European Sanctions Cause Russian Natural Gas Collapse

Most of Europe has been working to reduce dependency on Russian natural gas, and boy, did they deliver. Russia’s natural gas state monopoly, Gazprom, has just reported its lowest output levels since 1978.

Sanctions targeting piped natural gas have effectively cut off supply to Europe, and the exisiting infrastructure cannot be easily redirected. While Russia has alternative natural gas sources and facilities, the limited workforce and technical challenges make these options difficult to maintain.

European sanctions are working well, and these efforts may permanently sever ties to Russian natural gas with little impact on their own systems. The Russian natural gas industry is facing an unprecedented fall from grace, but not all industries have been impacted equally…

Oil, however, is a completely different beast. We will deal with that tomorrow…

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Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

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Transcript

Hey everyone. Peter Zeihan here coming to you from Colorado. And the news today is that Gazprom has announced its full year output levels. Gazprom is the Russian natural gas state monopoly, and it is the lowest that it has been since 1978. So. Well, pre-dating the Soviet collapse. And the reason is pretty straightforward. The Europeans have tried to cut their dependency upon Russian natural gas to zero.

And at least in terms of the piped natural gas, they’ve been pretty successful. Now, this is something that is not exactly a shock to people who are familiar with the industry. There are many aspects of the sanctions that are working better than others. This is one of the ones that definitely working better. And the reason is the nature of natural gas itself.

Natural gas is a gas, and it takes a specialized system to produce it, to transport it, and to export it. And if there is a gap anywhere along the system, whether it’s insurance or the pipes or the pumps or the legalities or whatever it happens to be, the whole thing stops and it can’t easily be redirected. And in the case of the Russian stuff that goes to Europe, almost all of it comes from an area called Uruguay, which has been in production now for a half century, goes down a couple thousand miles of pipes through Ukraine and Belarus, into Poland, Germany, Slovakia, Hungary and the rest.

And since this can’t be redirected. When the Europeans stopped taking deliveries, the Russians had to, bit by bit by bit, shut everything down. There are other natural gas options that the Russians have. There’s some that comes from eastern Siberia, well east of the Urals, that goes south into China. There are a couple liquefied natural gas facilities, one on Sakhalin Island, primarily, which goes to Japan and one of the small peninsula, which primarily gets shipped to Europe.

And those are still working mostly. But we should expect even those to go off line in the not too distant future. The problem is, is that those other facilities, the Yol, Yamal, LNG, Sakhalin, LNG, and it’s called Comvita, which is a field in the general vicinity of Irkutsk out near Lake Baikal. Those are all much more technically challenging, and the Russians didn’t do any of the work to bring them online.

That was almost exclusively done by foreigners with British major BP being the single largest player. But the Japanese Mitsui Mitsubishi are involved in Stockland as well as ExxonMobil, and most of those companies are now gone. The Japanese are still involved in Stockland, but ExxonMobil and BP are just cut their losses and left completely. And the Russians do not have the technical skills necessary to maintain those projects in the long term.

As for whether or not the Russians can come back, you know, that’s an open question. The Russians used to be the best in the world when it came to ice production and tundra production. But that was in the Soviet period. And the Soviet industrial educational system collapsed around 1985 and the Russian birthrate collapsed in a similar timeframe. So not only do they have a significantly fewer people who could theoretically be trained up in engineering the system that trained them is born.

So the youngest people who have the full suite of, say, petroleum engineering and reservoir management experience are now in their early sixties, and there just aren’t that many of them left. And for the last 20 years, most of the meaningful maintenance work that has been done in places like here in Hawaii, most of the worked on improving recovery rates has been done by foreigners with BP and ExxonMobil and to a lesser degree, the Germans and the Dutch being the major players.

That’s all gone. So Uruguay being a mature zone could probably be brought back as a significant production zone if you applied shale technologies in mass. But as the Americans have shown, shale works in areas that are relatively close to population centers because it requires a significant amount of labor. And it doesn’t work very well in places that freeze solid because you need a lot of water.

And Uruguay is a thousand miles from anything that matters. So that will probably never come back online because the Russians can’t do it themselves. And the technologies that might allow it to work simply are inappropriate for the geography in the case of exports to Europe. They are now down by 85% compared to the start of the war. What is left is just a trickle that is going to three countries Czech Republic, Slovakia, Hungary, who really don’t have any alternatives to taking natural gas supplies from the Russians, which is one of the reasons why Hungary, Slovakia and to a lesser degree Czech Republic have been the three countries that have been most opposed to the sanctions

regimes in general, and most of the exceptions that have been carved out of the sanctions regime involve those three countries. That’s not going to change this year. That might start to change next year as the Europeans are building up lots and lots of lots of interconnections so that they can cut their links to Russia. Natural gas for good.

And when that happens, all that will be left of the Russian natural gas industry is what’s going through the domestic markets. And perhaps cyclin LNG because the Japanese are involved there. And that’s completely separate political question. But that is crazy because you’re talking about the world’s largest producer and largest exporter of natural gas vanishing from global markets in less than four years.

And that is absolutely unprecedented. Honestly, it’s more than a mild shock that the price shocks that the Europeans have felt at this point have been so mild. They really have been able to bring in liquefied natural gas from other suppliers, most notably a Persian Gulf in the United States. This has put a lot of price pressure on everyone else who used to get natural gas from those locations.

But to this point, I got to hand it to the Europeans. They have put together a sanctions regime that at least in part, is doing exactly what they hoped. Jeremy. Russia now exports, cutting Russian income without unduly shocking their own system. I honestly did not think they could pull this off, but so far so good.

Ukraine War: Russia Targets Grain and Power Grid

If you’ve been around since July, you might remember me talking about Russia targeting Ukrainian agriculture instead of the power grid. If you want a little refresher, just click here:

READ “The End of Ukrainian Agriculture” HERE

As of September, Putin has sufficiently disrupted Ukraine’s grain exports and overall agricultural sector. Meanwhile, the Russians were bolstering their wheat exports, so global supply has held steady, and prices are still down.

Don’t rely on this Russian grain, though, because new sea conflicts, impacts on shipping routes and an unpredictable climate could change everything at the drop of a hat. The best course of action would be to help Ukraine develop better rail infrastructure and grain transport options.

As the temps begin to shift, we will see the Russians change up their strategy once again. They will transition from attacking Ukrainian agricultural infrastructure back to targeting the power grid…but just because the Russian’s focus has shifted, doesn’t mean grain markets will be stable.

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Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

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Transcript

Hey everybody. Peter Zeihan here coming to you from Colorado today. The topic is going to be the next phase of the war in Ukraine and from an economic point of view. For those of you who’ve been watching for a while, you know that last winter the Russians went out of their way to hit the power grid in Ukraine wherever and whenever they could, because that was the way they could generate the most casualties and have the most political impact on decisions in Kiev.

And then in about May, once it had warmed up enough that you didn’t necessarily need heating in Ukraine, they switched targets to the agricultural supply chain system with a very, very heavy emphasis on the infrastructure that collects and especially exports the grain take it out. Things like grain silos and ports first in places like Odessa, and then later moving on to the Danube River Delta, which is where the Ukrainians and tried to get the stuff out.

In this, the Ukrainians have kind of faced a triple bind. Number one, they import most of the materials that are necessary, like fertilizer, in order to grow crops in the first place. Number two, there isn’t a lot of storage in Ukraine that was available because of last year’s efforts in the war. Most of the storage was full completely.

So the Ukrainians were focusing on getting that out so they could make room for this year’s harvest. And in some degrees, there has been failure there. And this stuff has nowhere to go because number three, almost 80% of this maybe even a little bit more, goes up by water, primarily through the Odessa region. And with that kind of off line, the only other option is to rail it out.

And that means you have a limited number of rail cars. You have to ship it through other countries that are already grain exporters like Bulgaria, Romania and Poland, who don’t like the idea of that stuff being dumped on their market. So most of them have barred Ukraine from having terminal arrivals for their grain and you have to keep on going.

So for every kilometer you have to go further. That’s a kilometer that that railcar has to be committed. So all in all, you’re talking about over an 80%, nearly a 90% reduction in Ukraine’s ability to get the stuff out. And now that a lot of these ports on the Danube have been damaged, there’s just no place to put the stuff from this year’s harvest.

So from the Russian point of view, mission accomplished. And now they’re switching targets. This past week, the week of the 18th of September, they’ve started switching targets again because we’re now getting into fall and they’re going after the power grid again. And over the course of the next month, I would expect that general shift to be almost complete.

They’ve destroyed the Ukrainians ability to play in international grain markets any in any meaningful way. And now they’re going to have the power grid to cause mass casualties again there. So definitely, you know, the Russians have absolutely won this round. The only way that the rest of the world might be able to help is to massively, massively expand the rail connections between Ukraine and their neighbors.

And then the next line of countries beyond. It’s not enough just to get the stuff to say, Poland or Romania. You’ve got to get it on to the water. And that means you also build out the lifting infrastructure for transferring something from rail onto a ship, because these countries were already grain exporters. That stuff is already used to capacity.

You can basically need to double the entire thing. Normally you would expect something like this to be really bad for grain prices are good, I guess. Depends on your point of view. Send them up. But miracle of miracles. The Russians have had a bumper harvest so they have increased their wheat exports by over a third and that by itself is nearly enough to compensate for all the Ukrainian grain that has left the market.

So wheat prices are actually down. Now, I am not a grain trader and I’m not trying to give you anybody price recommendations, but just a couple of things to keep in mind. Number one, the Russian climate is incredibly erratic. And so just because they had a bumper crop this year doesn’t mean they’re can have a bumper crop next year.

Keep that in mind. Number two, the Russians have said that any vessels, civilian vessels anywhere in the Black Sea going anywhere near a Ukrainian coast, they reserve the right to attack. The Ukrainians are trying to convince people to come anyway and they’ve had very, very, very limited success. But that war risk is always there. And for their part, the Ukrainians have said and have demonstrated that they can strike Russian ports as far away as never seasick, which is their major green loading facility for the Russians.

Now, they have not gone after civilian vessels yet, but again, there’s still the possibility that we can have a widespread war on the water, in which case all civilian shipping in the north eastern half of the sea is in a degree of risk. So for the moment that there’s enough grain out there, I’d not get used to it.

But at the moment, that’s where we are. Okay. Talk to you later.

Chechnya: Russia’s Influence and a Volatile Future

Today, we’re looking at Chechnya’s tumultuous history with Russia and what the future might hold. After two wars, a few decades of nominal Russian control and ruthless leadership, the tides might be turning for Chechnya.

That ruthless leader I mentioned, Ramzan Kadyrov, hasn’t quite set the Chechens up for success. However, as his health comes into question, so does the future of Russia’s role in Chechnya.

If Kadyrov kicks it, several complications arise for the Russians. There’s no succession plan, the flow of information could be cut off, regional allegiances could shift, and with the ongoing war in Ukraine…things could get spicy.

While it may seem like all of this is contingent upon Kadyrov’s death, most of it is inevitable. Sure, Kadyrov could help speed things along, but Chechnya (and this region as a whole) has plenty of dynamism and volatility in its future.

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Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
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Transcript

Hey everybody. Peter Zeihan coming to you from Colorado. We’re doing the next in kind of an open ended series on the Russian positions throughout the former. Soviet world and how they’re disintegrating and what that can mean. We’re talking about Chechnya today now. Chechnya is a little statelet, a republic of the Russian Federation that tried to break away back in the 1990s when the Soviet system collapsed.

There were two major wars. In the first one, the Russians were soundly and embarrassingly defeated and in the second one, the Russians were able to split the Chechens into groups and allied with one of the more powerful factions. And in doing so, reassert nominal Russian control. Emphasis on the word nominal. Basically, the Russians provided this one group with troops and equipment and intelligence and money and combined with the Russian forces, they were able to defeat the others.

Part of the terms of the deal were was, though, that the Russians pretty much had to leave. And so the Russians still lost control of Chechnya. But at least nominally, this faction does adhere to what Putin says he wants to do, even though, for all intents and purposes, this faction is independent. Now that faction is run by the Kadyrov, claim a courier off.

The father was killed in an assassination attempt back. And I want to say 2000 2000 won. And his son Ramzan is, I think the most clinical way I can put it is an absolute fucking psychopath. Tortures people, murders people, runs the place in a reign of terror. Definitely not the kind of guy that you want to meet under any circumstances, or preferably even read about if you have an option anyway.

Kadeer off the junior has become part of the political support system for the entirety of the Putin regime across Russia, where he engages in a lot of intimidation, provides shock troops for, say, things like in Ukraine and does a considerable amount of what work, which is, you know, a fancy name for assassinating people that Putin doesn’t like. Now, the news that has come out over the last few days is that there’s something wrong with Rahm’s health.

Now, he has released a video as of the 21st of September showing that he’s clearly alive. And so whether there’s anything true to the rumors, I have no idea what I can tell you, that the situation where could here if JR is in league with the Russians is of limited duration and a lot more fragile than people think.

Remember, he’s basically being paid in men and equipment and intelligence and of course, cash to be on the Russian side. So if something happens to those fellows, his loyalty is, you know, available to the highest bidder. Also, he is the leader of one faction, a powerful faction. Yes, but only one in Chechen society. So if you had a change in circumstances, it’s easy to see that you can have a power struggle erupt in this area very, very, very, very quickly.

And who knows how that would shake out. And it’s perfectly reasonable to think that this would descend into a bit of a civil war among the Chechens themselves, because there are Chechens in Ukraine fighting against the Putin government and the Chechen shock troops that Kadyrov has brought in. I mean, this is not a unified polity by any stretch of the imagination.

So there are kind of four things you have to keep in mind here, that if something were to happen to Kadyrov, that we would see a lot more instability and especially incapacity for the Russians to maintain the position. The first is that there’s no second in charge in Chechnya. It’s just Ramzan himself, his sons. The oldest one is 17.

They’re certainly in no position to take over. And it’s not like they were raised in the rebellion. They were all born after the war ended. They were have been raised in the lap of luxury. And they have very active Instagram accounts. They’re social media stars among Russian nationalists and Chechens. But it’s very clear that it’s all airbrushed. And these are not people who have actually had to do any real fighting.

Could they rise to the occasion if their father was just to disappear? Maybe. But there would be plenty of others who would also try. And that’s the whole point would end in a struggle. Number two, it’s not clear that this the group of Chechens that are working for the Russian government are easily replaceable. One of the things we’ve learned throughout all of the conflicts in Ukraine with first the Orange Revolution and then the made in protests and then the 2014 war in Crimea.

Now, most recently, the 2022 war in Ukraine is that Russian intelligence authorities are not nearly as competent as they used to be. Most of the good ones went off in the 1990 and early 2000s and kind of got into business and got into crime themselves and haven’t come home. So Putin is really relying upon Kadyrov clan to do a lot of the work that used to be done by kind of the dirty hands of some aspects of the intelligence bureaus.

And if that were to vanish or, God forbid, turn on Putin, it’s not clear that it would go really well. Third, there’s more going on with the Chechens who are working for Putin than just the stuff within Russia and Ukraine. The Chechens have their fingers in a number of other frozen conflicts in the region, in the Caucasus, most notably a trio of regions within the former Soviet Republic of Georgia, which has often found itself on the receiving end of Russian violence.

There’s a Chechen enclave in a place called the Pankisi Gorge, which is just north of Tbilisi. That kind of is a de facto independent zone. And then there are two zones, Abkhazia and South Ossetia, where the Russians actually have regular troops there. And they’re physically maintaining the independence, really occupied nature under Russian control from the Georgian authorities. And if the Chechens were to flip and just go neutral in those positions, it’s not clear with the Russians being as distracted as they are by Ukraine whether or not these areas could continue to be functionally independent.

And the Georgians, of course, would love to take those territories back and then fourth and most importantly, one way or another, we’re probably going to see a reckoning here in terms of strategic control. If the Ukrainians are even marginally successful at resisting the Russians, eventually some aspects of this war are going to get to the city of Rostov on Don in southwestern Russia.

And Rostov is the primary launching point for Russian forces operating in eastern Ukraine. And it is the only launching point for Russian forces operating in the Crimean peninsula itself. And if it becomes constrained, that is what the Ukrainians need if they’re going to ever win this war. But Rostov does more than just serve as a launching point for Russian operations in Ukraine.

It’s also the primary launching off point for Russian operations throughout the entire Caucasus, including in Chechnya. So even if Kadyrov remains loyal, any even moderate success by the Ukrainians is going to impinge upon the Russians ability to influence the Caucasus at all. And then Kadyrov, when it becomes clear that the weapon and the men and the money might not be coming in the same value, he is going to have to make some decisions on his own.

And if even as he sticks where he is, other groups throughout the Caucasus, the Azerbaijanis, the Georgians, other Chechen groups, the Dagestan, he’s it’s the long list are going to start looking at the change in circumstances when the Russians simply can’t project power in force to the Caucasus region. And when that happens, the Russians will be dealing with a multi-front series of rebellions and wars that they really have proven.

They don’t have the logistics and the manpower to deal with. So Kadyrov is clearly important and his health, his survivability, his political standing, where he sides with this faction, that matters greatly. But if you step back and look at where this is going from a big picture point of view. Kadyrov’s Change of heart or change of health could only speed things up.

A lot of this stuff is inevitable. A lot of this stuff has to happen anyway. It’s just Kadyrov could make it happen tomorrow instead of three years from now.

What Happened to the Arms Control Treaties?

If you’re looking for something to ponder over a glass (or two or three) of nice whiskey, you may want to save this newsletter and video for then…

Now that you’ve returned with your spirit of choice, we’ll be looking at the history of arms control treaties and today’s lack thereof.

Towards the end of the Soviet period, arms control treaties with the US peaked under Gorbachev, but each US President has handled these differently. Treaties fell off under Clinton, had a bit of a resurgence under George W. Bush, and have since fallen off. Today, the post-Cold War arms treaties have all but vanished (at least in practice).

Now, onto the really stressful stuff – cue the 2nd glass of whiskey. Without these treaties, several concerns arise…can Russia maintain its nuclear arsenal? What happens if things go nuclear? What if they launch a nuclear weapon and it fails?

There are too many moral and strategic dilemmas to even think through, but we should probably have some sort of roadmap to guide us through these scenarios. Unfortunately, policymakers have no established procedures for specific situations like a failed nuclear strike attempt, which is quite a conundrum.

Prefer to read the transcript? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts

Transcript

Hey, everybody. Peter Zeihan here, still in Arizona. Last Friday, we talked about the pending deal for weapons transfers between North Korea and Russia, with the Russians getting North Korean artillery and most likely the North Koreans getting Russian launch technology, probably long range missiles. I thought it might be worth to do a little walk down memory lane today about arms control, most meaningful arms control that the United States has participated in, the shape the world was between the Americans and the Soviets at the end of the Soviet period under Gorbachev.

Things like the anti-ballistic missile Treaty, the start and the SALT treaties and such. They hit their height under George Herbert Walker Bush, which under that administration, and then Gorbachev and Yeltsin negotiated down the ceiling for nuclear weapons from 30,000 to under 6000, well, roughly 6000. And then things kind of stalled under the Clinton administration. Clinton saw himself as a domestic president, really was not interested in foreign affairs much at all.

And after it became apparent that Yeltsin was, well, let’s just call him mildly corrupt, the desire to be affiliated with the Yeltsin government was relatively thin anyway. Al Gore kind of was subcontracted out to handle foreign affairs. But once Clinton got involved in domestic scandals involving interns, pretty much all foreign policy just kind of melted away. And so we didn’t have much progress under that administration.

The administration came in and hit the ball fairly well with Vladimir Putin in the early days. In fact, many things that the United States did in the global war on terror in Central Asia wouldn’t have been possible without a partnership with the Russians and under that sort of environment. There is a bit of a renaissance in relations and there was another phase two arms control which negotiated down the level further.

It wasn’t perfect because the level went from roughly 6 to 7000, down about 1500. But the missiles I’m sorry, the warheads in between weren’t necessarily destroyed. They were simply removed and stored separately. Still better than being on the hair trigger, but it wasn’t perfect. Under Obama, Obama didn’t like to leave the Oval Office unless it was for the campaign trail and nothing happened under Trump.

What was left of the treaties kind of fell apart as the Russians fell into this narcissistic fascism that they’re in today. And then obviously under Biden relations of torpedo completely because the Russians are on a genocidal warpath. Where this leaves us is that the Cold War, post-Cold War treaties, for all intents and purposes, are gone. As of a few years ago, no one was really abiding by them, and now everyone’s pretty much officially withdrawn from them.

About the brightest spot we’ve got in that is that the Russians very clearly are having industrial issues in maintaining their conventional weapons. That’s an open question whether or not they’re capable of maintaining their nuclear weapons. Now, this puts the Biden administration really all administration’s for countries that have nukes, which includes the French and the British as well, in kind of an awkward spot, we now need to entertain scenarios where the Russians would actually be willing to hit the big red candy button.

They probably wouldn’t do it. And less regular Ukrainian or God forbid, NATO forces crossed the international recognized border into Russia proper. Which case would be defensive use or if the Russians do manage to subdue Ukraine, that doesn’t really solve their security issues. They have to continue on into Romania, Estonia, Latvia, Lithuania and Poland in order to narrow the apertures of approach for foreign forces to Russia.

Russian Alliance. Also, this has always been about, but we now know that Russian forces are kind of crap. And in that scenario where they’d face off against NATO’s irregular forces, they’d probably be obliterated. Casualty ratios would be extreme on the Russian side, and that would only leave them with nukes in order to compensate, which is one of the reasons.

What’s the primary reason why? Washington, London, Berlin, Paris and the rest have been so gung ho on helping Ukraine in order to forestall that possibility. But it also raises what could potentially be the nightmare scenario. We know that the Russians are having problems maintaining everything, and we know the Russians have lacked the industrial capacity to build new stuff.

So everything they have is old. In the case of these missiles, things that were built in the seventies in many cases. So what happens if Putin hits that big button and nothing happens? What do you do to someone who just tried to kill half a billion people but failed? No criticism of the Biden administration here. That’s a tough call that no one has ever faced when they’re sitting in the big chair before.

It’s not destined to happen. But I would say from an arms control nuclear power point of view, that is my single biggest concern right now. What do you do when the intent is there, when all the pieces are there, but on the day that you hit the button, it just doesn’t happen to work because you know they’re going to hit that button again, again and again and again, again, very, very quickly.

And we no longer have the procedures in place to try to diffuse that situation, largely because the Russians have ended them. So if you want to stress about something, I give you permission to stress about that. Take care.

North Korea to Provide Russia with Military Aid

Putin and Kim Jong-un finally had their little tea party at the Cosmodrome out in the far east of Russia. Besides boosting each other’s egos and gossiping a bit, it looks like the main discussions revolved around North Korea providing military assistance to Russia in the form of artillery shells.

Since Russia’s war on Ukraine won’t be letting up anytime soon, they need to replenish their dwindling supply of artillery shells. With limited options, Russia will have to settle for outdated North Korean supplies – not quite the pick of the litter here.

What does North Korea get out of this deal? Russia doesn’t have much to offer, but they could transfer some long-range missile tech to the North Koreans…and that’s cause for concern.

Given this deal’s regional and global security implications, countries like South Korea, Japan, China and the US should be worried. Sure, there are sanctions in place, but in all reality, those minor deterrents won’t stop North Korea.

Prefer to read the transcript? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts

Transcript

Hey everybody. Peter Zeihan here coming to you from Phoenix, Arizona. Today, we have to talk about the summit between the strongmen of Russia in Korea, of Vladimir Putin on the Russian side and Kim Jong un on the Korean side. They met in one of the Russian Cosmodrome in the Far East and the primary topic was whether or not the North Koreans can provide the Russians with military assistance, which for anyone who has a sense of history.

The irony here is practically believing out of the sky anyway. The issue, of course, is that the Russian war in Ukraine is not going to spark. And when you have a conscript heavy force like the Russians do, you try to use standoff weapons that aren’t really smart in large volume, specifically artillery. If you exclude either China or the United States from the math, Russia has more artillery than the rest of the planet combined.

And best guess is, by the end of this year, they’ll have gone through over 20 million artillery shells, artillery shells don’t age particularly well. And after they’re more than like ten, especially after 20 years old, the explosive start to crystallize a little bit and that can make things decidedly lively when you try to, I don’t know, move them, especially when you try to launch them.

So the Russians have had a lot of accidents with the transport system, their logistical system. And then, of course, they’ve had a lot of barrels and the artillery to blow up from the inside. All of these are bad things if you try to launch a lot of artillery. So they need more shells and they’re turning to North Korea, which I believe has the world’s fourth largest stock of artillery.

The problem here, of course, is that North Korea’s industrial plant isn’t exactly great either. And a lot of the North Korean stuff is actually older than the Russian stuff. Gives you an idea of how desperate the Russians are for ammo. Now, the question, of course, is what are the North Koreans get in return? Because the Russians don’t have anything from a trade point of view that’s of use.

You might be able to send a few tankers of crude oil. But the Russians honestly need that for hard currency earnings. So the questions, if there’s anything else can be transferred in terms of military technology, there really isn’t. One of the things that the Indians have found out recently that they’ve been developing missiles and planes with the Russians, where the Indians provide a lot of the capital, and then the Russians provide the technical know how.

And what they’ve discovered is very few of those contracts are actually being honored by the Russians. So because the Russians have lost the technical capacity to manufacture even moderate numbers of planes. So they’re now starting to back out of all their contracts because they realize that the Russians have been lying to them the whole time. In addition, there’s some talk of like maybe a nuclear powered vessel or submarine, but it’s taken the Russians 15 years to build their last nuclear powered ship, which was an icebreaker.

So argue the argument to be made here is whether or not the Russians even have the capacity to sustain their existing nuclear naval fleet, much less build new ships for themselves, much less have surplus to transfer to North Koreans. And honestly, it’s looking pretty poor for that. That doesn’t mean the Russians have nothing, and it doesn’t mean that there’s not a problem.

This is probably not going to be the things that most people are talking about. Look at where the meeting was, the Cosmodrome. This is a facility out in the Far East that the Russians built when they lost control of the Kazakhstan Cosmodrome at the end of the cold War. And when it comes to launching satellites or intercontinental ballistic missiles, the Russians are still one of the few places in the world where that technology can theoretically be obtained, even if the Russians have lost the capacity to build a lot of new stuff themselves.

So the primary global concern, primary regional concern for North Korea is missiles long range missiles. And that is something the Russians have in spades. So whether it’s officially part of a program to launch a satellite into space, which, you know, whatever, or more likely to deliver a payload to another hemisphere, that is something the Russians can and probably are willing to transfer to the North Koreans because the Russians are no longer party to any meaningful arms control treaties at all, which will generate no end of headache, not just for the South Koreans and the Japanese and Chinese who.

Newsflash, the North Koreans hate the Chinese, but also the United States. There’s not a lot the United States can do about this because the North Koreans are not in a position where sanctions work at all. You can do as punish the Russians indirectly and hope for the best. And that’s not a great security strategy. But that is where we are.

Yeah, that’s all I got bye..

Ukrainian Drones: A New Issue for Russia and China

The super moon (or blue moon or whatever it was) didn’t have just the animals stirring last night…and since I couldn’t sleep, I figured we should talk about Ukraine’s recent drone attack and its ramifications.

While Ukraine being able to strike deeper inside Russia’s border is a significant strategic win, I’m not just up late thinking about the damage they inflicted. As Russia continues to face more and more attacks like this, the ability to defend and uphold its national coherence is now threatened.

Russia is a multi-ethnic empire; it expands and absorbs territories until it reaches defensible natural geographic barriers. The Ukraine War is just another example of this in practice (and success would mean delaying Russia’s demographic collapse). However, as dissent bubbles up amongst these various ethnic groups, what happens if Russia can no longer monitor and put the lid on it immediately? How could it possibly project power outside its borders?

The Russians aren’t the only ones feeling the heat after this drone attack. When a country like Ukraine can practically walk into a Walmart and get what it needs to launch a large-scale assault, that’s one heck of a conversation starter for the Pentagon.

Once the US amasses a – flock – of drones, they’ll have another way to attack the Chinese navy should they need to. The irony is that most drone parts come straight out of China. So the Chinese could stop exporting this stuff and hurt their economy, OR they could continue handing over the very thing that might end them. I’d say that was worth waking up for…

Prefer to read the transcript? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts

Transcript

Hey Everyone. Peter Zeihan here coming to you from Colorado. It is early in the morning on August 31. It’s the supermoon and the woods are kind of crazy with the animals. And I couldn’t sleep. And whenever I can’t sleep, I just kind of let my mind wander and see where it goes. So I’ll let you to be the judge of whether this makes any sense or not.

Yesterday, my time on the 30th, the Ukrainians launched their largest ever drone assault on Russian positions across the length and breadth of western Russia. At least a half a dozen different locations, some of which were several hundred miles from the Ukrainian border, doing a moderate amount of damage to a few things and taking out some long range aircraft, specifically the aisle 76 long range transport aircraft that the Russians use to transport paratroopers.

They’ve been building in terms of their drone attacks, doing more and more, further and further. And a couple of weeks ago, they took out a couple of backfire bombers, which are long range bombers, which launch long range cruise missiles which were designed to shoot an American carrier, battle groups and military convoys in the North Atlantic. You know, all very long range aircraft, strategic aircraft.

And it occurs to me as I was lying there in bed, that we may have had a turning point in the war, not on the Ukraine front, but on every other front that matters. Well, let me kind of dial that back and explain what I mean. Russia is not a normal country. It’s not a unitary republic like France or a federated country like the United States.

Instead, it’s a multiethnic empire. The Russians have never really had territory that is, from their point of view, secure. So what they do is they expand through the flats of Western Eurasia, absorbing ethnic group after ethnic group, until they reach a series of geographic barriers that you can’t push through easily, like the Carpathians. So this is one of the reasons why I’ve always thought that this war in Ukraine was inevitable, because the Russians are trying to rebuild that outer crust of defense that they had during the Cold War and with their own demographic decline.

If they don’t do this while they still are able to field a large army, they are looking at collapse over the course of the next 10 to 30 years. This is all about buying time for them. So from a strategic point of view, the war makes sense. A lot of sense. That logic works both ways. However, in order to maintain control of a multiethnic empire, you have to have a really deep intelligence system that monitors the population for any sign of dissent, and then you rapidly rush troops to any areas where there is a rebellion in order to quash them, which means that the Russians don’t simply need a long range power projection capability in

order to fight Naito or China or Japan or anyone else. They need it simply to hold their country together. And over the course of the last month, especially on the 30th, the Ukrainians have demonstrated that the strategic deployment assets, those IL 76 is those backfires that the Russians need simply to maintain their national coherence are now being threatened.

So everything that I’ve said about the Ukraine war to this point I think still stands. But we now need to consider that an aspect of the Ukraine war is that Ukraine is demonstrating that Russia proper might not be sustainable, even if they win the war in Ukraine. And that is something that has got to have a lot of people in a lot of capitals stroking their chins thoughtfully, because the Ukrainians didn’t do this with neater weaponry.

The United States, NATO’s, everyone else, the refusing to provide the Ukrainians with weapons that could be used for deep strike capability within Russia because they don’t want to risk any sort of nuclear exchange. This Ukraine did this by themselves and Ukraine did not start this war with a drone fleet, much less a long range one. This is stuff that they built with off the shelf commercial components, primarily from China.

 

You know, irony of ironies. And if you can do that by basically shopping at Wal-Mart, then the stability, the very existence of the Russian state is all of a sudden called into very serious question just from an internal coherence point of view. And there’s issues about this that carry over outside of the theater of the Ukraine war, Russia.

 

I mean, I’m talking here about China because over the course of the last couple of days, there’s been a lot of noise out of the American Pentagon, specifically from Admiral Hicks, about something called the Replicator initiative, which is to take off the shelf inexpensive commercial grade drone technology and make literally thousands, if not tens of thousands of attack drones that can be used to basically sink the entire Chinese navy.

They’ve seen in Ukraine how effective the strategy can be. Supposedly, they’ve already built the technical specs for what they want and they hope to have the entire fleet deployed in under two years. Now, a couple of things to remember about the Chinese side of things. Yes, the Chinese have a very large navy in terms of number of ships about twice the size of the American Navy.

Now, the American Navy still outclasses it. We have much larger ships with much larger ranges, and most of them are centered around the aircraft carrier battle groups. China has nothing like that. But the biggest restriction the Chinese face is the ability to operate far from shore. About 90% of the ships can’t operate more than a thousand miles. So you’re talking about most of them operating within the first island chain of Japan, Taiwan, the Philippines and so on.

That the East China Seas. The South China Seas. Well, if the United States has these long range legacy ships that can operate over a thousand miles from their adversaries and just poke at them first with fighter craft and with bombers and now apparently with drones. And you’ve basically turned the entire East Asian littoral into a graveyard for the entire Chinese navy.

The biggest problem is Admiral Hicks point out, is that the Chinese have mass a lot of ships, a lot of people. But if you throw a thousand drones out and all of a sudden that’s not so much of a problem. And the irony of ironies, the Americans are going to be using off the shelf, commercially available drone tech for this.

Most of that comes from China. So the U.S. military is going to be mass sourcing from China, the very systems that are necessary to end China. And the only way that China could stop that is by stopping exporting drone parts, which would mean, you know, destroying a section of their economy right now, which we would probably be fine with if that is the retaliation.

The United States gets a lot of crap sometimes for good reason for investing in weapons systems that maybe were designed to fight the previous war. But the Chinese have done that too, and they now have a very large fleet of vessels that is simply incapable of dealing with the American military as it is now, much less one that might have additional backbone because of something like the Replicator initiative.

Okay. I’m going to go try to sleep again now. I hope everybody has a great night. Take care.

The BRICS Summit: Significant or Hoopla?

Have you ever seen a couple of 3-year-olds sitting on the playground talking gibberish and acting like they’re making life-changing decisions? Well, that’s what’s going on at the BRICS summit in South Africa this week.

BRICS comprises Brazil, Russia, India, China and South Africa, and if you’re struggling to find some overlap between those countries…you’re not alone. With limited economic ties and diverse interests, this group of countries struggles to connect on anything meaningful.

To complicate matters further, BRICS is looking to add some new members to their ranks: Iran, Saudi Arabia, the UAE, Egypt, Ethiopia and Argentina. I urge you to try and come up with a worse list of mid-tier countries to bring on if you want to expand your geopolitical influence.

The varying interests of the current and new members will likely halt any meaningful conversation. The practical significance of this summit and BRICS as a whole is – limited – to say the least. And if you were hoping this would shake up the global landscape, I’m sorry to burst your bubble.

Prefer to read the transcript? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts

Transcript

Hey everyone, Peter Zeihan here. Today we’re going to talk about the BRICS summit. It was originally intended to be a two parter, one during the summit and one after. But because programing got shot down yesterday. We’re combining this into one. So it seems to a little bit disappointed. That is why. And here we go. Hey, everybody. Peterson coming to you from the shore of Lake, where I have been visited by a whole bunch of goats.

They were very curious anyway. Today we’re going to talk about something that is in progress. And that’s the BRICS summit in South Africa. They’re trying to come up with a series of plans of what to do. They’re trying to consider whether they should let in new members. And odds are that this is just going to be a really stupid summit that’s going to amount to nothing.

But it’s still worth talking about because it’ll give you an idea of the architecture of the international system. And you never know. They might be able to pull something out of the fire. So the reason I have primarily been dismissive of the BRICS since the beginning is because it was never an organization. It was never a grouping that was founded by its members.

It was some finance guy who’s like, Look, we’ve got all this capital because the baby boomers haven’t retired yet. We should put it into bonds. And we’re some big bond markets. Oh, yeah, Brazil, Russia, India and China. That’s it. That’s all it was. And then taken to later, they led in South Africa in a in a fit of pique.

Nothing’s going on here. There’s never been any meaningful deal. They have formed a development bank, but now over 90% of the capital comes from China. And there are reasons for the BRICS to talk with China. It is a significant trading partner, but there’s no reason for them to speak with one another. Brazil, aside from exports to China, doesn’t trade with the rest of them at all.

Same with South Africa, same with Russia. India is a special case, and if there’s one country that doesn’t like China, that would be India. And, you know, every once in a while you’ll hear them talking about forming a global currency or a new alternative currency to challenge the dollar. And then they start talking about details and all falls apart.

So right now, India, China, South Africa and the BRICS own bank are on record saying that they’re not interested in a global currency. The only two countries are left are Russia, who thinks that everyone should use the ruble, of course, and Brazil. How can I qualify? Describe Brazilian foreign policies these days, especially on economic issues, kind of. Lodhi DA.

Not a lot of substance beneath rhetoric anyway. So the purpose of this summit is to bring in dozens of leaders from other countries and see if they can kind find something that they can all agree on. A history suggests the answer will be no and everyone is coming with their own list of grievances and desires. The Russians want everyone to sign up with them and boycott the West until the West agrees to give them their way on Ukraine.

Of course, Russia’s not included in that. Russia is still allowed to talk. The first is still how to to trade with whoever they want. The Chinese are hoping to get enough countries on board that they can then walk into Washington and demand trade concessions. They don’t care about all the other countries. They just want them for themselves. The Indians are there because they are more of a classic nine nonaligned power.

But as the Chinese become more rambunctious, the Indians have become more and more edging towards being in the American camp. So the normal rhetoric that you would expect to see out of the Indians just isn’t there. The South Africans who are hosting are pretending to be neutral in all this and say they don’t have an opinion. The Brazilians are very logical and that’s it.

We’re going to turn around here anyway. Why might this one spark? Why might this still matter? Well, if you look back to the Cold War period when we had the nonaligned movement, that’s what a lot of these countries are from. Not Russia, not China, but a lot of the ones who are now showing out, they saw themselves as not east, not west, not first or Second World, but is something else.

And they try to come together for a common thing called the new international economic order. And the idea was that the West should restructure their trade practices in order to benefit some of their former colonies. It didn’t amount to much at the time. Eventually it became known as the ACP group Africa, Caribbean Pacific, a former colonies of the Europeans who have a degree of preferential trade access when it comes to European markets.

But it never got the restructuring that they really wanted. The reason I’m even less optimistic this time around is because the interests of the groups that are showing up are far more diverse than anything that we had in the early post-colonial era back in the sixties and seventies. So if they do decide, if BRICS does decide to do something, it will probably be about expanding their membership.

And that would be one of the most effective ways that I can think of to make sure that BRICS never achieves anything at all because they don’t agree on any much right now. So this is going to be an unofficial two parter. We’re going to wait to see what comes out of the summit. And then I will let you know what I think about the new roster.

All right. That’s it. Bye. Okay, here’s part two. So BRICS did decide they wanted to expand to involve six members in the six countries they involved. Indicate to me that BRICS has no plans of doing anything useful in the future. Those countries in no particular order are Iran, Saudi Arabia, the United Arab Emirates, Egypt, Ethiopia and Argentina. And I mean, honestly, folks, this is hilarious.

Okay, so let’s start with what the naysayers are going to say about how this does matter and explain why it doesn’t. They’re saying that because of the addition of the three countries in the Persian Gulf region plus Egypt, that this grouping, BRICS, now produces about half to 60% of global oil. And that means the downfall of the dollar, the formation of an alternate currency, the end of the petrodollar, divestment, the United States.

And it’s the end of an era. And, you know, the short version is absolute bullshit. Number one, Saudi Arabia does sell a few loads to China in yuan, and Russia does sell a few loads in yuan or rupees in order to get around sanctions. But the Russian system is kind of by itself. And as Russia follows no one, as with the Saudi Arabians and the Emiratis, that might be a little different.

Well, you got to look at why they’re considering doing anything in non-US dollars. They’re looking for a security guarantor. They’re afraid that the United States is going to leave the region. And if it does, they’re on their own. And since they don’t like to be outside of air conditioning, national defense is something they’re not very good at. So they’re basically open to all potential takers when it comes to not oil sales for sales sake, but as a way of getting into your security planning.

The Saudis have gone with the U.S. dollar for the last several decades, not because it was the global currency, not because they’re part of a caucus group that is basically with the BRICS. And they’re not in any sort of meaningful organization in which the U.S. and Saudi Arabia members, they have a bilateral relationship that was based on security, and that was the reason why they use the U.S. dollar.

That’s the reason why they bought refineries on the U.S. Gulf Coast, because they saw the United States as the country that ultimately would bleed and die for them. And they’re looking for alternatives, not because they want an alternative, but because the U.S. is probably not interested in that role anymore. There are also right now trilateral negotiations going on among the Americans, the Saudis and the Israelis, in which the Saudis are seeking a Japan style security guarantee for themselves.

Now, they’re probably not going to get that. They’re probably going to get a lot of things that they’re after. But the bottom line is that for the Saudis, this has never been about the money. It’s never been about the currency. It’s about who’s going to take a bullet for them. And the Chinese simply lack the capacity to deploy at range in a way that the Saudis would be willing to accept and believe, especially since the primary foe that they’re worried about is none other than Iran, which is how it has been, added the BRICS as well.

That brings us kind of the second problem here. The the BRICS have realized that if you’re going to add a country like Iran, that is how should I say, has some firm opinions about security issues, for example, that it should be in charge of the Middle East. Well, then you have to add anyone else from that region at the same time.

Otherwise, you can never have any of them because the Iranians would do the vetoing. So that’s adding the UAE, Saudi and Iran at the same time. It guarantees that you can expand the organization in the future, but it also guarantees that on all significant issues, you now have members inside the organization that going to be in diametrically opposed positions forever.

So we already know that BRICS can’t have a meaningful energy policy because now you have a number of opposed powers Russia, Iran, Saudi Arabian, UAE, all in at the same time. What a shit show. Okay, next up, Argentina and Ethiopia. Ethiopia brings very little the table. It’s one of the ten poorest countries between per capita terms in the world.

It’s landlocked. It’s one of the handful of countries in the world that is not part of China’s one belt, one road, because even the Chinese like there’s no investment case there. So they added in in order to get a little bit of African flair into the organization. And that’s about it. Argentina is not poor. It has a entitlement complex in which it thinks that everyone should give it money and should never have to give any of the money back.

And the reason they applied for BRIC membership is they’re hoping to get Chinese money. It’s not that the Argentineans are anti-U.S. dollar in any meaningful way. It’s just they’re anti paying back their debts. And so they’re always looking for a new financial access point in order to leech off of it until it goes away as well. So honestly, you know, best of luck with those two because there definitely a drain on the organization and they really don’t bring much to the table.

Okay. Who am I looking to? Oh, yeah, Egypt. Egypt is basically a U.S. satellite state. The U.S. basically pays Egypt and Israel and Jordan, for that matter, to not go to war with one another. So thinking that there’s a security play here from bringing the Egyptians in. No. If anything, it’s a bit of a Trojan horse. It is a large developing country.

I would argue that the reason it got brought in is because of India, which still has a lingering love of the nonaligned movement in which Egypt was a reasonably potent player politically but economically. Strategically, I’m afraid not. All right. Is that everybody? Yeah, that’s everybody. When an organization expands, usually one of two things happens. Either one, you’ve got an overwhelmingly powerful single member that kind of decides how things go.

And that would be the United States and NATO’s, for example. Option number two is you expand it with each member, you bring in differing viewpoints, and eventually it paralyzes the organization from doing really much of anything. And the BRICS is definitely firmly in that category right now. This is really only going to amount to anything in the midterm now if one of two things happens.

Number one, the Chinese pay for everything, and that means subsidizing the existence of the Argentineans, as they believe they should be subsidized, which is a hefty price. And very, very poor countries like Ethiopia. The last time a major power tried to do this, it was the Soviet Union. It was the 1970s, and it broke the bank. So not very likely that the Chinese are going to pay for influence in places that they actually can’t control and don’t really bring them much if they did.

The second option is we could see this very, very rapidly expand to basically become the new nonaligned movement. Of course, it would be different this time because the Chinese very clearly have elements in mind and the Russians very clearly have some goals in mind. And it’s difficult to imagine a lot of the world’s middle and lesser powers following the lead of these two countries.

I mean, yes, a lot of the global south has not been interested in condemning the Russians for what’s going on in Ukraine. That doesn’t mean they want to follow them. And anyone who’s not blind realizes the Chinese has some very clear, very nationalist, very, almost hateful, domineering goals for the Chinese rise. And in that sort of environment, no one wants to be a pawn because all of a sudden the nonaligned movement is going to align with a global pull.

No. So where does that leave us? Well, I think if you look at what really went down at the summit, you get your answer. Chinese President Xi Jinping didn’t even show up to some of the opening ceremonies where he was expected to give a pole speeches. The Chinese don’t see this as a useful vehicle, except rhetorically, and that means you shouldn’t treat it as anything else.

All right. That’s it for me by.

Prigozhin Is Dead…But Who Did It?

Yevgeny Prigozhin, the leader of the Wagner Group, has reportedly died in a plane crash. The question that comes to mind isn’t why this happened (because Prigozhin’s hands were plenty dirty), but who did it?

Putin tops the list of suspects, but he is in no way alone on that list. Between the Russian military-industrial complex, the Ukrainian government, Belarus, and even the Americans, plenty of motivated actors would have liked to see Prigozhin go bye-bye.

At the end of the day, who knows if Prigozhin is dead? Reports coming out of Russia aren’t exactly “trustworthy.” However, if true, Prigozhin’s death would leave a void in Putin’s inner circle that would need to be filled.

Prefer to read the transcript? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts

Transcript

Hey everybody. Peter Zeihan here coming to you from Colorado. I was on my way back from a quick camping trip and found out that Yevgeny Yevgeny Prigozhin, who was the leader of that Wagner group that launched the Sudoku a few weeks ago, was supposedly on a plane that went down in Russia. His death is not a low probability outcome, considering his life choices and the people he surrounded himself with.

But I think it’s worth doing a little bit of reflecting because the the cast of characters who may have wanted him dead and had the ability to kill him is, you know, lengthy. So at the top of the list, of course, is Vladimir Putin, the president of Russia, who relied upon pagos and to do a lot of unseen thievery things over the years, most recently, including a meat grinder assault in Ukraine in the eastern city of Mahmoud, which killed minimum 30,000 Russian soldiers.

Some numbers are suggesting the number may be as high as 100,000. But God knows Russian data war, fog, propaganda. Don’t know anyway. When by launching a coup and publicly insulting the entire military industrial complex of the Russian Federation, obviously Putin felt that he had an ax to grind and somebody he had to snip. So obviously candidate number one, but hardly the only one.

Remember Prokop Prigozhin, the really don’t need to learn how to pronounce that anymore. Do it pagos him also pissed off the military industrial complex which executed this war broadly and competently. And the key thing to remember about the military industrial complex in Russia, there is a military complex and there is an industrial complex and they are not the same thing.

Nothing like it is here in the United States. In Russia, they’re very separate. The industry hard. The part where the weapons are manufactured. A guy by the name of Jim is off who is in the Putin’s inner circle is part of that. But that’s not where all the insults were directed towards the military proper. And the military is not not not part of the coalition that backs Vladimir Putin out of here.

Putin’s coalition is a combination of former intelligence operatives from the then KGB, now FSB, as well as organized crime. And that is yet another potential candidate to want him pagos and dead. Remember, that goes in came to Putin’s attention as a caterer who just happened to have some really obscene things to say about a lot of things that Putin liked.

And eventually that turned into face time with Putin, that turned to the money, that turned into state contracts that eventually created the Wagner military group. So there are no end of people in Putin’s inner circle in the world of organized crime, want this guy dead, either because he screwed them over or he was a stepping stone from them to get more of Putin’s ire, any number of reasons could play.

This is, after all, Russia. But of course, not all of the candidates as suspects, if you will have to be in Russia. The Ukrainians have their own reason to want pagos and dead because a lot of Ukrainians as part of the bargain would siege the polls are probably a little nervous about it because Ferguson and Wagner were supposed to relocate to Belarus after the coup deal was signed and they decided to settle right on the Polish border.

Belarus is another candidate, Lukashenko, who is the president of of Belarus, who’s kind of like the schnauzer of the former Soviet world, is the one who supposedly cut the deal between Putin and and after the coup. And if there’s anything we know about the former Soviet world, it’s that deals don’t hold typically until someone is dead. And so this could have been part of it the whole time.

And let’s not forget people for further abroad. Let’s talk about the Americans. You guys remember the troll factory? Prigozhin is the guy who founded that. He’s the one who was actually involved, bragged. I mean, this is this is not controversial. Russia bragged openly and publicly about interfering in the American presidential election between Hillary Clinton and Donald Trump. So, I mean, there are any number of people here who would love to see a bullet in this guy’s head or in this case, you know, smeared over the landscape in central Russia.

And, of course, this all assumes that the dude is actually dead. Yes. His name was on the manifest. Yes, he was on one of ten people who was on the vessel. But at the time of this recording, which is about 7 p.m. Eastern, they’ve only found eight bodies. So this is Russia, you know, a riddle and an enigma in a mystery and a cheese sandwich.

It’s even if he really is dead, this is still only the beginning of the story because it means that there is now an opening in Putin’s inner circle for another person who can be used to be a little bit of plausible, plausible deniability. Not only was this the guy who was involved in the little green men fiascos in 2014 in the original Crimea war, not only is this the guy who was interfering in U.S. elections, this is also the guy who’s led an operation in a dozen African countries where he’s accused of war crimes.

It’s too important of a role for the Russian state, especially now for the Kremlin to just be empty. Someone will step forward. The question is whether that someone is a friend of Putin or not. And that could be all kinds of fun. All right. By.

F-16 Fighter Jets: Updates to Ukraine’s Defense Strategy

Last week the Ukrainians got the news that the Biden administration issued the thumbs up for the Netherlands and Denmark to send Zelensky some F-16s. But this development is by no means black and white.

The F-16s come with some caveats. They won’t be arriving in time to impact the current counter-offensive, nor will there be enough of them in this first round. They’ll also need lots of logistical infrastructure to support them, so I wouldn’t expect this to impact the war effort until (at least) next year.

The green light on this first round of F-16s implies that the US (and other NATO countries) aren’t too far behind. And as the Russians dig themselves into economic isolation, the previously drawn lines around using long-range weaponry will continue to blur.

Prefer to read the transcript of the video? Click here

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

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Transcript

Hey everybody. Peter Zeihan here coming to you from Colorado. Today’s the 18th of August. And the news is that the Netherlands and Denmark have received approval from the Biden administration to send their F-16 fighter bomber aircraft to Ukraine as part of the defense of works. There’s a lot of things that are packed in here. Let’s start with the most obvious one.

Even if these things start to ship today, they’re not going to be there in sufficient numbers or with the infrastructure to support it in time to have any impact on this fighting season. So the summer counteroffensive that the Ukrainians are fighting in an attempt to break the Russian position in southern Ukraine and Crimea, they’re not going to be able to help with that at all.

There’s more to having the jets than simply having the pilots. You have to have the logistical infrastructure to supply them with fuel, with spare parts, especially with munitions. And they have to be able to do all of the repairs and all of the maintenance within Ukraine proper. Now, we know for certain that the United States has been doing steps to accelerate this process over the last few months.

We know that there have been a number of Ukrainian pilots across the United States and databases system that have been training on the F-16s and getting flight time. But there’s going to be a lot more that it needs to be done in terms of the maintenance side of the equation. Okay. So that’s piece one. This is something that’s going to affect over the winter and then into next year.

Second, the players, the Netherlands and Denmark basically run almost exclusively American equipped forces. So there is no way that this came out of left field. Copenhagen and The Hague undoubtedly have been coordinating with Washington since the beginning on this. And if they’re doing it, you can bet your ass that they’re going to be any number of NATO countries up to and including the United States who are going to be following suit now that the seal has been broken.

It’s just a question of timing. Now, again, this is something that’s going to impact operations over the winter and into next year. Not right now. Third, what’s next? The next big step of what the Ukrainians have on their wish list that they haven’t gotten is longer range weaponry that will allow them to strike deeper into the occupied territories and in their mind, ideally even into Russia proper.

Now, the primary reason why this specific request has been denied so far by all of the Western allies is they don’t want to provoke the Russians to direct fight. But as the Russians move deeper and deeper into isolation and as it becomes becomes possible that this is going to be a broader conflict in economic terms, even if not a military warrants.

That argument has been losing luster in a number of places in the Western world. No one wants to start World War Three, obviously, but it’s pretty obvious who’s doing the raping in the genocide, and that is No. One on the west side of the line. So we are going to see longer range weapon systems. I don’t want to comment on which ones because there’s any number of things that could come into play.

And the argument that they cannot be used within Russia proper is weakening as well. Now it’s a political decision if they decide to remove that structure. But if you look at what’s been happening over the last few weeks, the Ukrainians have been provided with storm shadow missiles by the Brits, and that’s a longer range weapon system, more than capable of striking into Russia proper.

But the Russians have not once used it to do so. At the same time, the Ukrainians developed a number of weapon systems, including drones launched by special forces troops and suicide drones that are maritime in style to directly attack Russian targets within Russia proper. They don’t necessarily need Western tech to take the war to Moscow. And since we’re seeing this blurring of capabilities, the idea that simply because a weapon has a range that could be problematic, that automatically is problematic.

That argument is fading very, very quickly. There’s still going to be a lot of brackets on all of this. This is not going to something that’s going to change overnight. But now that they’re going to be getting NATO’s fighter aircraft that clearly have the capacity, if you put an extended range fuel tank on them to strike Moscow directly.

You got to ask yourself, what else can be pushed across the line at this point? And that’s the discussion that’s going to be happening in Brussels and London and Berlin and Paris and Washington quite aggressively over the next couple of months. And by the time we get to the end of the year, I have no doubt that in addition to longer range missiles, artillery systems and jets, there’ll be a whole phalanx of additional technology going to be handed over in order to help the Ukrainians out.

And for those of you say that this is costing the United States too much. Number one, check your math. With the exception of two Patrick batteries, every single other thing that has been transferred from the United States at this point has been spare parts and decommissioned equipment that we were going to have to pay to dismantle. So in many ways, the Ukraine war has saved us a lot of money.

And second, if you think the money has been stolen, you’re literally just making that up. Call your congressperson because they have every day a full list of every piece of equipment, how it was used, how it was transferred, and how much money to actually cost the United States. And anyone who tells you otherwise is lying to you. All right.

That’s it.

Ukraine War Updates: Talking Strategy and Tactics

Things over in Ukraine are in a bit of a holding period, which makes getting these updates out consistently that much harder…and let’s not forget that most of the data we’re seeing is shaky at best. But here’s what I got for you.

There are a few things of note. Ukraine is sending small waves of special forces across the Dnieper River to wreak havoc on that region. These small attacks have been pretty successful, thanks to the Russians shifting their focus to the east. This change in Russian strategy is an attempt to draw Ukrainian forces and attention away from hot spots like Zaporizhzhia.

The big thing here is that Ukraine doesn’t necessarily have to punch through all of Russia’s defenses. If they can push them back far enough to cut supply lines in the north and south, then Crimea could very well be a lost cause for the Russians. The Ukrainians have proven they are fully capable of consistently hitting a target – a.k.a the Kerch Bridge – so this is a genuine possibility.

Remember that shaky data coming out of Russia, well it doesn’t really make a difference for us. At the end of the day, Russia is completely hollowed out and no longer operates as a normal economy. They’ll never quite recover from this, but that doesn’t mean it’s the end of Russia… it’s just the new status quo.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

Support medshare's ukraine fund
Support medshare's global efforts