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Putin Responds To US, European Sanctions: Signs Order Recognizing Crimea As Sovereign State | Zero Hedge

Putin Responds To US, European Sanctions: Signs Order Recognizing Crimea As Sovereign State | Zero Hedge.

So much for de-escalating:

  • RUSSIAN PRESIDENT VLADIMIR PUTIN SIGNS ORDER ON RECOGNITION OF CRIMEA AS SOVEREIGN STATE – RIA

Surely to precede Putin’s own executive order recognizing Crimea as the latest member of the Russian Federation. And as for those “crippling” sanctions, via the FT, here is the locals reall think and why the Russian stock market is soaring as we reported earlier.

Moscow investment banker on US sanctions: “It’s as innocuous as we’d hoped”

— Courtney Weaver (@courtneymoscow) March 17, 2014

One also wonders: how long until Russia freezes all assets of McDonalds restaurants operating in Russia.

Next Steps in the Ukraine Crisis | Jeffrey Sachs

Next Steps in the Ukraine Crisis | Jeffrey Sachs.

There is a stark and obvious asymmetry in the Ukraine crisis. Russia will use military force to get its way. The West will not and should not. There is no doubt that Russian militarized bullying can lead to the de facto division of Ukraine, an event that would be of grave long-term consequences not only for Russia and Ukraine but for the world. The practical question at hand is whether international law can still function to stop this from occurring. In my view, the answer is yes.

The problem with international law is that the great powers, including both the US and Russia, give it allegiance opportunistically, only when it is to their short-term convenience. The US launched the Iraq War against international law. The US has recently destabilized many regimes against international law that protect the sovereignty of UN member states. The US is supporting a violent insurgency in Syria to bring down the regime against international law.

Now it is Russia’s turn to violate international law. Russia’s actions in the Crimea are perfectly intelligible in terms of Russia’s interests and foreign policy traditions, but they are also clearly in violation of international law. Russia has high stakes in Ukraine, and the extra-constitutional toppling of Yanukovich was against Russian interests and provoked Russia’s response in Crimea. The West should acknowledge Russia’s valid economic and security concerns in Ukraine, but it should not accede to Russia’s unilateral and illegal actions in Crimea (and still less if they spread to Eastern Ukraine).

The most important governing law in this immediate case is both explicit and extremely important. It is the treaty-backed agreement reached by four powers in 1994, Ukraine, Russia, the United States, and the United Kingdom, known as “The Memorandum on Security Assurances in connection with Ukraine’s accession to the Treaty on the Non-Proliferation on Nuclear Weapons (NPT).” It is filed with the UN Security Council as S/1994/1399, on December 19, 1994.

The issue at hand in 1994 was as important as any issue of international law: the management of nuclear arms. Ukraine and Russia had just recently become independent after the demise of the Soviet Union in December 1991. Ukraine had inherited a nuclear arms stockpile. In the interest of nuclear non-proliferation and to prevent accidents, terrorism, or a nuclear showdown in the post-Soviet region, the US and Russia prevailed on Ukraine to give up its nuclear weapons and hand them to Russia.

The quid pro quo, at stake today, was Ukraine’s territorial sovereignty. Ukraine gave up its nuclear weapons on the assurance that it would remain sovereign and secure, including from Russia. As Ukraine renounced nuclear weapons and joined the NPT, Russia, the US, and UK, “reaffirmed their commitment … to respect the independence and sovereignty and the existing borders of Ukraine.” Moreover, the parties reaffirmed:

their obligation to refrain from the threat or use of force against the territorial integrity or political independence of Ukraine, and that none of their weapons will ever be used against Ukraine except in self-defense or otherwise in accordance with the Charter of the United Nations;

As for threats of energy cutoffs or other economic sanctions, the parties reaffirmed:

to refrain from economic coercion designed to subordinate to their own interest the exercise by Ukraine of the rights inherent in its sovereignty and thus to secure advantages of any kind;

Crucially, the memorandum made clear that the four parties (including Ukraine) would “consult in the event a situation arises that raises a question concerning these commitments.”

This international agreement is the basis for Russia to return to its base in Crimea, and for Crimea to remain part of Ukraine. It is the guarantee of Ukraine’s territorial integrity and sovereignty. It is the bulwark against economic blackmail. In short, it is the place where peaceful nations must take their stand in the current crisis.

The United States should make the legal case, again and again, in the UN Security Council. It should explain the global agreements in detail to the American people, the UN member states, and the world. It should require that Russia explain its actions in light of its clear responsibilities to consult with Ukraine, not as a matter of good neighborliness, but as a matter of solemn international obligation.

There are three weaknesses in this approach. First, international law works slowly, while armaments and events move quickly. No doubt that is true. Second, and just as important, the US is a frequent violator of international law. Invoking it is a double-edged sword: Many US initiatives will be called into question (e.g. in Syria). Third, Russia is not especially lawyerly in its foreign policy. Yet its record of abiding by international treaties is actually much stronger than is widely known.

The West acted foolishly in Ukraine, thinking that a popular upheaval could sweep a pro-Russian government from power and yet not prompt a hostile Russian reaction. The EU was naïve in thinking it could spring Ukraine from Russian influence through a mere association agreement or a loan. Any government in Ukraine must pay attention to the security and economic interests of its powerful neighbor to the East. The West should not feed fantasies held by segments of Ukrainian society.

Yet the West should not accede to Russian demands. Upholding Ukraine’s sovereignty is not just about Ukraine. It is about the non-proliferation treaty itself, and global safety in a nuclear-armed world.

Yet there can be no military response from the West. Analogies to Munich 1938 are not correct. In a nuclear world, Russia will not invade the West nor can the West triumph militarily over Russia.

Similarly, sanctions will not play any real role except dig both sides deeper into confrontation. Visa restrictions are less than pin pricks, signs of silliness not policy. The UN Security Council should insist on reason from Russia, and West should insist on reason and moderation from Kiev.

All sides will lose in a deepening confrontation and horrible mistakes would be possible. Russia’s security interests should be respected, but Russia should abide by international law, and the US should do so in Syria and other areas of Russian concern. For the entire world, international law is the key to long-term survival. It may be a slender thread, but it is the only thread we have.

Follow Jeffrey Sachs on Twitter: www.twitter.com/JeffDSachs

Next Steps in the Ukraine Crisis | Jeffrey Sachs

Next Steps in the Ukraine Crisis | Jeffrey Sachs.

There is a stark and obvious asymmetry in the Ukraine crisis. Russia will use military force to get its way. The West will not and should not. There is no doubt that Russian militarized bullying can lead to the de facto division of Ukraine, an event that would be of grave long-term consequences not only for Russia and Ukraine but for the world. The practical question at hand is whether international law can still function to stop this from occurring. In my view, the answer is yes.

The problem with international law is that the great powers, including both the US and Russia, give it allegiance opportunistically, only when it is to their short-term convenience. The US launched the Iraq War against international law. The US has recently destabilized many regimes against international law that protect the sovereignty of UN member states. The US is supporting a violent insurgency in Syria to bring down the regime against international law.

Now it is Russia’s turn to violate international law. Russia’s actions in the Crimea are perfectly intelligible in terms of Russia’s interests and foreign policy traditions, but they are also clearly in violation of international law. Russia has high stakes in Ukraine, and the extra-constitutional toppling of Yanukovich was against Russian interests and provoked Russia’s response in Crimea. The West should acknowledge Russia’s valid economic and security concerns in Ukraine, but it should not accede to Russia’s unilateral and illegal actions in Crimea (and still less if they spread to Eastern Ukraine).

The most important governing law in this immediate case is both explicit and extremely important. It is the treaty-backed agreement reached by four powers in 1994, Ukraine, Russia, the United States, and the United Kingdom, known as “The Memorandum on Security Assurances in connection with Ukraine’s accession to the Treaty on the Non-Proliferation on Nuclear Weapons (NPT).” It is filed with the UN Security Council as S/1994/1399, on December 19, 1994.

The issue at hand in 1994 was as important as any issue of international law: the management of nuclear arms. Ukraine and Russia had just recently become independent after the demise of the Soviet Union in December 1991. Ukraine had inherited a nuclear arms stockpile. In the interest of nuclear non-proliferation and to prevent accidents, terrorism, or a nuclear showdown in the post-Soviet region, the US and Russia prevailed on Ukraine to give up its nuclear weapons and hand them to Russia.

The quid pro quo, at stake today, was Ukraine’s territorial sovereignty. Ukraine gave up its nuclear weapons on the assurance that it would remain sovereign and secure, including from Russia. As Ukraine renounced nuclear weapons and joined the NPT, Russia, the US, and UK, “reaffirmed their commitment … to respect the independence and sovereignty and the existing borders of Ukraine.” Moreover, the parties reaffirmed:

their obligation to refrain from the threat or use of force against the territorial integrity or political independence of Ukraine, and that none of their weapons will ever be used against Ukraine except in self-defense or otherwise in accordance with the Charter of the United Nations;

As for threats of energy cutoffs or other economic sanctions, the parties reaffirmed:

to refrain from economic coercion designed to subordinate to their own interest the exercise by Ukraine of the rights inherent in its sovereignty and thus to secure advantages of any kind;

Crucially, the memorandum made clear that the four parties (including Ukraine) would “consult in the event a situation arises that raises a question concerning these commitments.”

This international agreement is the basis for Russia to return to its base in Crimea, and for Crimea to remain part of Ukraine. It is the guarantee of Ukraine’s territorial integrity and sovereignty. It is the bulwark against economic blackmail. In short, it is the place where peaceful nations must take their stand in the current crisis.

The United States should make the legal case, again and again, in the UN Security Council. It should explain the global agreements in detail to the American people, the UN member states, and the world. It should require that Russia explain its actions in light of its clear responsibilities to consult with Ukraine, not as a matter of good neighborliness, but as a matter of solemn international obligation.

There are three weaknesses in this approach. First, international law works slowly, while armaments and events move quickly. No doubt that is true. Second, and just as important, the US is a frequent violator of international law. Invoking it is a double-edged sword: Many US initiatives will be called into question (e.g. in Syria). Third, Russia is not especially lawyerly in its foreign policy. Yet its record of abiding by international treaties is actually much stronger than is widely known.

The West acted foolishly in Ukraine, thinking that a popular upheaval could sweep a pro-Russian government from power and yet not prompt a hostile Russian reaction. The EU was naïve in thinking it could spring Ukraine from Russian influence through a mere association agreement or a loan. Any government in Ukraine must pay attention to the security and economic interests of its powerful neighbor to the East. The West should not feed fantasies held by segments of Ukrainian society.

Yet the West should not accede to Russian demands. Upholding Ukraine’s sovereignty is not just about Ukraine. It is about the non-proliferation treaty itself, and global safety in a nuclear-armed world.

Yet there can be no military response from the West. Analogies to Munich 1938 are not correct. In a nuclear world, Russia will not invade the West nor can the West triumph militarily over Russia.

Similarly, sanctions will not play any real role except dig both sides deeper into confrontation. Visa restrictions are less than pin pricks, signs of silliness not policy. The UN Security Council should insist on reason from Russia, and West should insist on reason and moderation from Kiev.

All sides will lose in a deepening confrontation and horrible mistakes would be possible. Russia’s security interests should be respected, but Russia should abide by international law, and the US should do so in Syria and other areas of Russian concern. For the entire world, international law is the key to long-term survival. It may be a slender thread, but it is the only thread we have.

Follow Jeffrey Sachs on Twitter: www.twitter.com/JeffDSachs

Natural Gas: A Geo-Political Tool Or Modern Weapon?

Natural Gas: A Geo-Political Tool Or Modern Weapon?.

Fri, 03/14/2014 – 1:00am
Tom Kadala

 

The 2003 invasion of Iraq was a formidable maneuver that launched a 10+ year conflict. Today, President Obama is on the verge of another conflict in the Ukraine that involves Russia’s occupation of Crimea. Unlike Bush, however, Obama and Congress are eyeing natural gas exports as their weapon of choice to rein in Vladimir Putin from reclaiming territories along the perimeter of Russia. A geo-political tool to enable a global energy transformation or a modern weapon to settle disputes, natural gas has truly evolved.

Cleaner to burn but messy to legislate, natural gas from shale holds great promise for the US and the world. This relatively clean energy source has miraculously become the ideal bridge-fuel that society desperately needs to wean itself off its addiction to dirtier coal and oil. The rapid expansion of wells drilled since 2006 has given engineers plenty of valuable field data to improve upon yields and safety standards. From these field trials, amazing, breakthrough technologies have emerged.

Now into its eighth year, the US natural gas bonanza is no longer a nascent business for wild cat investors, its unprecedented success placing it front and center on the global stage. Presently at the helm, is the US who practically overnight, has gone from being a net importer that was often subjected to the whims of OPEC, to a net exporter. For a long time, Americans have always been taught to loathe their dependence on oil-rich countries. They often accused these oligarchs of using US oil payments to wage war against the same US freedom-fighting armies that protect their regions. With this recent change of the guards, however, Americans and their leaders are finding themselves in uncharted territory. The improved situation favors the US significantly but also leaves its leaders facing a tough dilemma.

To Prohibit or To Allow Exports
While the US can boast having the cheapest natural gas on the planet and the best technology to extract it, elected leaders in Congress must deal with two opposing issues: either to prohibit the export of US natural gas so manufacturers can create more American jobs or to allow exports to threatened US allies whose economies are constantly challenged by volatile energy prices. Already, the US’s offer to export natural gas to the Ukraine in response to Putin’s invasion of Crimea has prompted a strong reaction between both sides. Seen in this manner, one might contemplate the following question:

Could natural gas become the US enabler for global sustainable economic growth and world peace? …and if so, should it be implemented as a tool or a weapon?

There are three key benefits the US could gain from exporting its natural gas.

  • First, the US could stabilize energy prices globally for a long time. Stable energy prices would help remove a fundamental uncertainty that concerns investors. Keeping investors happy is important since they are instrumental in relieving government coffers of additional financial burdens.
  • A second benefit focuses on building global awareness on climate change. Just as the US has done to limit the use of their coal-fired power plants, other countries could be further encouraged to adopt similar environmentally friendly laws and best practices.
  • Finally, for countries seeking a free trade agreement with the US, natural gas exports could earn valuable trade concessions that could lead to integrated capacity-building among government institutions, a critical component toward establishing sustainable democracies worldwide.

These lofty expectations may be too high for even the US, considering that every new encounter will introduce more complexities and unknowns. We can only hope that US elected officials will recognize this once in a millennium opportunity and use natural gas as a tool rather than a weapon to steer the world toward a sustainable energy transformation strategy that follows a common set of internationally vetted guidelines and best practices.

Tom Kadala is an internationally recognized writer, speaker, and facilitator well-versed in economics, engineering,  technology, finance, and marketing. His views are regularly published by prominent  industry publications and also distributed to an exclusive list of contacts, some of whom he has met personally during his 20+ year tenure as the founder & CEO of Alternative Technology Corporation (ATC, Inc.). 

Russia Warns Of East Ukraine Invasion To “Defend Compatriots”, EU Threatens Gazprom, Rosneft CEOs With Visa Ban | Zero Hedge

Russia Warns Of East Ukraine Invasion To “Defend Compatriots”, EU Threatens Gazprom, Rosneft CEOs With Visa Ban | Zero Hedge.

While Russia has been massively piling up troops next to Ukraine’s eastern border, one thing that was missing to allow the crossing of the border was a provocation, aka the proverbial spark to give Moscow the green light to “defend” Russian citizens in the East. It may have just gotten that last night, when as previously reported, clashes in the eastern city of Donetsk between pro-Ukraine and pro-Russian civilians turned lethal, killing at least one person and dozens injured. A clip of the clashes can be seen below:

 

Needless to say, this escalation was just the green light Russia needed. As Reuters reports, the Russian Foreign Ministry, responding to the death of at least one protester in Ukraine’s eastern city of Donetsk, repeated President Vladimir Putin’s declaration of the right to invade to protect Russian citizens and “compatriots”.

“Russia is aware of its responsibility for the lives of compatriots and fellow citizens in Ukraine and reserves the right to take people under its protection,” it said. Curiously, organizers of the anti-Moscow demonstration said the dead man was from their group. That, however, is irrelevant, and in the fog of war, when tank batalions enter a country to “defend” select citizens, mistake are made.

In the meantime, and as we have been reporting since day one, Russian troops continue to gather:

A Reuters reporting team watched a Russian warship unload trucks, troops and at least one armored personnel carrier at Kazachaya bay near Sevastopol on Friday morning. Trucks drove off a ramp from the Yamal 156, a large landing ship that can carry more than 300 troops and up to a dozen APCs.

As also reported before, the key event in the coming days is the Crimean referendum whether to join Russia. Which is why a doomed last ditch diplomatic scramble has seen John Kerry rush to London where he later today he will meet Russian foreign minister Lavrov in a final attempt to diffuse the situation. The attempt will fail.

Summarizing it best, or perhaps just waking from a month-long nap, was the Estonian defense minister, Urmas Reinsalum who suddenly appears agitated to quite agitated:

  • PUTIN IS PREPARING TO INVADE EASTERN UKRAINE: ESTONIAN DEF MIN
  • UKRAINE EVENTS CLEARLY SHOW RUSSIA ONLY ACCEPTS FORCE: ESTONIAN DEF MIN

Hardly anyone is surprised there…

But perhaps the biggest news so far this morning is that the EU is considering visa bans to 13 Russian politicians and industry leaders, which according to Germany’s Bild, include the headest hocnho of all: Gazprom CEO Alexei Miller. From Reuters:

Visa bans threatened by the European Union and United States should Crimea vote to join Russia in a referendum would target at least 13 Russian politicians and industry leaders including Vladimir Putin’s close aides, Germany’s Bild newspaper reported.

The visa ban list includes Defence Minister Sergei Shoigu, Deputy Prime Minister Dmitry Rogozin, head of the presidential administration Sergei Ivanov, the secretary of the National Security Council Nikolai Patrushev, as well as several of Putin’s advisors, Bild said in an advance copy of a report to be published on Saturday. The report cited diplomatic sources in Brussels and Washington.

Visa bans could also be slapped on the chief executive of Russian energy firm Gazprom Alexei Miller, and Igor Sechin, head of Russia’s top crude oil producer Rosneft .

Remember, it is all about the gas. And if Europe “forces” Russia’s hand by denying Gazprom free access, then Gazprom will have no choice but to retaliate. At that point all bets are off.

Russia Warns Of East Ukraine Invasion To "Defend Compatriots", EU Threatens Gazprom, Rosneft CEOs With Visa Ban | Zero Hedge

Russia Warns Of East Ukraine Invasion To “Defend Compatriots”, EU Threatens Gazprom, Rosneft CEOs With Visa Ban | Zero Hedge.

While Russia has been massively piling up troops next to Ukraine’s eastern border, one thing that was missing to allow the crossing of the border was a provocation, aka the proverbial spark to give Moscow the green light to “defend” Russian citizens in the East. It may have just gotten that last night, when as previously reported, clashes in the eastern city of Donetsk between pro-Ukraine and pro-Russian civilians turned lethal, killing at least one person and dozens injured. A clip of the clashes can be seen below:

 

Needless to say, this escalation was just the green light Russia needed. As Reuters reports, the Russian Foreign Ministry, responding to the death of at least one protester in Ukraine’s eastern city of Donetsk, repeated President Vladimir Putin’s declaration of the right to invade to protect Russian citizens and “compatriots”.

“Russia is aware of its responsibility for the lives of compatriots and fellow citizens in Ukraine and reserves the right to take people under its protection,” it said. Curiously, organizers of the anti-Moscow demonstration said the dead man was from their group. That, however, is irrelevant, and in the fog of war, when tank batalions enter a country to “defend” select citizens, mistake are made.

In the meantime, and as we have been reporting since day one, Russian troops continue to gather:

A Reuters reporting team watched a Russian warship unload trucks, troops and at least one armored personnel carrier at Kazachaya bay near Sevastopol on Friday morning. Trucks drove off a ramp from the Yamal 156, a large landing ship that can carry more than 300 troops and up to a dozen APCs.

As also reported before, the key event in the coming days is the Crimean referendum whether to join Russia. Which is why a doomed last ditch diplomatic scramble has seen John Kerry rush to London where he later today he will meet Russian foreign minister Lavrov in a final attempt to diffuse the situation. The attempt will fail.

Summarizing it best, or perhaps just waking from a month-long nap, was the Estonian defense minister, Urmas Reinsalum who suddenly appears agitated to quite agitated:

  • PUTIN IS PREPARING TO INVADE EASTERN UKRAINE: ESTONIAN DEF MIN
  • UKRAINE EVENTS CLEARLY SHOW RUSSIA ONLY ACCEPTS FORCE: ESTONIAN DEF MIN

Hardly anyone is surprised there…

But perhaps the biggest news so far this morning is that the EU is considering visa bans to 13 Russian politicians and industry leaders, which according to Germany’s Bild, include the headest hocnho of all: Gazprom CEO Alexei Miller. From Reuters:

Visa bans threatened by the European Union and United States should Crimea vote to join Russia in a referendum would target at least 13 Russian politicians and industry leaders including Vladimir Putin’s close aides, Germany’s Bild newspaper reported.

The visa ban list includes Defence Minister Sergei Shoigu, Deputy Prime Minister Dmitry Rogozin, head of the presidential administration Sergei Ivanov, the secretary of the National Security Council Nikolai Patrushev, as well as several of Putin’s advisors, Bild said in an advance copy of a report to be published on Saturday. The report cited diplomatic sources in Brussels and Washington.

Visa bans could also be slapped on the chief executive of Russian energy firm Gazprom Alexei Miller, and Igor Sechin, head of Russia’s top crude oil producer Rosneft .

Remember, it is all about the gas. And if Europe “forces” Russia’s hand by denying Gazprom free access, then Gazprom will have no choice but to retaliate. At that point all bets are off.

Another East-Ukraine City Falls To Pro-Russian Protesters As Ukraine Denies Sending Troops To Crimea | Zero Hedge

Another East-Ukraine City Falls To Pro-Russian Protesters As Ukraine Denies Sending Troops To Crimea | Zero Hedge.

Despite clear evidence otherwise, presented here extensively yesterday, this morning Ukraine has denied that is has “plans to send armed forces to Crimea” and instead Ukrainian troops are performing “training exercises” in base, Interfax news agency quoted Acting Defence Minister Ihor Tenyukh as saying on Sunday. Responding to media speculation about Ukrainian military movements after Russian forces took control of Crimea, Tenyukh said the only troop movements that might be seen would be from one base to another to take part in the training exercises. “No movements, no departures for Crimea by the armed forces are foreseen. They are doing their routine work which the armed have always had,” he said. Right, and Russia just happened to launch an ICBM as a “drill” in the middle of the greatest Cold War re-escalation in 30 years.

Adding somewhat to the confusion was the statement by Pavlo Shysholin, head of country’s border guard service tells reporters in Kiev, who said that so far Ukrainian border guards denied entry to 3,500 people and that Ukraine border troops remain in Crimea, would leave only if “forced” but more importanly:

  • UKRAINE BORDER TROOPS BOOST FORCES ON EAST BORDER: SHYSHOLIN

So there is an escalation in the mobilization, only not toward Crimea, which the Russians already control entirely, but the critical East, which as everyone knows, is the next target for Putin annexation once the Crimean referendum passes in one week.

Confirming just this were just released photos from another major city in east Ukraine, this time Lugansk, where pro-Russian protesters just stormed and took over the city administration building. Their demand: to be part of the March 16 referendum to become part of Russia.

 

A clip of the latest peaceful pro-Russian takeover via LifeNews:

 

Lugansk’s location in context:

 

And so one by one, the cities in east Ukraine are slipping away to Russia, even as Obama continues his Key Largo vacation and makes the occasional phone call.

Another East-Ukraine City Falls To Pro-Russian Protesters As Ukraine Denies Sending Troops To Crimea | Zero Hedge

Another East-Ukraine City Falls To Pro-Russian Protesters As Ukraine Denies Sending Troops To Crimea | Zero Hedge.

Despite clear evidence otherwise, presented here extensively yesterday, this morning Ukraine has denied that is has “plans to send armed forces to Crimea” and instead Ukrainian troops are performing “training exercises” in base, Interfax news agency quoted Acting Defence Minister Ihor Tenyukh as saying on Sunday. Responding to media speculation about Ukrainian military movements after Russian forces took control of Crimea, Tenyukh said the only troop movements that might be seen would be from one base to another to take part in the training exercises. “No movements, no departures for Crimea by the armed forces are foreseen. They are doing their routine work which the armed have always had,” he said. Right, and Russia just happened to launch an ICBM as a “drill” in the middle of the greatest Cold War re-escalation in 30 years.

Adding somewhat to the confusion was the statement by Pavlo Shysholin, head of country’s border guard service tells reporters in Kiev, who said that so far Ukrainian border guards denied entry to 3,500 people and that Ukraine border troops remain in Crimea, would leave only if “forced” but more importanly:

  • UKRAINE BORDER TROOPS BOOST FORCES ON EAST BORDER: SHYSHOLIN

So there is an escalation in the mobilization, only not toward Crimea, which the Russians already control entirely, but the critical East, which as everyone knows, is the next target for Putin annexation once the Crimean referendum passes in one week.

Confirming just this were just released photos from another major city in east Ukraine, this time Lugansk, where pro-Russian protesters just stormed and took over the city administration building. Their demand: to be part of the March 16 referendum to become part of Russia.

 

A clip of the latest peaceful pro-Russian takeover via LifeNews:

 

Lugansk’s location in context:

 

And so one by one, the cities in east Ukraine are slipping away to Russia, even as Obama continues his Key Largo vacation and makes the occasional phone call.

Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over “Unfriendly NATO Threats” | Zero Hedge

Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over “Unfriendly NATO Threats” | Zero Hedge.

Perhaps it is time to finally admit that anyone who thought Putin’s Tuesday press conference, which the market so jubilantly assumed was a case of “blinking” and de-escalating tensions with the west, was wrong. If there is still any confusion, following yesterday’s news that Gazprom officially threatened Ukraine with cutting off its gas supplies, as well as the storming of a Ukraine base by Russian troops – luckily with no shots fired so far – then today’s developments should any remaining doubts. Moments ago AP reported that as the latest, third in a row, group of OSCE inspectors tried to enter Ukraine, they were not only barred from doing so, but warnings shots were fired to emphasize the point by pro-Russian forces.

From AP:

An Associated Press reporter says pro-Russian forces refused to let a foreign military mission enter Crimea on Saturday.

After the officers had stopped, the armed men fired warning bursts of automatic weapons fire into the air to make other unidentified vehicles halt. No injuries were reported.

The multinational group of military officers from the Organization for Security and Cooperation in Europe was attempting to enter the embattled peninsula from the north. The armed men told them they had no authorization to enter Crimea.

The OSCE mission will likely return to the Ukrainian city of Kherson where it had spent the night, the AP reporter said.

Russia and Ukraine are locked in a tense standoff over Crimea.

Bloomberg adds:

OSCE tried to enter Crimea for third day, warning shots were fired as it attempted to do so today, Tatyana Baeva, OSCE spokeswoman, said by phone from Vienna.

Nobody injured in incident, OSCE mission is now back in Kherson, southern Ukraine.

OSCE 29 member states that provided people for Crimea mission may meet today or tomorrow in Vienna to discuss further action: Baeva

Then there was this overnight escalation as reported by Ukraine’s TV5 station (of questionably credibility), via Bloomberg:

Pro-Russian armed men today captured building in Simferopol, capital city of Crimea, TV5 private news channel reports, citing Vladislav Selezniov, spokesman for Ukraine’s defense minister in Crimea.

Russian soldiers seized Ukraine’s state border guard division in Shcholkino near Kerch Strait, Ukraine’s border service says in statement on its website

Russian soldiers stormed Shcholkino unit last night, seized weapons storage, beat Ukrainian border guards, took away their mobile phones and forced them and their families to leave

Currently, 11 border guard units are being blocked: Ukraine border service says in separate statement

Ukraine denied entrance to 513 “extremists” from Russia during last 24 hrs, state border guard service says in another separate statement on its website

Remember, all it takes is for one stray bullet to hit a human target, on either side of the conflict, for the market to grasp just how wrong its assessment of de-escalation has been.

Elsewhere, while inspectors were trying to make their way into Ukraine – unsuccessfully – Russia announced it was considering a further freeze of U.S. military inspections under arms control treaties in retaliation to Washington’s decision to halt military cooperation with Russia, news reports said Saturday.

Interfax blasted earlier:

  • UNJUSTIFIED U.S., NATO THREATS SEEN AS UNFRIENDLY GESTURE, ALLOW TO DECLARE FORCE-MAJEURE – RUSSIAN DEFENSE SOURCE
  • RUSSIAN DEFENSE MINISTRY CONSIDERING SUSPENSION OF RECEIVING INSPECTION GROUPS UNDER START TREATY, VIENNA DOCUMENT 2011 – SOURCE

AP has more:

Russian news agencies carried a statement by an unidentified Defense Ministry official saying that Moscow sees the U.S. move as a reason to suspend U.S. inspections in Russia in line with the 2010 New START treaty on cutting U.S. and Russian nuclear arsenals and the 2011 Vienna agreement that envisages mutual inspections of Russian and NATO military facilities as part of confidence-building measures.

A Defense Ministry spokesman wouldn’t comment on the reports, which are a usual way in Russia to carry unofficial government signals.

The U.S. and the European Union have introduced sanctions over Russia in response to its move to send troops that have taken control of Ukraine’s Black Sea peninsula of Crimea.

So if the START treaty is suspended how long until its anti-proliferation clauses are scrapped completely once more, and the Cold War arms race returns once again.

Also, \while escalations such as these threaten to transform the new Cold War into a hot one, the clock is ticking, and in favor of Russia, because the longer Ukraine remains without western aid, the quicker its foreign reserves will run out, and the faster the country will become a vassal state of Gazpromia. Add the ticking countdown to the March 16 Crimean referendum, which the west and Ukraine have both declared illegitimate yet have no power to stop, and suddenly one can see how Putin once again outsmarted everything the west had to throw at it. WSJ explains:

Gazprom’s demand raises the prospect that some of the aid Western powers have guaranteed could end up flowing into Moscow’s coffers to pay Ukraine’s gas bill. Virtually all of the country’s natural-gas imports come from Russia. Late last year it was granted a discount that Moscow has threatened to rescind since the fall of Mr. Yanukovych.

“This now becomes an EU/U.S. problem: Who is going to lend Ukraine the money to pay the gas bill? If so, what will be the conditions?” said Jonathan Stern, an analyst at the Oxford Energy Institute.

A spokesman for Gazprom said that the threatened cutoff wouldn’t affect supplies to Europe, which gets about a third of its gas from Russia, much of it via pipelines that run through Ukraine.

 

 

In 2009, after the Russian energy giant switched off the supply to Ukraine, Ukrainian authorities began using the supply transiting their territory that Gazprom said was destined for customers in Europe. Gazprom then cut off the flow altogether, causing shortages and price increases for end customers.

 

“The EU, U.S. and IMF have just about three weeks to resolve this,” Mr. Stern said.

At which point it’s game, set match Putin once more.

Finally, what certainly helped Russia is that, as expected, China took the side of Putin, not of the “free world”, in what is now a very distinct and clear axis of power the New Normal dipolar world.

Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over "Unfriendly NATO Threats" | Zero Hedge

Warning Shots Fired At OSCE Mission In Crimea; Russia Threatens Treaty Force Majeure Over “Unfriendly NATO Threats” | Zero Hedge.

Perhaps it is time to finally admit that anyone who thought Putin’s Tuesday press conference, which the market so jubilantly assumed was a case of “blinking” and de-escalating tensions with the west, was wrong. If there is still any confusion, following yesterday’s news that Gazprom officially threatened Ukraine with cutting off its gas supplies, as well as the storming of a Ukraine base by Russian troops – luckily with no shots fired so far – then today’s developments should any remaining doubts. Moments ago AP reported that as the latest, third in a row, group of OSCE inspectors tried to enter Ukraine, they were not only barred from doing so, but warnings shots were fired to emphasize the point by pro-Russian forces.

From AP:

An Associated Press reporter says pro-Russian forces refused to let a foreign military mission enter Crimea on Saturday.

After the officers had stopped, the armed men fired warning bursts of automatic weapons fire into the air to make other unidentified vehicles halt. No injuries were reported.

The multinational group of military officers from the Organization for Security and Cooperation in Europe was attempting to enter the embattled peninsula from the north. The armed men told them they had no authorization to enter Crimea.

The OSCE mission will likely return to the Ukrainian city of Kherson where it had spent the night, the AP reporter said.

Russia and Ukraine are locked in a tense standoff over Crimea.

Bloomberg adds:

OSCE tried to enter Crimea for third day, warning shots were fired as it attempted to do so today, Tatyana Baeva, OSCE spokeswoman, said by phone from Vienna.

Nobody injured in incident, OSCE mission is now back in Kherson, southern Ukraine.

OSCE 29 member states that provided people for Crimea mission may meet today or tomorrow in Vienna to discuss further action: Baeva

Then there was this overnight escalation as reported by Ukraine’s TV5 station (of questionably credibility), via Bloomberg:

Pro-Russian armed men today captured building in Simferopol, capital city of Crimea, TV5 private news channel reports, citing Vladislav Selezniov, spokesman for Ukraine’s defense minister in Crimea.

Russian soldiers seized Ukraine’s state border guard division in Shcholkino near Kerch Strait, Ukraine’s border service says in statement on its website

Russian soldiers stormed Shcholkino unit last night, seized weapons storage, beat Ukrainian border guards, took away their mobile phones and forced them and their families to leave

Currently, 11 border guard units are being blocked: Ukraine border service says in separate statement

Ukraine denied entrance to 513 “extremists” from Russia during last 24 hrs, state border guard service says in another separate statement on its website

Remember, all it takes is for one stray bullet to hit a human target, on either side of the conflict, for the market to grasp just how wrong its assessment of de-escalation has been.

Elsewhere, while inspectors were trying to make their way into Ukraine – unsuccessfully – Russia announced it was considering a further freeze of U.S. military inspections under arms control treaties in retaliation to Washington’s decision to halt military cooperation with Russia, news reports said Saturday.

Interfax blasted earlier:

  • UNJUSTIFIED U.S., NATO THREATS SEEN AS UNFRIENDLY GESTURE, ALLOW TO DECLARE FORCE-MAJEURE – RUSSIAN DEFENSE SOURCE
  • RUSSIAN DEFENSE MINISTRY CONSIDERING SUSPENSION OF RECEIVING INSPECTION GROUPS UNDER START TREATY, VIENNA DOCUMENT 2011 – SOURCE

AP has more:

Russian news agencies carried a statement by an unidentified Defense Ministry official saying that Moscow sees the U.S. move as a reason to suspend U.S. inspections in Russia in line with the 2010 New START treaty on cutting U.S. and Russian nuclear arsenals and the 2011 Vienna agreement that envisages mutual inspections of Russian and NATO military facilities as part of confidence-building measures.

A Defense Ministry spokesman wouldn’t comment on the reports, which are a usual way in Russia to carry unofficial government signals.

The U.S. and the European Union have introduced sanctions over Russia in response to its move to send troops that have taken control of Ukraine’s Black Sea peninsula of Crimea.

So if the START treaty is suspended how long until its anti-proliferation clauses are scrapped completely once more, and the Cold War arms race returns once again.

Also, while escalations such as these threaten to transform the new Cold War into a hot one, the clock is ticking, and in favor of Russia, because the longer Ukraine remains without western aid, the quicker its foreign reserves will run out, and the faster the country will become a vassal state of Gazpromia. Add the ticking countdown to the March 16 Crimean referendum, which the west and Ukraine have both declared illegitimate yet have no power to stop, and suddenly one can see how Putin once again outsmarted everything the west had to throw at it. WSJ explains:

Gazprom’s demand raises the prospect that some of the aid Western powers have guaranteed could end up flowing into Moscow’s coffers to pay Ukraine’s gas bill. Virtually all of the country’s natural-gas imports come from Russia. Late last year it was granted a discount that Moscow has threatened to rescind since the fall of Mr. Yanukovych.

“This now becomes an EU/U.S. problem: Who is going to lend Ukraine the money to pay the gas bill? If so, what will be the conditions?” said Jonathan Stern, an analyst at the Oxford Energy Institute.

A spokesman for Gazprom said that the threatened cutoff wouldn’t affect supplies to Europe, which gets about a third of its gas from Russia, much of it via pipelines that run through Ukraine.

 

 

In 2009, after the Russian energy giant switched off the supply to Ukraine, Ukrainian authorities began using the supply transiting their territory that Gazprom said was destined for customers in Europe. Gazprom then cut off the flow altogether, causing shortages and price increases for end customers.

 

“The EU, U.S. and IMF have just about three weeks to resolve this,” Mr. Stern said.

At which point it’s game, set match Putin once more.

Finally, what certainly helped Russia is that, as expected, China took the side of Putin, not of the “free world”, in what is now a very distinct and clear axis of power the New Normal dipolar world.

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