Page 36 - bne magazine February 2022_20220208

36 I Cover story bne February 2022
events to take their course (no invasion), and then to claim the credit for
a successful deterrence operation.
US policy is also, always, influenced by profit. US companies have built a long string of liquefaction trains to export liquefied tight methane to consumers around the world. At present the EIA estimates that total US export capacity is in the region of 140-150bn cubic metres per year. The original intention was
to supply Asian buyers – Europe was always seen as a small potential market since it can buy cheap pipeline gas in large quantities from Russia, Algeria, Norway, the UK and Denmark.
But setting Europe at odds with Russia upsets one leg of that competitive threat, and potentially opens the door to large- scale supplies of LNG from the United States, at highly profitable end-prices and with much shorter (and more profitable)
infection rules in 2020. Few outside Parliament believe Mr Johnson’s narrative.
Inside Parliament only 100 of the 358 Conservative members of the House
of Commons have signed a letter of support for Mr Johnson (and it must
be remembered that approximately
100 members of the Commons are also members of the Government at any one time). Mr Johnson’s chances of surviving as leader and Prime Minister rest on
two circumstances – his ability to win
a future election, and the fact that Nato is in a crisis over the future of Ukraine. The leadership’s case to MPs is partly that it would be highly dangerous to be leaderless at a time when the United Kingdom might find itself at war.
It is therefore firmly in the interests of Downing Street to inflate the risks of a major conflict to the maximum, while knowing (as does Washington) that it can
Articles 25 and 26 of the Lisbon Treaty. Article 25 mandates that the EU shall have a common foreign and security policy, and Article 26 mandates that member states shall (not may) give it effect under the direction of the High Representative (the EU’s Secretary of State).
So far, EU member states have completely ignored both articles, but the Commission plays a long game. In order for the Articles to gain real living force
it is necessary for the influence of Nato (polluted in the Commission’s view by the relative military weight of the three Anglophone states) to diminish. For that to happen, Nato must be seen to have failed in some material and critical way.
The Commission must be quietly hoping that the Ukraine crisis will provide that failure, as the foreign policies of the Anglophones and Europeans visibly part company and the resulting geopolitical stress leaves Europeans shivering in their homes this winter for lack of gas.
In this context it is also important to remember that Nato and Europe are not coincident. Seven EU states (Finland, Sweden, Ireland, Malta, Austria, Cyprus and Croatia) are not members of Nato, but do have foreign policy weight which might be used to pull other European states away from Nato and towards Brussels. Anglophone aggression will add to that pull.
There is an old Civil Service saying – “never let a good crisis go to waste”. It seems that all of the key players in this crisis are making good use of it.”
“In London the agenda is probably more Personal where the Prime Minister is struggling for his political life”
voyages from the Gulf of Mexico. The volumes of production available are highly material in the context of Europe’s gas import demand, though with the snag that a single large LNG carrier can deliver only about 0.1 bcm per voyage, creating bottlenecks both in ship- availability and in gasification terminals. The margins on offer are eye-watering. US tight gas leaves its liquefaction train at about $8 per mmBtu, while in Europe gas is currently wholesaling for around $30 per mmBtu and touched $38 at the end of 2021. If US producers supplied just 50 bcm of European gas, and if wholesale prices moderate by a third, to $20 per mmBtu, the net profit on offer would be around $1bn per month.
In London the agenda is probably more personal. Here the Prime Minister is struggling for his political life under charges of hypocrisy and outright lying over whether Downing Street followed its own stringent coronavirus (COVID-19)
www.bne.eu
later stake a claim to successful deterrence, whose credit will accrue to... Mr Johnson.
The White House and Downing Street are not the only beneficiaries of hysteria. Sitting quietly in the background all this time has been the European Commission. Here the underlying agenda flows from
Here's a plan, Boris.