 2008 through 2020. The nation’s remaining miners have already sold most of their output under long-term contracts and have few spare tons to deliver.
Those issues have been exacerbated by tight labor markets, while supply-chain bottlenecks would make it difficult to deliver additional tons to export terminals, said Ernie Thrasher, chief executive officer of Xcoal Energy & Resources LLC., the biggest U.S. exporter.
“I don’t see any ability for the industry to expand production,” he said. “It is like looking at a sweet dessert that you just cannot reach.”
Russia supplied about 18% of global coal exports in 2020, with Europe as the largest buyer. Prices in the U.S. have been soaring, surpassing $100 a ton last week for the first time in 13 years.
Peabody, the biggest U.S. coal producer, jumped as much as 14% Tuesday, the most intraday in two weeks. Arch, the second-biggest miner, climbed as much as 7.5%, while Consol Energy Inc. gained as much as 12% as prices spiked in Europe.
EU Proposes Russian Coal Ban
An earlier AP report said:
The EU’s executive branch proposed Tuesday a ban on coal imports from Russia in what would be the first sanctions targeting the country’s lucrative energy industry over its war in Ukraine.
European Commission (EC) President Ursula von der Leyen said the ban on coal imports is worth 4 billion euros ($4.4 billion) per year and that the EU has already started working on additional sanctions, including on oil imports.
She did not mention natural gas, with consensus among the 27 EU member countries on targeting the fuel used to generate electricity and heat homes more difficult to secure.
If the proposal is adopted unanimously by all 27 EU countries, the new package of sanctions would also ban Russian vessels and Russian-operated vessels from EU ports, with exceptions for essentials such as agricultural and food products, humanitarian aid and energy.
Further targeted export bans, worth 10 billion euros, in sectors covering quantum computers, advanced semiconductors, sensitive machinery and transportation equipment have also been proposed.
“With this, we will continue to degrade Russia’s technological base and industrial capacity,” von der Leyen said.
According to EU trade commissioner Valdis Dombrovskis, 62% of Russia’s exports to the EU were hydrocarbons last year.
Because of its climate ambitions, the EU has been moving away from coal for years. Coal use fell from 1.2 billion tons a year to 427 million tons between 1990 and 2020, but imports rose from 30% to 60% of coal use.
The EU imported 53% of hard coal from the country in 2020, which accounted for 30% of the EU’s hard coal consumption.
Russian coal would be easier to replace than Russian gas because coal comes by ship and there are multiple global suppliers. Germany’s association of coal importers said in March that Russian coal could be replaced “in a few months.”
Analysts at the Bruegel think tank said in March that Germany and Poland were particularly reliant on Russian coal for power generation and that “Russian coal can be replaced because global markets are well supplied and flexible.”
But they added that “replacing Russian coal imports will require the lightspeed deployment of new supply chains to bring the right type of coal where it is needed. Most European coal users already source from different suppliers and should be able to build on existing relationships.”
But the switch would mean more import demand from Europe and higher global coal prices, with significant effects on emerging and developed economies that also rely on coal.
EU Fails To Agree New Russia Sanctions
A later report said:
EU policy makers failed to agree Wednesday on a new package of sanctions against Moscow, including a ban on Russian coal imports, Reuters reports, citing its sources. The latest round of economic restrictions was proposed by the European Commission earlier this week.
Persons familiar with the matter explained the fiasco citing “technical issues” that needed to be resolved, including on whether a coal import ban would affect existing contracts.
The sources noted that it was not clear yet how the issues will be resolved, but the EU hopes to reach a compromise at a meeting on Thursday.
In March, European countries imported a total of 7.1 million tons of thermal coal, which is used in power and heat generation. That is a 40.5% increase year-on-year and the highest level of imports since March 2019.
EU Countries Hunt For Coal
From London, Reuters reported:
European buyers are increasing shipments of coal from across the globe against a backdrop of a proposed EU ban on Russian imports and the scramble to relieve tight gas supplies, according to data and shipping sources.
“Despite Russian coal shipments to Europe in March still continuing at pre-war levels, the expected alteration in coal flows into Europe has started to show,” Braemar dry bulk analyst Mark Nugent said.
“Shipments from Colombia and the United States have been strong in response to the conflict with Atlantic suppliers providing the most cost-efficient alternative for European end-users.”
On a weekly basis, March 28-April 1 saw the highest levels of Russian thermal coal imports since the Feb. 24 invasion began, with 887,000 tonnes of Russian thermal coal imported into the EU, according to Braemar.
German coal importers’ group VDKi on Wednesday said the country should be able to find alternatives to Russian hard coal imports by the peak demand winter season, but there will be technical issues and increased costs.
“Alternatives to Russian coal do exist but will be costly,” consultancy Eurasia Group said in a note on Wednesday.
Thermal coal imports from Colombia totaled 1.3 million tonnes in March, rising by 47.3% year-on-year, Braemar data showed.
Imports from the U.S. in March totaled 809,000 tonnes, rising by 30.3% year-on-year and at their highest level since October 2019.
Imports from South Africa also picked up with 287,000 tonnes arriving in March versus no shipments in March last year.
Australia has also found renewed buying interest from Europe, with thermal coal imports totaling 537,000 tonnes in the first quarter of this year, versus no shipments over the same period in 2021, Braemar said.
But Indonesia and Australia, among the world’s top coal exporters, have hit their production limits and are unlikely to meet Europe’s demand for additional supplies if the EU bans Russian coal imports, mining executives said.
“There is greater concern over the risks with trading Russian coal (due to broader sanctions), so that is already having an impact on shipments,” one shipping source familiar with the trade said.
Greece will ramp up coal mining in the next two years as a “temporary” measure to help reduce a dependence on gas, Greek Prime Minister Kyriakos Mitsotakis said on Wednesday.
Although it is still more expensive to burn gas to produce power than coal, the price of thermal – which is for heating and power generation – has reached all-time highs this year.
Alex Stuart-Grumbar, dry bulk analyst with shipping consultancy MSI, said Europe’s need to import more coal from sources further afield would be positive for the larger panamax and capesize shipping segments on long-haul coal trade routes.
“The initial disruption to trade patterns will be positive for dry bulk markets, though ultimately, this will push global coal prices higher, incentivizing China and India to produce more coal domestically,” Stuart-Grumbar said.
U.S. Coal Prices Top $100 a Ton for First Time Since 2008
Another Bloomberg report said:
U.S. coal prices topped $100 a ton for the first time in 13 years.
Prices for coal from Central Appalachia surged 9% to $106.15 a ton last week, the highest since late 2008, according to government data released Monday. Prices in the Illinois Basin rose to $109.55, topping $100 for the first time in records dating to 2005.
The surge matches increases around the world as the Ukraine war prompts users to seek alternatives to Russian coal, which accounted for almost 18% of global exports in 2020. That’s exacerbating a surge in demand that began last year as a global economic recovery from pandemic drove up electricity consumption.
While U.S. power producers have been shifting away from coal, consumption actually climbed last year as prices also increased for natural gas. More costly fossil fuels come as U.S. consumers already face the highest inflation in four decades. Americans are paying higher utility bills, food prices are surging and housing costs are up.
Prices in Central Appalachia and the Illinois basin are rising more than in other U.S. coal-producing regions because they have easier access to international markets. U.S. exports climbed 23% last year and are expected to increase another 3.3% this year as miners take advantage of record international prices.
The rebound in coal comes as a UN-backed panel of climate scientists warned Monday that the world may be on track to warm at a pace that would painfully remake societies and life on the planet.
European Security: Not All In Agreement
A New York Times report — NATO Nations See Differing Paths As Ukraine War Enters Uncertain Stage — said:
‘Faced with the prospect that the war in Ukraine will be long and grinding, NATO countries are divided on how best to manage the next stage of the conflict and the uncertain period that promises to follow.
‘Central European members like Poland and the Baltic states want a total break with Moscow and an effort to bring Russia to its knees, two senior Western officials said. They worry that anything that Russia can present as a victory will do serious damage to European security.
‘But other nations believe that Russia cannot be easily subdued and that the war’s outcome is likely to be messy — more exhausting cease-fire than resounding victory. Countries like France, Germany and Turkey want to keep contacts with Russia’s president, Vladimir V. Putin, regardless of the allegations of war crimes committed by his troops, the officials said.’
The New York Times report said:
‘NATO foreign ministers, meeting this week to discuss how to help Ukraine prosecute the war, do agree on one major point: The war is far from over and — as badly as Russia’s forces have performed and despite their retreat from areas around Kyiv, the capital — they are making slow and brutal progress in Ukraine’s east.
‘“Moscow is not giving up its ambitions in Ukraine,” Jens Stoltenberg, NATO’s secretary general, said this week. “We now see a significant movement of troops away from Kyiv, to regroup, rearm and resupply. And they shift their focus to the east.”
‘That will take several weeks, officials believe, as Russian troops move back into Belarus to be resupplied and reorganized, and then must make their way with their equipment through Russia toward eastern Ukraine.
‘“In the coming weeks, we expect a further Russian push in the eastern and southern Ukraine to try to take the entire Donbas and to create a land bridge to occupied Crimea,” Mr. Stoltenberg said. “This is a crucial phase of the war.”’
The report said:
‘There is a general agreement that Russia is no longer a strategic partner of the alliance, that the North Atlantic Treaty Organization is no longer bound by the troop limits of the 1997 NATO-Russia Founding Act, and that its military posture must be sharply enhanced to deter a confrontational Russia, so long as Mr. Putin and his allies retain power there.
‘There is also a commitment to continue aiding Ukraine — some two-thirds of NATO members have already provided lethal weaponry, including the Czechs’ contribution of Soviet-era tanks and armored personnel carriers.
‘But some stocks are running low in the West — U.S.-made Javelin antitank missiles, for example. And Ukraine is also going to need different weapons for the next phase of the war in the east, officials suggest, including longer-range artillery and more sophisticated armed drones, if they hope to push the Russians back, let alone drive them out of Ukraine.
‘The amount of matériel arriving in Ukraine remains a secret, but officials say that the overall flow is very large and has made an enormous difference to the war. But what sort of weapons are most useful, and how to think through the possible conclusion to the war, is preoccupying alliance leaders.
‘“On a number of fronts, we obviously have some changing battlefield dynamics,” U.S. Secretary of State Antony J. Blinken, who is in Brussels for the NATO meetings, told reporters this week.
Mr. Blinken said the NATO meetings would focus on new ways to support Ukraine and to “put pressure on Russia,” and on Mr. Putin. More evidence of atrocities is likely to emerge, he said on Wednesday, as Russia pulls out of territories it controlled, “like a receding tide.”
‘On Tuesday, Mr. Blinken announced a further $100 million worth of weapons and equipment from American stockpiles. Total U.S. military aid to Ukraine is worth some $2.4 billion since President Biden took office and more than $1.7 billion since the war began on Feb. 24, he said.’
The New York Times report said:
‘How the war might finally end is an important issue not just for Ukraine but for the entire alliance.
‘U.S. officials are skeptical that Russia is prepared to make real concessions in ongoing peace talks with Ukraine, although they do not rule out the possibility and want to ensure Kyiv’s leverage in the negotiations.
‘That is a key discussion. While Ukraine will decide for itself how and when to try to end the war and what it will negotiate with Moscow, President Volodymyr Zelensky and his government are in regular discussion with NATO country leaders, including the Americans.’
‘Some countries, especially in Central Europe and including Britain, are anxious that any sort of Russian expansion into Ukrainian territory, let alone a Russian victory, would embolden Mr. Putin, undermining overall European security and values such as the adherence to international law, respect for national sovereignty and territorial integrity. They want Russia to be seen as the loser.
‘Even if the war ends with a new line of contact between Russian and Ukrainian forces, NATO aims to work with Kyiv to make Ukraine indigestible to Russia, as another senior Western official said. The point is to arm and train the Ukrainians so well that Mr. Putin would not wish to try again.
‘The foreign ministers will also begin a deeper discussion of NATO’s new strategic concept, the first since 2010, now in early draft. It is much tougher on Russia, and foresees a longer period of confrontation and expensive deterrence.’
Screengrab of Russian Defence Ministry briefing showing US-sponsored biolabs on Ukraininan territory. Photo : Russian Ministry of Defence
A Xinhua report — New evidence shows US-funded biolabs used to attack Donbass, Russia: RT — said:
Russia’s Defense Ministry has found evidence suggesting Kiev was planning to use pathogens developed in Pentagon-funded biological laboratories against the population of Donbass and Russia, according to an article published on RT.
Alongside Kiev’s intent, the defense ministry allegedly identified concrete U.S. officials involved in developing biological weapons in Ukraine.
These officials were “the heads of divisions and employees of the U.S. Department of Defense, as well as its main contractors,” said the report, citing Russian Defense Ministry spokesman Igor Konashenkov.
Hunter Biden, the son of the current U.S. president Joe Biden, was directly involved in these campaigns, Konashenkov said, citing investigations by Western media, adding Hunter Biden has worked closely with Pentagon contractor Metabiota, which specializes in research on pathogens that can be used to develop biological weapons.
In a contrasting move to its pressuring of European allies to not buy Russian oil against the backdrop of the ongoing Ukraine crisis, the U.S. increased crude oil supplies from Russia by 43 percent, or 100,000 barrels per day, over the past week, Russian Security Council Deputy Secretary Mikhail Popov told Russian media on Sunday, with critics pointing out that the U.S. pursues its own interests at the costs of its European allies.
According to the Russian official, Europe should expect similar “surprises” from the U.S.
“Moreover, Washington allowed its companies to export mineral fertilizers from Russia, recognizing them as essential goods,” Popov added.
Meanwhile, U.S. Treasury has set deadline to end deals on oil and coal imports from Russia until April 22.
U.S. liquefied natural gas exports rose nearly 16 percent last month to a record high, according to preliminary Refinitiv data, with shipments to Europe continuing to dominate.
U.S. LNG is in high demand as European countries try to cut gas imports from Russia after its military operation in Ukraine, while also looking to rebuild diminishing inventories.
Local media reported that Europe has been the top importer of U.S. LNG for four consecutive months, taking about 65 percent of U.S. exports.
In a joint agreement, the U.S. announced on March 25 to provide at least 15 billion cubic meters more of liquefied natural gas to Europe this year, seeking to end the bloc’s dependence on Russian energy exports. These additional volumes of LNG are expected to increase going forward, the White House said in a statement.
Mick Wallace, a member of the European Parliament, tweeted a video of his parliamentary speech, saying that Europe should indeed wean itself off its dependence on Russian energy, but must not replace it with “filthy fracked Gas” of the U.S., which has invaded other countries more than any other country in the world, according to media reports.
Analysts said the biggest beneficiary from Russia-Ukraine crisis and ban on Russian oil is the U.S. while some netizens mocked the U.S. move as ensnaring its European allies.
By buying oil from Russia and reselling it to Europe, the U.S. can make a profit, said some Twitter users.
Kremlin Says Peace Talks With Ukraine Not Progressing Rapidly Enough
A Reuters report said:
The Kremlin said on Wednesday that peace talks between Moscow and Kyiv were not progressing as rapidly or energetically as it would like.
Russia has accused the West trying to derail peace talks with Ukraine by fuelling “hysteria” over allegations of war crimes by Moscow’s forces following their retreat from the Kiev region.
Kiev and the West say there is evidence, including images and witness testimony gathered by Reuters and other media organizations, that Russia committed war crimes in the Ukrainian town of Bucha. Moscow denies the charge and has called the allegations a “monstrous forgery.”
“The only thing I can say is that work (on the talks) is continuing,” Kremlin spokesman Dmitry Peskov told reporters on a conference call when asked about the prospect of another round of negotiations between Moscow and Kiev.
“There is a still a long road ahead. The work process is ongoing but it is dragging along way more than we would like.”
Russian Foreign Minister Sergei Lavrov said on Tuesday that Moscow believed the war crime accusations were timed to derail the negotiating process.
Twitter bans U.S. Marine For Questioning Ukraine Narrative
Twitter “permanently suspended” the retired U.S. Marine Corps officer Scott Ritter on Wednesday, accusing him of engaging in prohibited behavior by questioning the claims of Ukrainian authorities that Russian soldiers had massacred civilians in Bucha near Kiev. Ritter is best known as the former UN weapons inspector who doubted U.S. claims about Iraqi weapons of mass destruction, invoked by Washington as a pretext for the 2003 invasion.
“So apparently I’ve been suspended from Twitter for the crime of challenging the orthodox narrative of the so-called Bucha massacre,” Ritter said on his Telegram channel, sharing a screenshot of the message he received from the Big Tech platform. “I’ve appealed, so who knows what the future will bring,” Ritter said, adding that “Freedom of speech in America today is an endangered concept.”
According to the screenshot, Twitter’s censors had decided that Ritter violated their rules against “harassment and abuse” by saying the Ukrainian police had committed crimes against humanity in Bucha, and were trying to shift blame onto Russia with U.S. help.
Ritter’s tweet did not contain calls for abuse or harassment, or wish physical harm on anyone, Shadowproof journalist Kevin Gosztola pointed out, arguing that his ban “shows how Twitter Rules can be twisted to silence US foreign policy critics.”
The rules were recently updated to include “denying mass casualty events took place,” Gosztola noted, but he said Ritter had not done that, either.
In an op-ed published by RT on Monday, Ritter had examined the Ukrainian allegations that the withdrawing Russian troops had massacred civilians on their way out of Bucha, pointing out a number of inconsistencies and “red flags” with them and putting them in the context of the propaganda war raging parallel to the ongoing military conflict.
Grayzone’s Aaron Mate also pointed out that there was nothing that fit the definition of “targeted harassment” in Ritter’s flagged tweet, and asked Twitter to “please undo” the ban.
“You’re suspending a decorated Marine Corps veteran and former chief UN weapons inspector who bravely warned the world about the Bush [administration’s] Iraq WMD lies. Silencing voices of dissent will make your platform un-usable,” Mate tweeted.
Ritter is a retired U.S. Marine who had inspected Soviet weapons under the now-defunct INF treaty, worked as the chief UN weapons inspector in Iraq from 1991 to 1998, and served on the staff of General Norman Schwarzkopf during the first Gulf War.
His “suspension” comes just days after Tesla and SpaceX founder Elon Musk took a seat on Twitter’s board of directors, having become the platform’s largest single individual shareholder on hints that he would dial back its censorship.
U.S. Spies Reveal Leaking Dodgy Intelligence On Russia
U.S. intelligence officials leaked information about the Ukraine conflict that was not “rock solid” and outright made up some claims, all to win an “info war” against the Kremlin, according to an NBC News report on Wednesday. The officials admitted to, and boasted about, releasing this misinformation.
When the American media cited US “intelligence” to warn that Russia was preparing to use chemical weapons in Ukraine, and when President Joe Biden repeated these warnings, they were participating in a disinformation campaign, the NBC report reveals.
According to the intelligence officials who came up with the warning, the intention was to discourage Russia from actually using these weapons, even though they themselves rated the intelligence used “low confidence.”
NBC quotes the officials involved in releasing such “low confidence” intelligence, who described their mission to misinform as part of an effort to “undermine Moscow’s propaganda and prevent Russia from defining how the war is perceived in the world.”
Some releases were accurate. For instance, the Biden administration insisted for weeks that Russian President Vladimir Putin intended to launch an assault on Ukraine.
More were fabricated: A report that Putin was “being misled by his own advisers,” as NBC put it, was made up. So was an assertion by U.S. officials that Putin had turned to China for military aid. Despite being fabricated, the latter was released to discourage China from actually doing what the officials said it was doing – sending arms to Russia, they said.
One European official cited by NBC said that the report was “a public game to prevent any military support from China.”
“There’s no way you can prove or disprove that stuff,” a retired intelligence operative told NBC regarding the claims that Putin was being misled by his own team.
Prior to the outbreak of war, U.S. media warned for weeks that Russia was laying the groundwork to attack Russian-speakers in the Donbass region and blame the attack on Ukrainian nationalists, thus generating a pretext for war.
These reports cited Pentagon and State Department officials and unnamed “intelligence sources,” none of whom provided evidence to back up their claims. When pressed, State Department spokesman Ned Price said that those who doubted the claims were finding “solace in the information the Russians are putting out.” Now the NBC story reveals that the assertion was indeed cooked up by U.S. spies.
“It doesn’t have to be solid intelligence,” one US official said. “It’s more important to get out ahead of [the Russians], Putin specifically, before they do something.”
While the officials cited in the report admitted to at the very least exaggerating their claims, another unnamed U.S. official quickly responded to the network, insisting that the National Security Council and “intelligence community” made sure to “validate the quality” of everything they released to the public.
One of the authors of the NBC story is Ken Dilanian, a national security reporter shown in 2014 to have had a “collaborative” relationship with the CIA. He was disavowed by his then-employer, the Los Angeles Times, as the result.
EU Country Seizes Russian Art Citing Sanctions
Finland announced on Wednesday that its customs service has seized Russian artwork coming back from being loaned to exhibits in the EU and Japan, citing EU sanctions against Moscow over the conflict in Ukraine. The paintings and sculptures in question belong to Moscow’s Tretyakov Gallery and St. Petersburg’s Hermitage Museum, among others, and their value has been estimated at $46 million or more.
The seizure took place over the weekend at Vaalimaa, the busiest crossing on the Finland-Russia border, but the Finnish Customs confirmed it at a press conference on Wednesday.
The agency justified the seizure by saying that “a paragraph” of EU sanctions against Russia – imposed over the course of the past six weeks due to the escalation of hostilities in Ukraine – referred to artwork.
The unspecified number of paintings and sculptures was being stored “with overall consideration for their value, characteristics and safety,” pending a full investigation, Finnish Customs said. The Finnish foreign ministry will consult the European Commission about the fate of the art pieces.
According to Russian media, the trucks contained over 200 paintings from the Hermitage and Tretyakov which had been on loan to the “Grand Tour: Dreams of Italy from Venice to Pompeii” exhibit in Milan, Italy. Another shipment was on exhibit in Japan and was also coming home via Finland.
Russian conductors, performers, artists and even cats and trees have found themselves subject to “cancellation” by the U.S. and its allies, after Moscow sent troops into Ukraine in February.
In the most recent incident, Britain’s National Gallery has changed the title of a 1890 painting by French impressionist Edgar Degas, from ‘Russian Dancers’ to ‘Ukrainian Dancers,’ after a campaign by Ukrainian activists.
U.S. Warns India Over Russian Weapons
U.S. Secretary of Defense Lloyd Austin said on Tuesday that India’s continued purchase of Russian weapons systems is “not in their best interest,” and that there will be a “requirement” that leaders in New Delhi swap some of these systems for U.S. and allied armaments. India is the world’s largest military importer, and counts on Russia for nearly half of its external supply of weaponry.
Austin was responding to a question from Representative Joe Wilson (R-South Carolina), who described India as a “treasured ally” of the U.S. and “the world’s largest democracy.” What, Wilson asked Austin, could the U.S. do to convince “Indian leaders to reject Putin and align with its natural allies of democracy?”
Austin responded that the U.S. has “the finest weapons systems in the world,” and would offer them to New Delhi.
“We continue to work with [India] to ensure that they understand that it’s not in their … best interest to continue to invest in Russian equipment,” Austin told the members of the House Armed Services Committee. “And our requirement going forward is that they downscale the types of equipment that they’re investing in and look to invest more in the types of things that will make us continue to be compatible,” he added.
Austin is not the first U.S. official to talk of boosting arms sales to India. Former President Donald Trump inked a $3 billion arms deal with Indian Prime Minister Narendra Modi in 2020, selling India Apache helicopters and Hellfire missiles, in an apparent bid to counter China in South Asia.
Despite this boost in sales, the U.S. remains India’s third-largest arms supplier, providing just 12% of New Delhi’s lethal imports between 2017 and 2021. France provides 27% of India’s imported weapons, while Russia provides a whopping 46%, with all figures supplied by the Stockholm International Peace Research Institute.
According to some analysts, 85% of major Indian weapons systems to this day are of Russian or Soviet origin.
These include the Indian Air Force’s Su-30, MiG-21 and MiG-29 fighter aircraft, the Indian Army’s T90MS main battle tank, and the Indian Navy’s sole aircraft carrier, the Russian-built INS Vikramaditya. Furthermore, despite intense pressure from Washington, including veiled threats of sanctions, New Delhi has pressed ahead with acquiring the Russian S-400 air defense system.
It is unclear which weapons systems Austin wants India to “downscale” its investment in, but allied purchases of the S-400 in particular have irked Washington in the past. Turkey bought the Russian system despite repeated warnings from the US, and was sanctioned and booted from the F-35 fighter program in 2019 in response.
White House Warns Of ‘Escalating Vulnerabilities’ To U.S. From Semiconductor Shortage
The White House held a classified briefing on Wednesday with some U.S. lawmakers on the dire risks to the American economy from semiconductor supply chain issues as it pushes Congress for $52 billion in funding to subsidize production.
White House National Economic Council Director Brian Deese told reporters “the best estimates are the lack of available semiconductors probably took a full percentage point off of GDP in 2021.”
The briefing included Commerce Secretary Gina Raimondo, Deputy Defense Secretary Kathleen Hicks, National Security Advisor Jake Sullivan to “discuss the urgent need to invest in made-in-America semiconductors as well as research and development that will protect our economic and national security,” the White House said.
A persistent industry-wide shortage of chips has disrupted production in the automotive and electronics industries, forcing some firms to scale back production. There have been growing calls to decrease reliance on other countries for semiconductors.
“A significant interruption to our supply of semiconductors could cause historic damage to the U.S. economy – damage far greater than the impact of chips shortages on the American auto industry right now – and would undercut our technological competitiveness and military advantages over adversaries globally,” the White House said.
The White House has been pushing Congress to approve U.S. subsidies for semiconductor chips manufacturing after months of discussions.
The Senate first passed $52 billion in chips funding in June that also authorized $190 billion to strengthen U.S. technology and research to compete with China, while the House of Representatives passed its version in early February. Deese said he hopes both the Senate and House will appoint negotiators this week to “quickly” begin a formal process to finalize a compromise bill.
“The risks are profound,” Deese said of what would the U.S. economy face with a severe disruption. Deese cited “economic moves by key competitors – most notably China around the escalating vulnerabilities we have from the semiconductor issue.”
A Commerce Department analysis that was prepared for the briefing seen by Reuters noted semiconductor fabs take years to construct.
“There is no quick fix in the face of emergency,” it said, adding private sector investment in U.S. chips production is not enough and “will not be sufficient to mitigate the risks associated with the current U.S. supply chain vulnerabilities.”
The Biden administration notes the U.S. produced nearly 40% of all chips in 1990 while today it accounts for only 12% of global production.