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This Russian Trend Is Not Europe's Friend

The cold war is on, literally, because it will determine who will survive Europe's upcoming cold winter - a Europe with decreasing Russian gas supplies, or Russia now officially starved of Western sources of funding. The "Plan Bs" - Europe has record gas inventories in storage giving it hope it can last out an entire winter without any incremental Russian gas, while Russia is increasingly reliant and hoping on China-based sources of funding. While it remains to be seen just how Russian corporations will react to the recently imposed credit starvation, the chart below shows the steps Russia is now taking ahead of the European winter. Clearly, the trend in Russian gas supplies into Europe's core distribution hub, Slovakia, is not Europe's friend.

Of course, Gazprom had a politically acceptable excuse for the trend: "technical reasons." We assume that not even the Eurocrats in Brussels will fall for that one.

If and when the blue bar hits zero, the cold war will officially have resumed.