Economic Warfare in Siberia

There’s been a series of explosions along one of the main lines of the Trans-Siberian rail network. To fully understand the significance of these attacks, we must look at Russian exports, alternative options, and what maintenance looks like.

These explosions could cause disruptions to Russian exports, specifically those bound for China, but the lack of alternative routes and limited maintenance capabilities could be the nail in the coffin.

Ukrainian officials have claimed responsibility for these attacks – unofficially, of course. Regardless, Russia’s economy could be facing a severe blow if these explosions continue.

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.

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TranscripT

Hey everyone. Peter Zeihan here coming to you from chilly Colorado. The news is that last week, on Tuesday the 20th, I believe, a series of explosions hit a couple of pieces of Russian infrastructure in the Far East in southeastern Siberia. Specifically the Sarah Mosque tunnel, which is part of the Trans Siberian network, specifically the Buckle Aylmer main line were hit.

And then a few hours a day later, details are a little fuzzy. A similar line in the vicinity of the tunnel was also hit, which is serves as the backup for the tunnel, a place that they call the Devil’s Bridge. Some anonymous Ukrainian security officials have claimed responsibility for the attack. I can’t tell you if that is true or not.

What I can say is that we’ve got three things going on here. Exports, options and maintenance. So first, exports. Since the Ukraine war began, the Russians have only found it more and more difficult to get their product to market. The Europeans were the natural market. They were the closest for most oil and gas, even a lot of the minerals.

And so when they decided, for whatever reason to stop buying it, a lot of this stuff ended up in China. And for that, the Koreans Siberian rail system is critical. It provides probably 80% of the cargo capacity for land based stuff. And more stuff is going on lands than ever before. Also, all of these lines of which there are basically five, you’ve got one that’s the least important that kind of goes down into Kazakhstan before going over into emersion, Zhejiang.

That’s the least used and the most Frankenstein, the other for all parts of the Trans Siberian system that does cross over the mountains on the passes into China at different places. But all of them collectively are the only way to get things to China. And they’ve all been running at more than 100% capacity, which, you know, we’ve been kind of waiting for a safety situation to boil up, to knock things off line.

And now it’s been done, at least in part by an attack. And when a blight is being used at more than 2% capacity, that means you can’t just ship it to alternatives, even if you’re willing to turn your train around for off people, can you back up the trains you depot? Anyway, point is that one of the four lines, at least for the moment, is off line completely.

Second options. You’ve got these four lines, one that crosses through Mongolia, two that go into northeastern China and one that goes all the way over to the Russian Far East, where things can be kind of repackaged and put on ships. No one lives in Siberia because they want to. I mean, there’s a reason why this is where all the prison colonies were.

Some of the more stable lines, like the bomb line that was hit, are on permafrost, which is not particularly stable. Something happens to the permafrost. The whole thing just kind of sinks in. And it looks like, at least on one of these attacks, a rail car that was full of fuel was hit. So we’ve seen in other parts of the conflict in Ukraine how that can go bad really, really quickly.

Because of this. There are not a lot of population centers along this entire route. In fact, less than 10% of Russia’s population lives along this line. Everybody else is on the western Russia where it’s, you know, warm. And because of that finding, repair crews in the first place might be really difficult. You’re dealing with a lot of tunnels, a lot of bridges, a lot of canyons, a lot of permafrost, a lot of territory where if there is damage, you don’t just slap down some fresh line and start up.

And a road takes years. When this line was built back in the seventies and eighties, the Russians wouldn’t even allow any foreign observers to see it because it was so shoddily put together and it could only operate reliably over about a third of its length. And this was when the Soviets actually had engineers. post-Soviet Russia really doesn’t. And as we’ve seen with the Kerch Bridge, which connects the Russian mainland to Crimea, you know, that was hit over a year ago now, and it’s still not running at full capacity.

So doing repairs in this area is no minor issue. Of course, getting information out of this area is no minor issue as well. Anyway, third maintenance. The Russian educational system collapsed 35 years ago and so there aren’t a lot of people who are, I would consider to be fully capable of claiming the term engineer. In fact, the younger of them turn mid-sixties this year.

Also, everyone that the Russians have who can repair physical infrastructure is in the Ukraine theater right now because the Ukrainians have been blowing up rail depots and rail lines in bridges and roads and everything for a year and a half now. So there just isn’t a lot left that the Russians can use if all of a sudden they’re getting hit on a very, very exposed, vulnerable place 4000 miles east of Moscow.

If this was the Ukrainians or really if this was anyone who really means the Russians ill will, this is an excellent strategy because the Russians barely have the military capacity to patrol their own lands in western Russia abutting Ukraine, much less 4000 miles. The other direction, 5000 miles, the other direction. This is something that can really hit to the heart of their economic plans in a postwar scenario, because if they can’t get the stuff to the Chinese, the Chinese aren’t going to pay for it.

And there’s really only three other lines now that this stuff could be shipped. And so if this is real, we’re going to find out about it really, really fast because there’s just so many points of exposure and so many failure points throughout this part of the Russian system. It would be an easy way to take down the Russian economy far more effectively than anything we’ve seen with sanctions so far.

All right. That’s it. Stay warm.

The Collapse of Russia’s Navy: The Four Seas Problem

Naval challenges are nothing new for the former Soviets, but the Ukraine War has introduced some added stressors in the Black Sea. Russia’s inability to unify its naval presence across the four major seas in the region is a bad sign for Putin.

Russia’s vast swath of territory makes it a logistical nightmare to float a navy. Between the conflict in the Black Sea and the strategic loss of the Baltic Sea with Sweden and Finland joining NATO, Russia’s logistical nightmare is only getting worse.

With Russia’s economy highly dependent upon maritime shipments, finding a solution should be a top priority; however, any naval projects diverting resources away from the Black Sea could be devastating.

No matter what move the Russians make, limiting maritime power will have substantial economic impacts. Putin has once again backed himself into a corner, and I’m absolutely okay with that.

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
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TranscripT

Hey everybody. Peter Zeihan here coming to you from Colorado, where we just had our first big snowstorm, nine inches and counting today. Considering the weather. I figured it was a great time to talk about what the Russians call the Four Seas problem. Most countries who have navies that are worthy of the name have a relatively limited frontage or it’s insulated from all their land power neighbors, and that allows them to float a navy that can then sail whenever they need it.

In the case of some countries like the United States, we have two big ocean fronts, a big chunk of land in between. And so it was an imperative early in the American Republic, around 1900 to build the Panama Canal so that ships could go back and forth. And you’re buying your two navies into a single one for a mailed fist.

To a degree, the French have to do the same thing, but they can’t do a canal. They have to sail around the Iberian Peninsula. And that means that countries like the United Kingdom or Japan, being island nations, are always going to fairly well on the water. Not only because they don’t have land borders to defend, but it’s easy for them to combine all of their navies into a single force when they need it.

The Russians have never had this option. Russians are obviously heir to the physically the largest country on Earth and largest country in history, but they’re not able to combine their naval forces. So they have four seas, the Pacific, the Arctic, the Baltic and the black. And because of that, other countries that have found themselves fighting with the Russians have often been able to defeat the Russians in the tail, with the Japanese being the quintessential example.

In the years of Soviet war of 1904 1905. The Japanese decided that the Russian territories in China were ones that they wanted. So they sailed over there and smashed the Navy. And the Russians spent the next almost year, six months to a year sailing the rest of their navy from the European theater all the way around Asia until they could get there to try to seek the territories back.

And the Japanese destroyed all that, too. So in two battles less than a year apart, the Russians lost everything because they couldn’t combine their forces into a more capable force. That’s even before you consider the Russians have tended to be a technological laggard on all things naval. We’re seeing some version of the forces problems today. The Ukraine conflict is obviously happening on the shores of the Black Sea.

One of those four bodies of water. And the Russians reinforced the Black Sea fleet in the days and weeks leading up to the war so they’d have more punch. But now that Western weapons have made their way into Ukrainian hands, combined with some very clever garage projects by the Ukrainians, the Ukrainians have been able to sink the majority of the major surface combatants, including the flagship.

And what is left of the Russian navy, if it was going to dock in Crimea, which was originally the Russian naval base, going back to the Crimean or sorry, going back to the Tsarist times. They’re all in range of Ukrainian weapons. And so the Russians have had to basically close down their naval base and their primary shipyards and move everything further east to the other major port they have, which is never a cease, which is doesn’t have the dry docks, doesn’t have the service capability, doesn’t have the ability to build ships.

Other problems are that the Russian activities in Ukraine have prompted Sweden and Finland to join NATO. Now, Sweden and Finland control the majority of the sea frontage on the Baltic Sea with the second largest chunk of territory in the Baltic Sea, controlled by countries that were already in Naito. And so now that Finland is in and Sweden is going to be in in a matter of weeks, the Russians will basically have this tiny little chunk of territory in a place called Kaliningrad, and the frontage sits in the general vicinity of Saint Petersburg and that’s it.

So less than 5% of the frontage. And in order to get out to the open sea, they have to sail by a sea. One, two, three, four, five, six, seven, eight, nine. And let’s call it nine neutral countries. And then you’re in the North Sea, which is also NATO like. So basically everything that’s in the Baltic Sea now is written off.

It’s a loss and that just leaves the fleets that are in the Arctic Ocean, which have been depleted because they sent ships onto the Black Sea and then off in the Pacific, which are worse off by themselves. So no matter how the Ukraine war goes at this point, Russia has functionally ceased to be a naval power at all.

The question is whether ego will allow them to accept that fact. And honestly, the more money that the Russians throw at naval projects that they’re not very good at in order to base them at bases that they can’t defend and that can’t reinforce one another, I think the better because every ruble that they use for that is a ruble that is not being used to build a tank or kill a Ukrainian.

So, you know, I say bring it on anyway. What this means is we’re looking at this entire space, seeing a change in military statistics and military strategy because the Russians today are one of the countries on the planet that is most dependent upon naval shipments for their economy. Russian industry is not all that. And they depend upon those oceans for getting their oil and their liquefied natural gas and their aluminum and on and on and on to market.

And they’ve now found themselves in a position where they are utterly incapable of projecting power on the seas in a local basis, much less a regional or national one. And so, yes, when the United States and Europe decide that it’s time to really shut down the Russian economy, they’re going to be able to do it at sea with ease in a matter of days.

So we’re only in the early stages of this war, not simply from a military point of view, but from an economic point of view, too. And it’s time to start preparing for what comes next. And that is a world without any Russian commodity exports starting to get cold. Okay. I think I think that’s it for me. See you guys next time.

New Tactics in the Ukraine War & MedShare Donations

Thank you to everyone who has already contributed to MedShare International over the past week!

We have some exciting news to share today. In addition to our donation match of $40,000 – one of our subscribers has graciously decided to match our donation. That’s a potential $80,000 going to MedShare and Ukraine.

So if you haven’t donated already, we encourage you to click the link below and help us (and our other gracious donor) hit our match goals.

CLICK TO DONATE TO MEDSHARE'S UKRAINE FUND

From 30,000 feet, the pace of the Ukraine War appears to be slowing and even reaching a stalemate; however, when we zoom in on places like the Dnieper River and Mariupol, we can see the new tactics and strategies being implemented on both sides.

The Ukrainians are beginning to use smaller waves of units to push across the Dnieper and hold ground along the riverbank. If this continues and they can successfully move south, there’s a chance that they can cut off supply routes and stir up some problems for the Russians.

Of course, the Russians aren’t sitting idle. Between sending more troops through the meat grinder and layering the region with mines, the Russians have been able to prevent any major breakthroughs for the Ukrainians.

There is plenty happening behind the scenes.

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. Peters Zeihan here coming to you from a home office in Colorado. I haven’t done a Ukraine update in a while because there’s been a lot of cross-currents. The front hasn’t moved very much. And in most people’s minds, that means a stalemate. And there’s definitely some truth to that. We’ll get into that a little bit, but there’s been a lot of change in tactics on both sides.

This is the first year that the Ukrainians have brought tanks into the fray and tried to do combined arms. However, the American style combined arms, the NATO’s style also includes air power and at least air parity. And the Ukrainians have nothing like that. So they’ve discovered that sending in lots of armor without air cover is, well, is going for them as well as you would expect it would.

So they’ve kind of devolved back to some older strategy that we’re using in the first part of the war. We’re using a lot more small units and that means the pace of activity has been necessarily slower. They have achieved a number of points of breakthrough in the first, second, and sometimes even the third line of Russian defense. But the Russians have been through and able to put up more and more and more mines to slow the Ukrainians.

So they’ve never actually been able to achieve any sort of breakthrough. So we’ve had a lot of incremental changes in the front, but nothing like the big breakthroughs in places like ISM or Kherson like we saw last year. For their part, the Russians have been innovating their strategies as well. Maybe innovating this the wrong word. They’ve done this silent call up of a couple hundred thousand more troops and just threw them right into the meat grinder and a place called Ivica.

Sorry for the pronunciation there, which is not too far from other places that the Russians were basically doing human wave tactics last year. And they’re having very similar results, very, very, very slow going, dating meters a day at the cost of thousands of lives. But in the last two weeks, the Ukrainians seem to be trying something new. And it would normally be something that I would just say is suicidal.

But let me give you an idea of what they’re doing and then maybe you can choose for yourself. So let’s do a foreign screen share. Go to Google Earth because it’s awesome. All right. We’re looking here at southern Ukraine, and this is an oversimplification, but if you zoom in just a little bit, this river here, this is the Dnieper.

It’s basically the front line for a large portion. Basically, everything south of this line is now in Russian hands and everything. The north line is in Ukrainian hands. And for those of you who remember too, earlier in the year, the Russians thought that the Ukrainians were to be pushing across the river. They blew up all the bridges and especially this dam right here, which is the Nova Kharkov Dam.

And what that meant is the entire upstream reservoir, which is one of the world’s largest, drained over the course of just a few days and flooded everything to the south of this point. So this whole area became flooded. You can call that a war crime. You can call that deliberate destruction, call that whatever you can call it, Max, call whatever you want.

But what it did do is turn this entire Southern section and be kind of a no go zone for most vehicles because you had exposed Riverbank above here, which was muddy or late at I guess it was about. And then down here you had flooded Riverbank that was muddy. So the Ukrainians would wanted to hit the Russians in two or three different places, suddenly found this entire swath became non-viable.

Well, what we’ve seen in the last couple of weeks is the Ukrainians have been probing across this river in worse and actually holding ground, not just using small units, but larger groups, troops. It’s unclear just how many, but the point is they haven’t been going over at night making things up and then running back before dawn. They’ve been going in a it is seen there for days and the Russians have seemed to be incapable of dislodging them.

And my first thought that this is just suicidal because if if you’re Ukrainian and you don’t have a bridge that you can retreat across any time that the Russians are able to bring any sort of artillery or even just infantry to bear on your position, there’s nowhere to go. Your backs against the river, you’re just going to die.

That’s not what’s been happening because further to the east, the Russians have been throwing human waves at a very specific location that adeyinka again, again, apologies for the pronunciation, and that’s all of the available troops in the area. The Russians are hitting that spot to prevent the Ukrainians from having a breakthrough further east in Japanese province. And what that means is it’s been difficult for the Russians to get reinforcements and materiel and just fuel into this zone right here.

So let me zoom in a little bit more. You can see how the geography is working against the Russians and for the Ukrainians in this point. You’ve got these sand dunes area, the nature park, where there’s no infrastructure at all. And then you’ve got clusters of Russians over here at this junction point of the transport system and at this junction void of the transport system.

And so what the Ukrainians have done is land all the way across the river throughout here to keep these two groups engaged. And then they’ve used their artillery from the other side of the river to just decimate the parts that are in here. Basically making this a no go zone for the Russians, which has allowed the Ukrainians to build up a bit of a bridgehead isn’t quite the right word because there’s no bridge.

But you get the idea. Any forces that are over here in the east, any Russian forces that are over here in the east, are under pressure because of that massive battle further east. And it’s difficult for the Russians to get anything through that zone to then resupply their troops further to the west. And then the groups that are here on the west side of the sand dunes get their supplies through Crimea.

But the Kerch Bridge has lost both a thrill connections and a half of its road connections. So the Ukrainians are able to play fast and loose in this area and they’re increasingly poking left and right, west and east, especially to the east, because if they can dislodge the Russians here or simply enter into a bit of a war of a move moment, then this entire zone over here, that which is occupied territory becomes in play.

For those of you who’ve been following the war since the beginning, the silly city of Mariupol is right over here, and Mariupol can really only be supplied by road now. And the places where the Russians are and Ukrainians are attempting to basically have a mutual break through of each other’s lines were around it here. So all of the Russian forces are going into this zone, leaving this entire southern swath potentially with very limited supplies.

And so if the Ukrainians can break the connection here, then these little connections that are all that allow stuff to go from Crimea north, all of a sudden are pinched off and you could have theoretically a bit of a breakthrough. Now, there are a lot of moving pieces on this. I’m not suggesting this is where we’re going, but this is the sort of tactic that you normally wouldn’t expect to see.

And we’ve now been seen it for about two weeks. So it’s something to keep your eye on as more things develop, of course, get back to you. But that’s where we are today.

Russia Backs Away From Nuclear Test Ban Treaty

If you were hoping to start your week off with some cheery news – it might be best to skip this video. Russia has stepped away from the Comprehensive Test Ban Treaty, so we have plenty to discuss today.

My initial concerns aren’t about a return to nuclear testing but rather a much darker scenario – that control of Russia’s nuclear arsenal may be compromised. We’ve already seen failures and cracks throughout the Russian military, but have those vulnerabilities made it to the nuclear program?

If Putin hits the shiny red button and nukes take off, we know how that ends..but what happens if Putin hits that button and nothing happens? I’d prefer to keep that can of worms shut, but we’re nearing a reality where that might not be possible.

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 the California coast. And it is the 2nd of November. And the big news today is the Russians have withdrawn from something called the comprehensive test ban Treaty, which aims to ban all tests in all forms of all sorts, all types of nuclear weapons. It’s a little bit different from most of the arms control agreements that exist in the world.

Most of the effective ones are bilateral treaties between the United States and the Soviets, plus Russians that have dealt with nuclear ceilings and the numbers of weapons and their stationing and their dispositions, and sometimes even down to conventional weapons. And most of this proliferation excuse me, most of this none proliferation regime is in danger right now because the Russians have stopped enforcing or have simply pulled out of treaty after treaty, prompting the Americans to follow suit.

The city. But never entered into force, however, because it was a multilateral effort, unlike all of the Cold War treaties where Moscow and Washington sat down across a table from another to hash out the details, sometimes with London or Beijing or Paris in tow. The city beat was always a multilateral effort that involved over 100 countries. And so when it was first adopted by the U.N. General Assembly back in the nineties, the hope was that we had entered into a fundamentally new era where everyone would agree that nuclear war is perhaps not something we should aim for because it came from the UNGA, because it wasn’t negotiated primarily by the nuclear powers.

The nuclear powers, for the most part, have not abided by it. It’s not that there’s been a huge amount of testing, but all the other powers have decided to. What’s the most polite way to say this? Pretend the treaty doesn’t exist. So countries like the United States and China have signed it. Same with India and Pakistan. But they never ratified it.

The Brits and the French have signed and ratified, but with a couple of exemptions in there. And now the Russians have basically joined the Americans and the Chinese and the Indians and the Israelis and everything, and basically saying that we’re not going to buy this by this at all. Now, it doesn’t mean that a return to nuclear testing is imminent.

In fact, there’s an open question of whether or not the Russians can even do a quality nuclear test any more longer. They’ve had a number of instances in the last three years where they’ve tested some of their ballistic missiles and they’ve discovered that a lot of them just don’t work anymore. And remember that if you’re going to test something that the world can see, you’re going to b, b that piece of hardware because you don’t want to look like a fool if it doesn’t work.

And the Russians on multiple occasions have looked like fools when it doesn’t work. So the real risk here isn’t so much that the Russians are going to test. The risk is whether or not their command and control over the nuclear arsenal is actually intact, because we have seen that the Defense Minister Shoigu has basically, even in the height of the war in Ukraine, continued to steal from the military hand over fist.

And you hope you hope that he’s not stealing a particularly interesting components from, say, the nuclear program, but the guy really has no ethics and no sense of patriotism. So you really can’t rule that out. The nightmare scenario for me remains is what happens if Putin hits the big candy like red button and nothing happens. And we now have seen on multiple occasions that American intelligence has penetrated so far into Moscow that we’re basically not even knowing what Putin has for lunch before he even wakes up in the morning.

And in that sort of a mire, what do you do when somebody tries to kill half a billion people but fails?

The Ukraine War and MedShare Donation Match

We’ve been talking about the Ukraine War for quite a while now, but I still get questions asking why. So, we’re looking at the historical significance of this region and what this conflict means for all of us.

Before we dive in, I’m pleased to announce our donation matching drive for the month of November. We will be matching up to $40,000 in donations this month to our chosen charity partner, MedShare International.

MedShare is a non-profit humanitarian organization committed to delivering life-saving medical supplies to areas in need around the world. We have been particularly proud to support their mission of supplying medical supplies and equipment to care for the victims of the ongoing conflict in Ukraine. Your donations help deliver surgical kits, life-saving equipment and other urgently needed medical supplies – and in November, your impact will be doubled through our matching donation.

Please click the link below to donate, and all of us at Zeihan on Geopolitics, thank you for your generosity.

Support medshare's ukraine fund
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Russia’s invasion of Ukraine is not an isolated incident; the Russians have been carrying out similar attacks to secure their borders for decades now. So if Russia isn’t stopped in Ukraine, they will continue until all of those critical access points are taken.

As long as Russia is committing war crimes, targeting food and agriculture infrastructure, and attacking the power grid, we must support Ukraine. So, I urge you once again to support MedShare and donate at the link below.

Russia Might Lose Its Influence in Moldova and Transnistria

If you’re keen on finding a place that has been put through the rinse cycle by the Russians more than a few times, look no further than Moldova. Today, we’ll explore the Russian de facto state in the eastern sliver of Moldova, known as Transnistria.

This region operates as a smuggling hub and carries heavy influence in the broader political landscape of Moldova. But as the war in Ukraine rages on, Moldovians are setting their sights on a future that removes Russia as their puppet master.

If Ukraine can hold out, the Russians will lose air and land access to Transnistria – meaning Russian support for this region would become impossible. Anticipating this shift, Moldova is aligning itself with Europe and entertaining a reunification with Romania.

With EU involvement on the line, the future of Moldova (and that tiny sliver in the east) could be resting on the decisions and results of the Ukraine War.

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 where it’s rapidly turning into autumn. And today we’re into the third part of our kind of open ended series on the Russian footprints in the former Soviet Union, places where the Russians have managed to establish military control and kept history from moving forward in order to preserve their own geopolitical power.

And today we’re talking about an area called Transnistria, which is in the former Soviet state of Moldova, which is a tiny sliver of territory on the extreme southwestern fringe of the former Soviet space. You probably have heard of it, but if you’re American but if you’re European, you’re probably fairly aware, especially if you’re Turkish. Moldova is a chunk of territory that once was known as Bessarabia, and it sits in an area known as the best Arabian Gap, which is one of the few points where there’s sure there’s physical access to the former Soviet Union from another geographic zone.

A lot of the Eurasian steppe is, well, the region steppe itself, it’s flat and open. But there are a number of places where there are access points to go to other zones. So the I’ll take out takes you into some of the Chinese space. The Polish gap takes you into Western Europe, the Bessarabia and gap takes you down into Turkey in the Middle East.

And so it’s one of the zones that the Russians have always been incredibly concerned about because they’ve been invaded through that route on a number of occasions. So they took steps through a number of wars culminated in World War Two to try to establish a foothold in that zone so they could plug the gap. And they ultimately succeeded in the world wars and they carved it up into the territory that is now known as Moldova.

Now, Moldova, in the most recent previous incarnation, was actually part of the Romanian state. And the people in Moldova speak basically Romanian and right Romanian. The Soviets basically invented a language called Moldova, which is subtly different but is broadly understood on both sides of the border. Now, Transnistria is a thin sliver of the eastern part of Moldova. When Moldova got its independence from the Soviet system in 1992, the Russians immediately sponsored a secessionist war there in Transnistria, was able to break away with the help of regular Russian forces, and they’ve maintained a force of 1 to 2000 Russian peacekeepers other since the peacekeepers do nothing of the sort.

They have really nothing to do with security, although they’re basically there to run a smuggling state. And it is one of the most active smuggling locations in all of Eurasia, which, if you’re familiar with places like Afghanistan, that is a strong statement. They also manipulate the political system in Moldova pretty aggressively. There is a significant plurality of people in Moldova who would prefer to go back to the Soviet times because post-Soviet Moldova has been an economic basket case.

They really don’t make much except for a kind of low grade, super sweet wine some people care for not me, and they are a smuggling state as well. And probably a fifth of the female population is left for the sex trade and another fifth of the population has just left in general. So this is an area that now is, I think, two under 4 million people.

And it’s just kind of they are sandwiched between one of the EU’s poorer members and Ukraine. The problem the Russians are going to have here, though, is if Ukraine is even moderately successful in its in this war, the Russians have no footprint. They rely on air space access from the Ukrainians to access their military facilities in Transnistria. And Transnistria is on as the name sounds, on the opposite side of the East River from the rest of Moldova.

So it relies on access to all of Ukraine for things like food and fuel. So when this war started and it looked like it was all going to fall apart for the Ukrainians really quick, I did a video which will attach here about how trans this was a likely target for the Russians because they could link up with forces that were already there.

Now it looks very much like it’s going to be the opposite, that this area is completely cut off and the Moldovans are starting to make some bets on that point. And they’ve moved much closer to the European since the war began and they’ve even kind of repudiated that Moldovan language that the Soviets fostered upon them. And now there’s open talk across the political spectrum in Moldova about reunification with Romania.

If that were to happen, they would step in to the EU overnight and avoid a lot of the problems politically, economically and developmentally that some of these other former Soviet states, like the Ukrainians are having in qualifying for EU membership. So this is one of those that all it takes is the right battlefield evolution in Ukraine and this footprint goes away in a day.

That still leaves the issue of clearing out Transnistria. But as we’ve seen in Nagorno-Karabakh and the Armenian situation, when the Russians are unable to provide security assistance like now, it doesn’t take very much to move the needle. And I can easily see a situation where the Moldovans would apply to formally jwn Romania and this becomes Romania’s problem and the EU’s problem.

And since it’s a sliver of only 120,000 people and it’s hard up against Ukraine that all of a sudden would have the EU taking security steps, which is something that would be new and exciting. Okay. Oh yeah. And Romania may top member, too, so that would flip pretty much overnight. All right. That’s it for this one. Take care.

Russian Oil Thrives Despite European Sanctions

While sanctions on Russian natural gas have proven highly effective, those imposed upon Russian oil have somewhat backfired. Although oil exports have dropped by 10%, several factors have skyrocketed Russia’s earning potential.

Oil is much easier to transport than natural gas, so getting it to destinations is of less concern. There’s also a global shortage of heavy sour crude – the kind that comes from Russia’s Urals – which has driven up prices significantly. Europe’s sanction strategy targeted financing and insurance, but Russia has circumvented these restrictions via state-sponsored insurance programs and old tanker purchases.

Thanks to Europe’s phased implementation of sanctions, the Russians had ample time to find loopholes and undermine this system. The Europeans may have to come up with some more “direct” tactics to put the hurt on the Russians.

This situation remains unpredictable; we could see Ukrainian strikes on Russian ports or even some insurance claims will stir the pot. But If oil sanctions were as effective as the sanctions on natural gas, the dynamics of this war would be fundamentally changed.

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. Now, yesterday, we talked about how some of the European sanctions on the Russian energy industry were working much better than expected. So now let’s kind of flip that and talk about some that are not doing nearly as well. That has to do with oil, whereas with natural gas, Russian exports to Europe are down by 85% and Russian production is now the lowest in 40 years.

Oil has dropped off a little bit, about 10%, but the Russian ability to profit from it has skyrocketed senior earning significantly more now than it did before the war. And it’s worth explaining why in the sanctions are out of the reason why the Russians are doing so well in that field. So there’s three things to keep in mind when you’re talking about oil markets.

Number one is the physicality of things. Natural gas is a gas. It’s hard to move from place to place. And you pretty much have to have a dedicated piece of physical infrastructure, typically pipeline, to get it from A to B. You can’t chill it down in a liquefied form, roughly negative three degrees, and move it via specialized tankers that unload in specialized facilities.

But those things are so specialized, they’re not really they don’t allow for a really liquid market. Oil’s different. Oil is a liquid and it is a liquid at room temperature. So you can put it into pretty much any type of container shipping device that you want. And while the Europeans did, for the most part, stop taking oil from the Russians in perfect form, the Russians are able to export over half of their oil by water to be a tanker.

And they were even able to redirect some of the piped crude to their ports. Which brings us to the chemistry problem. Not all crude is the same. In the world of natural gas. Methane is methane is methane in the world of oil. There’s different varieties, light and sweet versus heavy and sour. Light and sweet has very few contaminants and it is very thin, almost clear where the heavy sour is thick and gooey might even be solid at room temperature and is black and viscous.

And different refineries around the world are designed to run on different grades of crude, sometimes even specific crude types from specific fields. And that makes it a little bit more of a mismatch problem that natural gas just doesn’t have to deal with. So, for example, in the markets right now, there is an oversupply of light sweet on a global scale, primarily because of the United States.

U.S. shale crude is different from most crude in that it’s trapped at the moment of geological formation. And so it never migrates through the rock strata. And it’s the migration that picks up the contaminants that makes crude heavier and more sour. Well, American refineries are designed to run on heavier and sour, so that light sweet is kind of stranded in North America.

So it has to be exported by tanker to the wider world. And so light sweet crude is trading at a significant discount to a lot of global crude grades, despite the fact that it’s considered high quality. On the flip side, we’re running out of heavy sour. Venezuela used to be a massive producer, and it’s found ever more creative ways to commit national suicide.

The Mexicans used to be a reasonably large supplier, and they’re keeping their crude at home because their economic development has demanded more energy. And the world’s single largest crude grade of all is none other than Russia’s Urals blend, which is a medium sour, medium heavy blend. And so taking even small amounts of that off the market has had an outsized impact on pricing.

And so even though there’s supposedly a price cap that the Europeans set at $60 a barrel, that anything above that the Russians shouldn’t be able to sell it. Right now, Russian Urals is going for 85. And there’s not much the market can do about it. Which brings us to the third point, which is the legalities and the niceties.

When the Europeans stop taking the piped oil and started to slim down, they’re taking of the tanker, shipped oil from Russia. They used their ability to influence global financing, global insurance, specifically saying that anyone who delivered or participated in the supply chain that took Russian crude and if it was sold above $60, they wouldn’t be able to qualify for any European based insurance or financing, trade, finance included.

And since that is the source of the vast, vast, vast majority of the world’s maritime shipping insurance, the thinking was that that is going to discourage anyone from doing it. Well, they also didn’t want to destroy their own economies when they were doing this. So they phased all this in over the course of the year. And it turns out that that was enough time for everybody who was interested to set up alternative systems.

So India, China and Russia now all offer state sponsored insurance programs for maritime shipping. And the Chinese and the Russians in particular, have gone out and purchased huge numbers of really, really old, decrepit tankers and are running them kind of under the radar, turning off the transponders so they can’t be tracked easily. And those two things together has allowed a huge amount of Russian crude to sail the world’s oceans without any even tangential connection to the European financiers that it was thought would be able to keep all of this stuff off the market altogether.

The very act of providing the market with time to adjust gave the market time to adjust for all players. And so the stuff is still coming out now. If the Europeans and to a wider degree, the West in general is going to take an ax to Russian crude, they’re going to have to get a lot more creative or they’re going to have to act a lot more directly.

Keep in mind that roughly 1 million and a half of barrels of crude every day Russian crude are flowing out of the port of Morse on the Baltic Sea and another million and a half on the port of overseas on the Black Sea. And as long as the Europeans are not willing to take direct action against that, and they definitely have the military capacity to do so, should they so choose this seems like it’s going to keep flowing.

About the only potential fly in the ointment there is on the Black Sea, and that the Ukrainians have now said that they are willing to attack targets in Russian ports. Now, since they made that threat about five weeks ago, now they haven’t acted on that threat, even though their supposed deadline now has expired three weeks in the past.

But it’s probably going to take some sort of military action by someone to remove this from the market or one other possibility, as we have some sort of mishap where those insurance claims get called upon and the Indians and the Chinese and the Russians who have never offered these insurance plans before now will probably find themselves in arbitration almost immediately when they try not to pay.

But that’s a series of if then statements that are impossible to predict at the current moment. Honestly, I’m a little surprised it hasn’t happened by now, considering everything that’s gone down in the Ukraine work. But that is where we are. So Europeans natural gas working better than expected will not working nearly as well as expected.

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…

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. 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.

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 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.

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 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.