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Montag, 24. Juli 2017

EU "Sounds Alarm" Over New US Sanctions On Russia; Germany Threatens Retaliation

EU "Sounds Alarm" Over New US Sanctions On Russia; Germany Threatens Retaliation




Tyler Durden's picture
Late on Friday, Congressional negotiators reached a deal to advance a bill that would punish Russia for its interference in the 2016 election and restrict the president’s power to remove sanctions on Moscow, according to the WSJ. The measure, if signed into law, will also give Congress veto powers to block any easing of Russian sanctions by the president. And while it remained unclear if President Donald Trump would sign the bill if it reaches his desk, which is now likely, the loudest complaint about the bill to date has emerged noe from the Oval Office, but from Brussels, after the EU once again urged (and warned, and threatened) US lawmakers to coordinate their anti-Russia actions with European partners, or else.
As Reuters reports, the European Union "sounded an alarm on Saturday" about moves in the U.S. Congress to step up U.S. sanctions on Russia, urging Washington to keep coordinating with its G7 partners.  In a statement by a spokeswoman after Republicans and Democrats in the U.S. Congress reached a deal that could see new legislation pass, the European Commission warned of possibly "wide and indiscriminate" "unintended consequences", especially on the EU's efforts to diversify energy sources away from Russia, adding that "unilateral measures" by the US could undermine transatlantic unity.
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"We highly value the unity that is prevailing among international partners in our approach towards Russia's action in Ukraine and the subsequent sanctions. This unity is the guarantee of the efficiency and credibility of our measures," the Commission said in its statement.

"We understand that the Russia/Iran sanctions bill is driven primarily by domestic considerations," it went on, referring to a bill passed in the U.S. Senate last month and to which lawmakers said on Saturday they had unblocked further obstacles.

"As we have said repeatedly, it is important that any possible new measures are coordinated between international partners to maintain unity among partners on the sanctions that has been underpinning the efforts for full implementation of the Minsk Agreements," the Commission said, referring to an accord struck with Moscow to try to end the conflicts in Ukraine.

"We are concerned the measures discussed in the U.S. Congress could have unintended consequences, not only when it comes to Transatlantic/G7 unity, but also on EU economic and energy security interests. This impact could be potentially wide and indiscriminate, including when it comes to energy sources diversification efforts.

"Sanctions are at their most effective when they are coordinated. Currently our sanctions regimes are coordinated. As a result their impact on the ground is increased and through coordination we are able to avoid surprises, manage potential impact on our own economic operators and address collectively efforts to circumvent such measures. Unilateral measures would undermine this," the Commission said.

"We therefore call on the U.S. Congress/authorities to engage with the partners, including the EU, to ensure coordination and to avoid any unintended consequences of the measures discussed."
Furthermore, Germany has already warned of "possible retaliationif the United States moves to sanction German firms involved with building a new Baltic pipeline for Russian gas. EU diplomats are concerned that a German-U.S. row over the Nord Stream 2 pipeline being built by Russia's state-owned Gazprom could complicate efforts in Brussels to forge an EU consensus on negotiating with Russia over the project.
The proposed restrictions against Moscow are part of the Countering Iran’s Destabilizing Activities Act, aimed not only at Tehran, but also North Korea. Passed by the Senate last month, the measures seek to impose new economic measures on sectors of Russia’s economy. Among the new anti-Russia proposals, the legislation aims to introduce individual sanctions for investing in Russian pipeline project. It also outlines steps to hamper construction of Russia’s Gazprom’s Nord Stream 2 gas pipeline project, and is the reason why America's European allies are on edge, worried they may be penalized for continuing a project in which they have already invested hundreds of millions.
The House is set to vote on the proposed legislation Tuesday, Brussels has already registered its unease even before the bill hits Donald Trump’s desk, urging Washington to consider European interests, especially in the energy sector. Noting that “the Russia/Iran sanctions bill is driven primarily by domestic considerations,” the European Commission has asked its American partners to coordinate measures against Russia with Europe and the rest of the G7.  
One month ago, we reported that Austria and Germany accused the U.S. of having ulterior motives in seeking to enforce the energy blockade, which they said is trying to help American natural gas suppliers at the expense of their Russian rivals. They also warned the threat of fining European companies participating in the Nord Stream 2 project "introduces a completely new, very negative dimension into European-American relations."  At the time, the foreign minister of Austria and Germany, Kern and Gabriel, urged the United States to back off from linking the situation in Ukraine to the question of who can sell gas to Europe. "Europe's energy supply is a matter for Europe, and not for the United States of America," Kern and Gabriel said. The reason why Europe is angry Some Eastern European countries, including Poland and Ukraine, fear the loss of transit revenue if Russian gas supplies don't pass through their territory anymore once the new pipeline is built.
Fast forward to today, when Reuters quoted the European Commission saying that “as we have said repeatedly, it is important that any possible new measures are coordinated between international partners to maintain unity among partners on the sanctions." It added that “we are concerned the measures discussed in the US Congress could have unintended consequences, not only when it comes to Transatlantic/G7 unity, but also on EU economic and energy security interests."
“This impact could be potentially wide and indiscriminate,” the Commission warned. “We therefore call on the US Congress/authorities to engage with the partners, including the EU, to ensure coordination and to avoid any unintended consequences of the measures discussed.
Addressing the proposed bill, Kremlin spokesman Dmitry Peskov said that Moscow takes an “extremely negative” view of the new developments. President Vladimir Putin earlier cautioned that any new sanctions against Russia will only make US-Russian relations worse.
But it wasn't just Russia and Europe eager to warn the US that any ongoing attempts to trap Trump into perpetuating the Deep State's Russian policies would backfire: ahead of Congress clearing all potential hurdles for the bill, a number of American multinationals – including ExxonMobil, General Electric and Boeing, as well as MasterCard and Visa – raised concerns that the punitive measures will ultimately harm their interests, rather than that of the Kremlin

Samstag, 22. Juli 2017

Bedeutung des VEN-Oil für die USA


eine der letzten pünktlichen Zahlungen ? // ich glaube die zahlen durch....we will see


The United States is considering financial sanctions on Venezuela that would halt dollar payments for the country's oil, according to a senior White House official and an adviser with direct knowledge of the discussions.

The United States is considering financial sanctions on Venezuela that would halt dollar payments for the country's oil, according to a senior White House official and an adviser with direct knowledge of the discussions.
The move could severely restrict the OPEC nation's crude exports and starve its socialist government of hard currency.
Venezuela's President Nicolas Maduro uses binoculars during a rally in Caracas, Venezuela April 19, 2017.
Miraflores Palace | Handout via Reuters
Venezuela's President Nicolas Maduro uses binoculars during a rally in Caracas, Venezuela April 19, 2017.
Sanctions prohibiting any transaction in U.S. currency by Venezuela's state-run oil firm, PDVSA, are among the toughest of various oil-related measures under discussion at the White House, the two sources told Reuters.
The administration aims to pressure socialist President Nicolas Madurointo aborting plans for a controversial new congress that critics say would cement him as a dictator.
Venezuela's oil-based economy is in the grip of a brutal recession and a local currency crash, and Maduro has faced months of anti-government unrest that has claimed the lives of about 100 people. Sanctions on dollar transactions would make it even harder for Maduro's government to secure cash for debt payments and finance imports of basic goods.
The White House declined to comment on the sanctions under consideration. PDVSA and Venezuela's Oil Ministry did not immediately respond to requests for comment.
The U.S. measures under discussion are similar to those that were imposed against Iran over its nuclear program - which halved Iran's oil exports and prevented top crude buyers from paying for Iranian oil.
The measures were seen as among the most effective economic sanctions ever imposed and paved the way for a deal that curbed Tehran's nuclear activity.
Measures on financial transactions would give President Donald Trump's administration the power to escalate pressure on Venezuela by threatening punishment of any U.S. firm doing business with PDVSA or U.S. banks processing any of its transactions in dollars.
The financial restrictions have been "raised repeatedly" in recent discussions about options for actions against Maduro's government, said the senior White House official, who spoke on condition of anonymity.
The administration is also discussing a ban on U.S. oil imports from Venezuela, but no final decisions have been reached, the official said.
Sanctions on dollar transactions could be more punitive than an import ban because they would make it much more difficult for any refiner or trader to buy Venezuelan oil - not just customers
in the United States.
The impact of sanctions on PDVSA would ripple across oil markets, forcing refiners to buy alternative supplies. The U.S. could use crude from its Strategic Petroleum Reserve (SPR) to blunt the impact of any short-term supply shortage, the policy adviser told Reuters.
The United States bought 780,000 barrels per day (bpd) of Venezuelan crude and refined products in the first four months of 2017, according to the Energy Information Administration,
nearly 8 percent of total imports. PDVSA is a major supplier to Valero Energy, Phillips 66, Chevron Corp and PBF Energy.
PDVSA's refining unit in the United States, Citgo Petroleum, last month was the second largest recipient of Venezuelan crude.
It is unclear how Citgo, being wholly owned by Venezuela, would be impacted by U.S. sanctions. Citgo operates three refineries, pipelines and a fuel distribution network in the United States.
The threat of sanctions against Venezuela was a key reason for talks this week between PDVSA and Rosneft, Russia's leading state-owned oil firm, which is already under U.S. sanctions. The negotiations in Moscow, reported by Reuters earlier this week, focused on a proposed swap of Rosneft's collateral stake in Citgo for a host of other Venezuelan oil assets - a move to avoid legal complications.

Barter deals create cash crunch

The White House said earlier this week that Trump's administration could take what it called "strong and swift economic actions" against Venezuela as soon as July 30.
Other options under consideration by Washington include putting more Venezuelan officials and PDVSA executives on its sanctions list, the two sources told Reuters.
Maduro intends to create a superbody called the constituent assembly this year that would have the power to rewrite the country's constitution. It would supersede other institutions and replace the democratically elected National Assembly.
Maduro has decried what he calls "imperialist meddling" by U.S. officials.
Several governments in Latin America also have called on Maduro to abandon the assembly plan.
But officials in neighboring countries also expressed concern that U.S. economic sanctions would trigger famine in Venezuela, which is already reeling from shortages of food and medicine.
PDVSA's cash flow has plummeted in recent years, in part due to the Venezuelan government's deals to barter its oil to other nations in exchange for fuels, services and loans.
Chinese and Russian entities currently take about 40 percent of all PDVSA's exports as repayment for more than $50 billion in loans to Venezuela and its oil company in the last decade, according to a Reuters analysis of its sales.
PDVSA also barters with Caribbean nations, Indian refiner Reliance and its unit Citgo.
Almost all of PDVSA's cash-paying customers are in the United States and India, and the preferred currency for oil transactions worldwide is the U.S. dollar.
PDVSA currently collects most payments from oil exports using China's Citic Bank, but customers making dollar transfers require a correspondent bank in the United States to guarantee the money arrives in China.
The Venezuelan oil firm has been struggling to find correspondent banks in the United States since Citibank a year ago suspended providing that service. It would have even fewer options to collect dollars if the sanctions are levied.
The company could seek payment in euros through European bank accounts, or use other non-dollar denominated transactions.
But the European Union could also take similar measures to prevent transactions in euros, following the lead of the United States.

Sanction threat rattles US refiners

The crude import ban has been strongly opposed by oil companies and crude processors because of the impact it could have on the refining sector, especially on the U.S. Gulf Coast.
Administration officials have heard from U.S. refiners on the hardships an import ban could have on their businesses and "are now measuring its potential impact on prices, market movement, inventories," the policy adviser to the White House told Reuters.
Phillips 66 - the third largest buyer of Venezuelan crude in the United States this year - said on Thursday that the administration should "carefully consider" sanctions that would affect U.S. refiners and not prevent the sale of Venezuelan crude elsewhere.
Valero did not respond to a request for comment. Chevron declined to comment.
Chet Thompson, chief executive of trade group American Fuel & Petrochemical Manufacturers (AFPM), has been calling and writing White House officials, urging they consider something other than an Venezuelan oil import ban.
Some refineries get up to half their supply from Venezuela, he said in an interview Friday.
"It's not easily replaced," he said, adding that the sanctions also may not have their intended effect.
"Venezuela," he said, "will just sell it to someone else."

The Hunger Bonds

The Hunger Bonds

CAMBRIDGE – Investing often creates moral dilemmas over goals: Should we aim to do well or to do good? Is it appropriate to invest in tobacco companies? Or in companies that sell guns to drug gangs?
The recent popularity of so-called impact investment funds, which promise to deliver decent returns while advancing social or environmental goals, is based on this unease. Foundations often find that these investment vehicles help them to do good both with the money that they spend on philanthropy and with the endowment assets that yield the returns on which their philanthropy depends.
Nowadays, it is emerging markets as an asset class that should make people morally queasy. Should decent people put their money in emerging-market bond funds?
The returns of the JP Morgan Emerging Market Bond Index (EMBI+) are heavily influenced by what happens in Venezuela. The reason is simple: while Venezuela represents only about 5% of the index, it accounts for about 20% of its yield, because the yield on Venezuelan debt is about five times larger than that of other countries in the index, a reflection of the huge risk premium that Venezuela faces. Moreover, the price volatility of Venezuelan debt – the highest in the EMBI+ – accounts for a disproportionate share of the index’s daily price movements.
You might invest in the EMBI+ because it promises higher returns, or because you want to make your savings available to a larger segment of humanity. But if you do, you will root for Venezuelan debt, which means wishing for really bad things to happen to Venezuela’s people.
As has been widely reported in the media, Venezuela is experiencing one of the most calamitous economic collapses ever, accompanied by massive doses of political repression and human-rights violations. So investing in the EMBI+ means that you rejoice when Wall Street analysts inform you that the country is literally starving its people in order to avoid restructuring your bonds.
Your happiness is easily explained: Venezuelan imports, after having collapsed by 75% from 2012 to 2016, are down more than 20% in the first quarter of 2017. That’s good news for you as an EMBI+ investor, because it means that more money is left to service your bonds. Meanwhile, Venezuelans are involuntarily losing weight and searching for food in garbage piles. Sure, it’s a humanitarian catastrophe. But, to you, it’s a fabulous investment opportunity.
Now assume that you want to hold Venezuelan debt because you are hoping that President Nicolás Maduro will lose power and that a more sensible, democratically minded government, more in line with your moral compass, will emerge. Even in that case, you will still want the gains from Venezuela’s future recovery to be used preferentially to service the old debt issued to finance the corruption and national destruction brought about by Maduro and his predecessor, Hugo Chávez. You will not be rooting for the recovery of livelihoods that Venezuelans deserve after having lived through this nightmare.
You will also be rooting for US judges to seize assets and impound money to pay you. In fact, analysts who are bullish on Venezuelan debt have been lobbying the government and opposition leaders with an implied threat: even considering a restructuring of your bonds, they point out, will allow those managing your assets to cause havoc in Venezuela.
If you are a decent human being, investing in Venezuelan bonds should make you feel “mildly nauseous,” to borrow a phrase recently used by former FBI Director James Comey while testifying to the US Congress. Emerging-market fund managers feel a similar discomfort. They currently spend a disproportionate share of their time “getting the Venezuelan call right,” because their bonuses are based on their over-performance relative to the index – of which Venezuela is the main driver.
The less morally burdened among them bask in the recognition they receive for having been right to predict that Maduro’s government would decide to starve its people rather than restructure the bonds you hold. Analysts and bondholders have also lobbied the government and the opposition not to seek financial support from the International Monetary Fund, for fear that the international community will demand that you accept a significant “haircut” on your investment, as has been required of Greece’s creditors.
That would probably not be “good for the credit.” Analysts and bondholders have also lobbied the opposition-controlled National Assembly to recognize Venezuela’s external debt in exchange for the freedom of political prisoners, implying that the payment of your bonds can be secured through ransom.
So, should you stop investing in emerging-market funds just because 5% of your savings would go toward financing Venezuela? Clearly, this would punish other countries that are innocent bystanders in the Venezuelan mess. There must be a better way.
There is. The solution is to demand that JPMorgan immediately exclude Venezuela from the emerging market bond indexes it calculates, thereby freeing fund managers from the need to compare their performance with hunger bonds. Over time, JPMorgan should introduce a Decent Emerging Markets index, which would save you from moral anguish by ensuring that only countries adhering to minimal standards of respect for their citizens are included. The DEM would allow you to root for higher returns on your savings without wishing for human misery. You could do well, without feeling bad.