If you read further down in the article, China is suffering from a drought that’s been the worse in decades

Edit monsoon not drought. Thanks s1artibartfast

“In the second half of last year, swaths of farmland in the world’s largest rice producer China were plagued by heavy summer monsoon rains and floods. The accumulated rainfall in the country’s Guangxi and Guangdong province, China’s major hubs of rice production, was the second highest in at least 20 years, according to agriculture analytics company Gro Intelligence. Similarly, Pakistan — which represents 7.6% of global rice trade — saw annual production plunge 31% year-on-year due to severe flooding last year, said the U.S. Department of Agriculture (USDA), labeling the impact as ‘even worse than initially expected.’”

Reading further, I’m not sure why Ukraine is mentioned either since their major food export is wheat and not rice

One thing I could think of spontaniously is this: Ukraine is exporting less (they seemed to recover, but markets and the bullwhip effect don't care rigjt away), so shortfall of Ukrainian grain has to be compensated and rice is one such alternative. As a result some of the grain shortages are causing rice shortages. Throw in problems in China and the situation gets really confusing and complex.

Point of clarification, China is suffering from monsoon, not drought

The country's land mass is big enough that it's possible for both to be true, no?

Possible, but article actually supports one reason and not the other.

>The accumulated rainfall in the country’s Guangxi and Guangdong province, China’s major hubs of rice production, was the second highest in at least 20 years,

It's really a combination of drought in some regions and monsoon in others, both being pushed to extremes by fossil-fueled global warming:

https://www.gro-intelligence.com/insights/china-drought-thre...

> "(Aug 22) China has issued a nationwide drought warning as the country copes with scant rainfall and one of the most severe heat waves in six decades. The harsh weather is stressing rice and wheat crops and could force China to increase imports of these important grains....In addition, soil moisture levels are at a 12-year low, and Gro’s Drought Index reading is elevated. "

https://www.gro-intelligence.com/insights/extreme-weather-me...

> "(Jun 2022) Typically, China's rainy season occurs from May to September, and this year’s season is already off to an extreme start. The accumulated rainfall in Guangxi, Guangdong, and Fujian is the second highest in at least 20 years, and some regions, such as Guangdong and Guangxi, have experienced double the average daily precipitation for the May to June period..."

These extreme fluctuations in drought and flood are not going away, of course, and will continue to get worse over the next 100 years.

Also climate change and environmental racism are to blame most likely

The article suggests is due to rice replacing other grains in the global diet.

Between Russia and the Ukraine 27% of the worlds wheat supply is impacted by the war and another 15% of the worlds corn.

It seems reasonable to conclude that would have an impact on the price of other grain staples.

And yet wheat futures (ZW) have been falling steadily for the past six months and are now below the pre-invasion levels.

price =|= availability

The very purpose of futures contracts is to ensure availability in the future at a predetermined price. I am not sure what your point is.

That there is no guarantee that the stuff will be available so, thing shappen. Also, just because futures are cheap, doesn't mean stuff is available now or in the near future. It only means the markets think grain will be plenty at one point, and thus cheap.

All a low futures price means is that money men are betting there won't be a shortage, it doesn't say anything about whether there will be a shortage or not.

Price is not solely determined by availability, but it is largely determined by availability, especially in the case of rapid shifts in availability (since other factors take time to adjust in response).

That would imply that rice pressure would come down in the future easing the deficit (assuming global tastes haven’t permanently changed).

The article mentions a surplus next year is anticipated.

Yet Poland, Hungary, Slovakia, and Bulgaria say Ukrainian grain is too cheap and upsets local farmers. Guys, but the EU said it was for feeding the poor, and not for making pierogi. I’m so confused at this point.

Both could be true. A glut of product trying to make its way through ports & other logistic routes that it usually doesn't, might drive down the price of the product at those ports—while, globally, the supply might be lower and prices higher.

Think up a toy case with some remote old-west town coming into a glut of some bulky, perishable good, but having only one train line to distribute it, and the potential for this effect becomes clear. Or an island, or whatever. The logistics systems in question aren't that isolated, obviously, but they still have limited capacity that's unlikely to go up much in response to anything perceived as only a temporary situation, so they absolutely might see local prices (including for export) depressed even as global prices rise. It's not implausible.

I think it’s a lot of words trying to justify why the “grain deal” hasn’t achieved the declared goals. I’m sure lots of profit has been made though.

The war in Ukraine drives up prices of fuel which has a knock on effect to just about everything else.

Also the cost/availability of fertilizer on the other side of the conflict

https://www.npr.org/2022/09/28/1125525861/how-the-war-in-ukr...

Saudi Arabia effectively sets the price of oil. Ukraine doesn't produce any of it. Some tanks banging around the countryside there are not major consumers of oil, one oil tanker crossing the ocean is burning and blasting through orders of magnitude more oil.

Russia is a major producer of oil and gas, which has been extremely sanctioned. Oil and gas that used to come from Russia need to come from somewhere else, raising demand (and thus, prices) for other producers.

No Russia made new agreements with China, India, etc. and their oil and gas is being "laundered" through sales to those countries and back out to the west. The sanctions have failed to do anything.

This is extremely wrong. The pipes are not flowing. There is oil being transferred via ships, but this is a much smaller volume and is much more expensive. It is not possible to sell the same amount without the pipelines to Europe.

Russian exports and revenues have fallen drastically.

You are not up to date on the reality of the situation, Russian oil exports are back to prewar levels: https://www.cnn.com/2023/04/14/energy/russia-oil-exports-iea...

They sell oil to a lot more places than Europe!

But what about the price of gas and oil on Europe, isn't that the salient point?

The goal of sanctions wasn't to raise the price of oil, it was to crush the Russian economy which the west assumed depended on Russia exporting oil and gas directly to Europe. That goal appears to have failed as Russia just made new agreements to sell oil/gas to other countries (who then sell to Europe).

On the contrary, that goal has worked pretty well. Russia has to sell crude now, plus at very low price points. It's a shame that China and especially India continue to buy, but at least they're taking advantage of the situation to pay a pittance so Russia isn't making profits with it.

Russia's economy isn't crushed but it has now a massive budget deficit that isn't sustainable without some extreme adaptations.

Your own link cited a 43% drop in revenue, a 21% drop in income, and a large deficit.

Yes but the purpose of sanctions isn't important to me. My question is has the war increased the prices of fuel that the global supply chain relies on and, in turn, wholesale prices for goods.

Cool. But if you’re only going to look out for yourself, don’t be surprised when you’re at the bottom of the list of concerns for people who are looking to cooperate for the common good.

That's sorta twisting my words to the point that I'm struggling not to be offended.

Of course the sanctions are important to me.

But the original question was Does the war in Ukraine affect global prices for seemingly unrelated things.

When I say the purpose of the sanctions aren't important to me I feel it's obvious that I mean only within the context of answering this question.

Sure. Sorry. Fwiw, I don’t think that’s implied at all however. I think it strongly implies that the purpose of the sanctions simply don’t matter to you. Which is a common opinion

It’s still going to be a lot lower than it would have been. The important bit from a sanction perspective is that their revenue is down 43%.

And oil&gas revenue make up a significant portion of the government's budget.

Do not conflate volume with value and oil with natural gas.

Natural gas exports to Europe was Russia's big thing. The value of their oil and natural gas exports to the rest of world has failed make up for this loss.

Even for Russian oil your own link says there has been a 43% drop in revenue and a 21% drop in income.

It was big news this month when Russian oil exports finally made it back to prewar levels. Their revenue is still off by ~45% from prewar.

The sanctions absolutely did something. Though I think it’s reasonable to ask if they caused a net increase in the cost of oil after the initial shock given how big a discount Russian oil buyers are getting. Though even if exports stabilized it’s possible the market is paying a risk premium.

The point of the sanctions was to impact Russia's economy. Remember whole 'ruble is rubble' thing? The IMF expects Russia's economy to see net growth this year [1] after seeing a total decline of -2.1% last year. Their inflation rate is currently 7%, expected to hit 4.6% by the end of the year.

As for oil prices, it's important to remember that oil prices before the war were very high, and they got even higher in the early parts of it. In February 21, 2022 (the invasion was on the 24th) prices were at $90/barrel. They hadn't been that high since 2014. [2] So it's easy to be somewhat misled just considering before/after scenarios.

[1] - https://www.imf.org/en/Countries/RUS

[2] - https://tradingeconomics.com/commodity/crude-oil

I think it’s entirely fair to suggest the sanctions did not achieve their desired goals.

I think it’s an entirely different thing to suggest it did “nothing”.

Oil revenues are off 45%. Its GDP was down 2% in 2022 while the thing it exports was up. Saudi Arabia’s and the UAE GDP set a record over the same time period as a point of reference. The OECD and World Bank anticipate GDP shrinkage this year as well.

The ruble is at its lowest point in 20 years (if you remove the war shock). Thats even with the heroic activity of their central bank last year and current capital flight restrictions. Their sovereign wealth fund holds 16% less today than it did before the sanctions, because its being used to backstop the currency.

The IMF is using the countries' own claims and numbers for their calculations. Russia's own economic numbers have been unreliable since Covid hit and blatantly cooked up since the February 2022 invasion of Ukraine.

This paper gives a more correct view on the dire state of the Russian economy:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4167193

That article is almost a year old now. Where's the collapse?

In just about every one of their industries...

A fair part of Russian economic 'growth' is in military supplies. When you are attacking another country and looking at almost no gains in the end this is a disaster of epic levels. If you have a gain in the end you can justify the expense in the revenue from the spoils you captured.

At it's current rate Russia is looking like it will get none of that. It will not gain any new territory. It will lose massive amounts of equipment and personnel directly. It has lost massive numbers of better off people that left the country. This is a demographic and economic nightmare, that keeps getting worse when you look at the preconditions.

Before the war Russia was making huge amounts selling natural resources, but was already running into problems funding its retirement (something Putin said he'd never touch when he was first elected). Well in the past few years Putin did have to raise the retirement age and tried to reduce the retirement benefits which was causing massive problems internally. Now that problem is even worse and puts Russia at risk of complete internal collapse.

You can take a stroll about Moscow anytime you fancy. Search a video site for something like "прогулка по москве 2023". That simply means 'a walk around Moscow 2023.' Here's [1] one from 5 days ago. One could describe what you see in many ways, but a complete economic collapse is probably not one of them.

As for the war, look at the leaks; you're expected to. That's why they're not being given the Twitter Files treatment. There was a conscious decision to cover them and regularly emphasize points such as the predictions for Ukraine's counter offensive. Watch how the media narrative on Ukraine is (and will continue to) suddenly shift. We seem to be hitting that 'lab leak' "messaging" inflection point with Ukraine. The Washington Post is now even running an opinion piece suggesting NATO could bypass Ukraine and directly negotiate with Russia, making some substantial concessions, in an effort to try to end the war.

The problem with pensions is mostly about fertility. Like most of the developed world, Russia's fertility rate is abysmal. So you have an ever-growing group of older individuals who are supposed to be supported by an ever smaller group of younger individuals. It's the reason retirement ages are going up everywhere. Russia increased theirs from 60 to 65. In the US and Norway full retirement is 67, France just bumped theirs from 62 to 64, and so on. In low fertility countries, rich and poor alike, expect retirement age to gradually approach life expectancy. A sub-replacement fertility means there is no equilibrium point. Your youth population is constantly shrinking, and trending towards zero. Of course bloody wars aren't helping on this front.

[1] - https://www.youtube.com/watch?v=9tD1crjaeYQ

[2] - https://www.washingtonpost.com/opinions/2023/04/19/nato-coul...

The sanctions didn’t fail. They probably complicated the oil transport logistics a lot. There’s been stories of how uninsured Russian tankers offload oil bear Gibraltar. Then the oil goes somewhere in China(or India). I suppose it’s going to find its way back to Europe as “Indian diesel”.

So, exactly as you describe. But all of this should add costs even if the crude oil prices are at the proposed ceiling.

Who lost? Russia and the EU. But who said that wasn’t the plan.

It's been a year, where is this collapse of the Russian economy? It looks like they're doing just fine and can continue to wage war near indefinitely. What are the sanctions even doing at this point??

The sanctions were supposed to sever the ties between Russia and the EU. That worked perfectly. Same as the refugee crisis. The two most active supporters of Ukraine(USA and UK) take almost no refugees from Ukraine. It’s the EU that suffers from having to support them.

What? The US has taken an enormous amount of Ukraine refugees: https://www.nbcnews.com/politics/immigration/us-admits-27100...

271,000! That's over double their goal of 100k! They explicitly got rid of refugee restrictions put in place at the start of the pandemic so they could let in Ukraine refugees.

Bulgaria, Romania, Slovakia combined took twice more than that. 271k is nothing for US given their role in the conflict.

Those countries are next door to Ukraine, a refugee can literally walk to them vs. someone paying for a plane flight to the US. Of course neighboring countries will have more refugees...

A refugee can pay literally 200 EUR and fly to US from Warsaw. I assure you many paid up to two orders of magnitude more just to flee the county.

It’s about the local laws put in place. The EU takes refugees with almost no preconditions. Maybe that’s why the EU leaders try to come up with a peace plan once in a while, unlike UK or US.

"given their role in the conflict" is pretty ambiguous, if you're referring to russia's war on, and latest genocide of, Ukraine

could you elaborate on what role you're speaking of, and why you personally think it makes the admittances below your standards?

Go bait somewhere else, mate. Your question has nothing to do with the topic we’re discussing.

your post would be a good response to yourself mate, as your opinion of the US's "role in the conflict" has nothing to do with the topic we're discussing and seems to be bait

You’re free to just walk past by. Nobody forced you to respond.

that seems like it would be a good response to this post you made after yourself baiting and deflecting from the topic we were discussing, mate:

https://news.ycombinator.com/item?id=35643805

The Russian economy absolutely cratered when sanctions were rolled out. What are you talking about?

https://tradingeconomics.com/russia/stock-market

https://www.consilium.europa.eu/en/infographics/impact-sanct...

Russia has bounced back and are continuing to wage war just fine despite the sanctions. What is the point of them now?

I don't think Russia has "bounced back." And coloring their war-making ability as "just fine" erases all differentiation in cost and effectiveness caused by sanctions.

> What is the point of them now?

I mean, I think they still impose cost and hinder Russia's war-making ability. So it's good to keep them if you like that impact?

You have also moved the goalposts some from upthread[1]:

> The sanctions have failed to do anything.

[1]: https://news.ycombinator.com/item?id=35628560

Sanctions are greatly increasing the cost of the war to Russia, and reducing their industrial capacity to wage it. Their rate of shelling as been falling steadily, and they are losing armoured vehicles at twice their replacement rate. Their spring offensive was so futile there was actually a lot of confusion about whether they actually launched it yet. They had, and it got massacred.

Easing sanctions would greatly increase the rate at which they could produce military equipment, particularly high tech guided munitions. That would equal more dead Ukrainians.

>just fine

Whaaa? Russia is sending T-55s to their front to deal with massive material losses. The losses are closer to the numbers we'd expect in WWII, not a local border war where they are the attacker.

You are watching Putin fight to keep alive (note, not keep Russia alive) at this point. Bakmut will go down in history has Putin's mad king moment.

Russia has $75T in known resource reserves. The US is second at $45T.

Do you really think Russia can't afford to insure oil tankers if the West refuses to do it?

It's not about "afford" (insurance is, after all, a profit-generating business), it's about being able to.

They have the resources to make their own insurance company.

The question is, will this company be recognized by all required players (ports, authorities etc.). If you're insuring something worth hundreds of millions of dollars, you really want the insurance company to meet certain standards, and have a good reputation of paying out. Can Russian achieve that? Probably. Can they do it quickly? That sounds much trickier.

If Russia doesn't back its insurance it loses credibility around the world.

Russia is a major player in the oil world. It has the relationships and experience to manage this.

Russia is massively underdeveloped. It would take a few trillion dollars in funding just to extract a relatively small fraction of those known resources. They are also massively under populated. They do not have the financial nor the human capital to even extract a 1/10th of that wealth in their current state.

China had invested a lot in Russia in the Belt and Roads initiative to extract natural resources, and it is looking like Russia will default on those loans.

While partially true, you would still expect cost increases from oil flowing through China and India.

I believe Russia is also a major fertilizer exporter and nitrogen fertilizers have more or less doubled in price

Nitrogen fertilizer is made from natural gas, so maybe the nitrogen fertilizer plants in the EU were shut down to ensure adequate supplies for the EU's more inelastic demands for natural gas.

(More precisely, the natural gas is a cheap source of hydrogen atoms that get combined with nitrogen in the air to produce the fertilizer.)

There is no maybe, several fertilizer plants in the EU did shut down due to gas costs. And both Russia and Belarus are very important agriculture input exporters.

Not only failed, but backfired. All these Russia/China/India deals is the result of the sanctions. Heck, even Japan is now ignoring the price thresholds and buys from Russia.

Yup, and no one is paying for oil in dollars anymore. The global value of the dollar is going to be destroyed over time. It's really breathtaking how quickly the west has decided to shoot itself in the foot with nothing to show for it.

Cite your sources for the claim that “no one is paying for oil in dollars anymore”

The West has stood up to a blatant land-grab invasion and has armed Ukrainians with the means to defend themselves effectively. Decimating the Russian military without firing a shot is objectively a NATO victory, regardless of the ultimate outcome.

the ham-fisted SWIFT ban was the real mistake and that is what's driving countries away from the dollar more than anything. Removing Russia from SWIFT was the financial equivalent of launching nukes and will be seen as a major mistake long term

China's competitor to SWIFT has doubled in transaction volume since the sanctions and is growing fast - https://www.ft.com/content/6d5bbdbc-9f5d-41b2-ba80-7d8ac3973...

Russia’s economy is smaller and less diverse than the state of New York. People treat Russia as a near-peer when they are in reality a backwater gas station strapped to a cold-war era nuclear triad. The fact that their military can’t defeat ukraine is absolutely baffling, but indicative of how rotten that country has become.

Cutting them off from SWIFT isn’t a nuke in the new financial Cold War. It’s the consequence of the path Russia chose when they started this incredibly stupid invasion.

Framing western reactions to Russian stupidity as “the real mistake” shows that you aren’t paying enough attention. The US threw down the gauntlet against an unimportant Russian invasion to ensure China gets the message that the United States is ready for economic warfare over Taiwan. If that action decreases the likelihood of invasion by just 10-20%, it’s certainly worthwhile.

The Yuan has lost 7% of it's value against the Dollar in the last 3 months. The fact is the Dollar is incredibly strong, it's up over 6% on a year ago. Yes trade in marginal currencies like the Yuan is up because Russia is desperate, they will trade in anything right now, but this is all small change. It's easy to double transactions when they start from such a pitifully small level to start with. Demand for dollars is as high today as ever.

China regularly devalues the Yuan because they want it weaker to boost exports

Russia _has_ to use the yuan but that’s a far cry from “everyone”.

China just paid for their first boat of yuan settled LG on the open market 20 days ago. After 6 years of offering it on their exchange. Their meeting with the Saudi’s last month came with non-committal statements, again, 6 years after they first started.

I think the yuan becoming more involved in the energy trade is inevitable, they are the largest energy importer in the world and a major economy. It may have even been accelerated by the sanctions on Iran and Russia. But to say that “no one is paying for oil in dollars anymore” is a ludicrous statement (probably one that comes from the posters hopes not the facts).

And adding the petroyuan to the mix is more dangerous to the Chinese currency than to the dollar. It immediately becomes imminently arbitrage-able in ways it can’t be currently due to currency controls. The Chinese government has been de-liberalizing their currency because they are worried what the markets will do to it.

That’s not to mention their treasury exposure, trade surpluses and the Middle Eastern states currency pegs.

A de-dollarization of the energy market will make it less efficient and may cause some rebalancing of currency reserves, but it will drive all settlement currencies to free market parity which is good for western currencies and bad for Chinese and Russian ones.

I agree that "no one is paying for oil in dollars anymore" is an overblown statement. However, the de-dollarization process was started in 2014 and will keep getting stronger. This matches the recent leaks (as well as the video confirmation by François Hollande - the former President of France), that the 2014 coup in Ukraine was staged and sponsored by the US. As a Ukrainian, I tend to believe that a good portion of the conflict between Russia and Ukraine is driven by the de-dollarization fears of the US. The global superpower country is basically losing its main leverage, which is, in my personal opinion, a huge deal.

While the mainstream media keeps it all super positive, I think the US did a lot of miscalculations within the past several years. And honestly, something tells me that Putin will outplay them all. The guy is extremely smart and it's foolish to downplay him and say he is not. We shall see.

I’m not going to comment on your other opinions as I don’t have relevant experience. But de-dollarization was a common refrain in my field (finance) going back to before I was involved in it (2001).

I’ve seen everything from Nixon in China to the current Russian sanctions being used as reasons for it. I suspect the real reason it will happen is that people can make more money trading in yuan (or rupee) than in usd. Sadly, Russia and Ukraine just aren’t important enough to make a dent.

My personal opinion is that the dollar is the reserve currency (and thus the petro currency) is due to much less conspiratorial reasons. It spends all over the world. It isn’t debased frequently and it isn’t volatile.

China could introduce a currency that had all those properties tomorrow. That they haven’t is an indictment of using the yuan as a reserve currency. It would take a significant change to Chinese economics to make that true.

But! If China did that it wouldn’t save Russia. Modern currencies hate autocracy and despotism because it runs counter to their premise. It doesn’t help Russia for China to liberalize, the only thing that helps them is their own liberalization.

Thanks for the common sense response.

> My personal opinion is that the dollar is the reserve currency (and thus the petro currency) is due to much less conspiratorial reasons.

Agreed. There is zero conspiracy around that, which is why I believe the US loosing the natural power of the Dollar is a logical fear.

> It would take a significant change to Chinese economics to make that true.

..which is what BRICS aiming for? If that is one of their goals, nothing is going to stop them. And honestly, that's a good goal to have. Putting all the negative narrative around Russia/China aside and abstracting away from the US, why should a single country's currency dominate over the entire world? That's simply not fair.

> If China did that it wouldn’t save Russia

I somewhat disagree. Russia is not looking to be saved by anyone. Putin's interest is a mutually beneficial partnership. He's a businessman. He's cool with yuan (or any other currency) being the new reserve currency. On the other hand, he is not cool with the US pushing to be the superpower dictating the rules, which obviously goes against the United States' goals and ambitions. I could be wrong, but that's my understanding of things.

BRICS is not some counter balance to the US petro dollar. It is at best a coffee claque of countries with the most currency controls of any major economies and at worse a Chinese op to make the yuan more powerful. But the problem is that none of the BRICS nations want a market currency! They want a less dominant USD (which I personally think is understandable but short sighted) but they haven’t offered a viable alternative.

That is to say they each want their own currency to be as valuable as USD but haven’t done the things it would take to make that happen.

I don’t think it is “fair” that the USD is dominant but I think that oil settlement in other currencies is much less detrimental to USD than many people think. Again, if you can settle oil in your currency, you’ve effectively put it in competition with USD. The Chinese government has been fighting that outcome for as long as there has been modern Chinese currency, and frankly every other currency besides INR doesn’t matter for this conversation and INR also has been very controlled.

People seem to have it backwards. Global trade attaches to liberal currencies because that’s good for global trade. The US has the most liberal currency of all time (and the most liberal currency currently even with Russian sanctions) and that makes it the petro currency. If the yuan or the rupee liberalize enough to take over the petro trade then there won’t be much impact on usd but if they don’t then market forces will hurt them more than the US.

The thing that might cause a USD fall is a default on usd debt or the us becoming more conservative on their currency controls but there is so far to go on that compared to their comps it’s hard to extrapolate.

I don’t have opinions on Putins desires, it’s outside of my understanding. But picking the Chinese in a relationship where they have more powers than the previous relationship with Europe seems crazy to me. But international politics is not my sphere.

Appreciate your comments, Kasey, and thanks for the detailed response.

Off-topic: the link in your profile is no longer available.

It's getting hard to keep taking what you're posting here seriously. It's so wildly over the horizon from reality, it's hard to see the point of replying.

There is zero threat to the dollar. Demand for dollars is higher than ever, and it's still the primary currency for the oil trade, and pretty much any international trade. The recent economic instability has, as always happens, lead investors to flee to stability. That's the dollar, which is why it's up 6.6% over the last year.

What we have to show for the last year is utterly humiliating the Russian military, successfully helping Ukraine repel an assault on their capital, and push back the Russian army twice since in significant territorial losses. The west has never been more united, NATO is stronger than ever. The AUKUS pact and US-European alignment on Taiwan has solidified, despite typical French squirming, but they'll come around. They always do.

It's not like the economic picture is all roses, far from it, but that was happening already. The main achievement is that the fantasies Putin had of rolling back NATO are dead in a ditch, and I think the chances of a Chinese attack on Taiwan in the coming decade are half or less what they were a year ago.

Cutting off Russian oil completely was never the plan, it would have lead to an extremely damaging spike in oil prices that would have hurt everybody. Rather, the objective was to keep Russian oil flowing, while dramatically reducing the extent to which Russia profits from it.

This has worked, the prices Russia is getting for their oil are single digit dollars above their production costs, which are going up due to sanctions, while global oil prices remained fairly stable.

India and such buying cheap Russian oil is an intended outcome, not a problem. Good for them. It also helps that India is processing this oil into value-add exports that are pricing out Russian alternatives.

Sorry that is taking the goal posts, strapping them to a Saturn V and blasting it to the far side of the moon. The rhetoric a year ago when sanctions started was to turn the "ruble to rubble" and stop Russia's ability to wage war. This has failed spectacularly in my view. The sanctions have done nothing but cause pain on every country except Russia. Russia is still waging war effectively and appears to have no signs of stopping.

Here's an actual quote: “The price cap is specifically designed to reduce Russian revenues and Russia’s ability to fund its war of aggression whilst limiting the impact of Russia ́s war on global energy prices, particularly for low and middle-income countries,” - Joint statement by G7 finance ministers.

A lot of breathless headlines got published early on by non-specialist journalists that have never had to cover anything like this, but nobody who actually understands the history and practice of sanctions in the modern era believed they would actually bring Russia to their knees any time soon. Read any of the coverage of these sanctions in The Economist from last year.

North Korea has been under far more severe sanctions for generations and has even managed to develop nuclear weapons. Iran came under similarly severe sanctions and they're still a credible regional threat. The idea that Russia, a nuclear state with massive foreign reserves to draw on, even aside from the ones frozen in the west, would be beggared in a matter of months was always absurd. Sanctions have never in the modern era actually forced a state to capitulate.

Wiping out on the order of 85% of Russia's oil profits while maintaining global prices is a major success. Yes Russian oil is still flowing, but the profits are now disproportionately going to countries outside Russia, like India. They're not suffering from the sanctions, they're making a killing Good for them. Even if you don't believe that this was the stated goal, though as you can see from the quote I opened with it was the actual stated goal, it's still obviously what's actually happened.

I believe the fuel being referred to is natural gas, much of which has historically come from Russia.

Who said that Tanks in Ukraine are the main drivers to oil price increases?

The person I'm directly replying to said the war in Ukraine is causing oil prices to increase. What else would be using major amounts of oil in a war?

But like I said it's beside the point. The price of oil is effectively set by the production volume of Saudi Arabia. Ukraine does not factor into it at all.

I'd argue that there is shitton of logistics around war which requires a lot of transportation

Russia is a major oil exporter ~10 million barrels per day, and they are impacted by the war.

Their exports are humming along just fine as they've made new agreements with China and other countries to get out of the petro-dollar hegemony. It's been over a year and the sanctions against Russian oil exports appear to have done nothing.

If I posted as frequently within the short amount of time as you have on this topic, my account would have been throttled. My account is frequently throttled for posting more than 5-7 times per hour, and yet, your recent history shows a far higher rate of posts in defense of Russia with no evidence of throttling.

That's very interesting. I wonder if limits are relaxed above 8k karma.

I also wonder why what is basically Russian propaganda account has no limits and how it got to 8k karma, when it has basically nothing to say.

I know there is practice of buying established accounts with bunch of karma / followers to use for both marketing and propaganda purposes so that might be this case.

Respectfully, you are delusional if you think I've been on HN for years, posting in lots of unrelated threads, etc. to be some apparatus of Russian propaganda.

It's time to realize real, normal people are fed up with this useless conflict. That's the takeaway here that you refuse to see.

I know some people want Russia to win, and they are real. They are either ignorant or they are horrible and evil people.

Yes, people who don't think like you do are horrible human beings.

"Everyone who disagrees with my point of view must be ignorant or evil" is a terrible argument and only strengthens his point.

What a juvenile and reductive way to view people and relationships. Have you ever self-reflected and considered maybe you might be wrong about anything, ever? Have you ever extended any generosity of argument?

How about people are genuinely tired of the bs.

We are talking about genocidal war where the first thing the occupiers establish in occupied territories are torture rooms. Just last week, Russian soldiers admited on camera they had orders to murder children and went along with it.

What kind of self reflection would make people who are ok with that not complete filth I wonder?

Maybe some people don't realize that russian soldiers rape, torture, and murder men, women, elderly, children, in areas of Ukraine they control (as confirmed by UN war crimes investigations)?

Maybe these people are simply okay with that happening because they are 'tired'?

>"My account is frequently throttled for posting more than 5-7 times per hour"

Same here.

Possible answer: https://news.ycombinator.com/item?id=29718710

I'm an American that's fed up with the continued support of sanctions and this useless war in Ukraine. We have flushed billions of dollars into this conflict and enacted pain on the world for zero gain. It's time for the west to admit failure on this and push Ukraine to bargain for a cease fire, even if it costs them contested territory like Crimea or Donbas. The history of conflict in those regions is quite complicated and zero concern for the US--we have far bigger problems at home to worry about.

Your biggest adversary, one that's cast a dark shadow over your country and it's allies, one that's consumed trillions of dollars of defence spending over the last 75 years, is now being ground down and exhausted with approximately zero of your countrymen's lives at risk and all for a mere few billion dollars. You're getting a bargain.

The USSR was a major adversary for roughly 45 years, 1946 to 1991. The US provided them major economic aid in WWII which they leveraged into a massive expansion and had minimal interaction before the war.

Russia is a politically distinct fragment of that empire, just like Ukraine.

Indeed “glavniy protivnik/glavniy vrag” is what USSR used to call USA!

Nope. It wasn't. It was the most likely adversary. Вероятный.

Ok “probable adversary” I stand corrected. I thought that one was a joke.

This war is catastrophic to Ukraine, but relatively costs pennies to western countries. They absolutely should continue armaments as long as Ukraine is willing to fight. Not doing so would mean allowing fascism and outright genocide to spread on European soil, and that would have an astronomical cost in the long run.

US and EU would be very, very shortsighted with their own interests if they didn't ship everything Ukraine wants.

Well, Ukr really wants foreign soldiers on the front line. Please tell me you're already there, or else I might suspect you're rooting for Putin!

The best response I've heard to this is: Tell me which part of the US you would willingly give up to Russia if it threatened to attack. If your response would be for them to pound sand, why should we expect or want any different for the Ukraine?

The US doesn't launch artillery into its own states like Texas for example. This is why I say the history of conflict in Crimea, Donbas, etc. is complicated--Ukraine government for years has done much aggression against ostensibly its own people (including firing on them with artillery!).

This is not a cut and dry, "Russia bad!! Russia invade!!". Some people in those contested regions welcomed Russia as protectors against Ukraine extremist aggressors.

As an American I have no skin in this fight and nor should I, this is a conflict for Ukraine and Russia to sort out hopefully through diplomacy. Russia has been a world power for decades post USSR fall and clearly have not been on a megalomaniacal quest for world domination. I see no reason to assume they want to start another world war.

The US most certainly has launched artillery into its own states, including Texas [1]. There's no benefit to doing so now, but if Mexico were to occupy all of Texas tomorrow, I guarantee the US would bomb inside Texas. Similarly, if Mexico just supplied support to get Texas to secede, there would also be violence.

[1] https://en.wikipedia.org/wiki/American_Civil_War

The southern states started the civil war in protest against moves to end slavery which they profited from directly. It was not northern states deciding to be aggressors against the southern states for no good reason. The circumstances were completely different and you know it (it's in the wikipedia article you cite!).

It’s a lot more complicated than that as the Wikipedia page mentions. The southern states had ‘succeeded’ months before fighting broke out. Lincoln made some concessions but wasn’t willing to relinquish federal land in southern states or accept them having actually left. Meanwhile congress passed many new laws once southern state senators had left.

the history may be complicated, and that's why it's up to the UN, or bilateral negotiation between russia and Ukraine, to resolve the issue, rather than russia using force and trying to genocide Ukraine because russia is mad they don't get everything they want

indeed, as soon as russia abandoned the former, diplomacy, and resorted to the latter, force, they lost all benefit of the doubt and all rights to anything they wanted

and that's to say nothing of the fact that russian soldiers rape, torture, and murder men, women, and children in areas of Ukraine they control, so ceding control means allowing that to happen, which obviously means it wouldn't actually lead to peace, because who would be peaceful sacrificing THEIR friends, family, and countrypeople to that? You?

Mine got throttled too. @dang picks his favourites as he likes. Think of that whatever you want.

But the price of oil and gas is still up in Europe.

In the UK I was filling up the other day and reflecting how I'd being paying the exact same price 10 years ago.

My current car costs me 15p/mile to drive. Back in 2000 I remember it was costing me about 13p/mile -- that was in a car with worse mpg, but either way it feels it's never been cheaper to drive in the UK.

In 2004 it was 80p a litre, or £1.57 in today's money [1]. I filled up for well under £1.49 - I don't recall exactly.

In 2008 petrol peaked at £1.20 or £2.05 in today's money, about the same peak as last year's £1.90 a litre.

In real terms petrol today is well below 2018 levels

[0] https://www.racfoundation.org/data/uk-pump-prices-over-time

[1] https://www.in2013dollars.com/uk/inflation/2004?amount=80

I wouldn't be surprised if it's also overlapping long tails of everything: from COVID global trade and shipping disruptions to war in Ukraine affecting grain shipments to rising fuel prices to...

"Climate change" is probably the long tail of everything you could add to the list. The flooding in Pakistan in 2022 for example. Remember that one? It destroyed crops and then there's the draining and fixing the land afterwards, infrastructure damage making planting for the next season more difficult, and so on. Pakistan was the 3rd global exporter of rice after India and Thailand in 2021.

Let's not forget natural gas is the main source of methane used to make synthetic fertilizers. Since Russian natural gas isn't flowing the way it used to, I can imagine that would increase the price of food.

Ukraine isn't called the breadbasket of europe for no reason. It's hard to grow crops for export when you're at war.

Still only responsible for 3% of global production, and there are bigger European producers:

https://www.weforum.org/agenda/2022/08/top-10-countries-prod...

Wouldn't it make sense to combine Ukraine with Russia given the sanctions?

No, because Russia has enough willing buyers for its production.

Didn't Poland decide they didn't actually need Ukraine's grain and it's just sitting in ports rotting? https://www.cnn.com/2023/04/16/europe/poland-bans-grain-ukra...

Doesn't seem like there is much demand for Ukraine grain.

> Doesn't seem like there is much demand for Ukraine grain.

Always with the disinformation.

Ukraine's main exports for grain are obviously not in Europe. https://oec.world/en/profile/country/ukr/

> Always with the disinformation.

There is no need for accusations like this. There is a grain glut in Europe to the extent that Poland and other countries are closing their borders to imports (I think it has something to do with the fact that's it's difficult ship over the black sea due to obvious reasons and the land routes are lacking in capacity).

https://www.theguardian.com/world/2023/apr/17/slovakia-joins...

Yes, exactly. There's large need for Ukrainian grain elsewhere, but export via sea routes is obviously very hard with the war going on. My comment was about the parent trying to twist this to mean there's no demand for the grain, which obviously isn't true.

Export would include sea exports of course. Where's the misinformation?

I don't get your point about exports, I think there's some misunderstanding? Misinformation in this case is to claim there's no demand for Ukrainian grain.

But misinformation is rife in the whole discussion and most others in the same topic. As soon as anything about Russia is discussed, we get a spirited comment section telling how well Russia is doing, how West is failing, and how Ukraine would be better off by just voluntarily ceding its lands that actually belonged to Russia all this time anyway.

> and the land routes are lacking in capacity

It's the costs of transporting the same amount by land. Bulk carrier takes ~50000t, you need ~2500 long semis to haul this amount at best. Include the gas, drivers salary etc.

Just an aside but wheat grain lasts basically forever so it's not exactly rotting.

But the problem now is that there is way too much grain in Europe to the extent that neighboring countries are banning imports from Ukraine to protect their farmers...

> Is that legitimate, or is that just timely excuse making?

Arguably[1] a bit of both.

[1] https://scholarworks.umass.edu/econ_workingpaper/343/

So there's a big long video by Petar Zeihan at the Iowa Pork Conference but the TL;DR is that the Ukraine and Russia are 2 or the world's 3 leading producers of nitrogen.

This is a critical component of fertilizer. Because of fertilizer we weren't just able to make land good for crops better for crops we were able to make land that was marginal for crops good for crops.

Because of this we could farm a lot more land; however with less fertilizer suddenly that land can't be farmed. What this means is less arable land = less food.

As a result the supply decreases while demand increases, leading to a price increase.

So yes it is a real excuse, and the problem is that many nations in the world import more than 50% of their calories and almost no nations on earth are calorically self sufficient.

It is not the war, it's the sanctions package engineered by an incompetent US/NATO that create more harm to the world than the war itself.

Refusing to sanction an aggressive nation empowers that nation to continue its aggression.

Sanctions can be painful in the short term, sure, but they're a necessary evil. They heavily disincentivize violence without the need for more violence.

War is arguably the greatest source of human suffering in history.

Can you name one time in history where sanctions have actually worked?

Sanctions are not designed to change the regime. Look at the French president complaining how it’s “not fair” the the US seize the moment to lure European manufacturers to the USA.

The Iranian nuclear deal, until some stable genius ripped it appart.

It definitely put pressure on Rhodesia and South Africa, both of which eventually experienced regime change.

No idea about Rhodesia but for SA I think it was mainly doing of ANC

I would agree for Rhodesia. They became much like an island with the outsiders making sure that the authoritarian Mugabe had the stage to enter so he could flush the whites from the farm so foodstuffs would evaporate and hyperinflation set in.

I almost wonder if racists in SA and Anglo nations set the stage for sanctions so Mugabe could rise so the blacks could starve. They knew the food supply was safer under direction of Rhodesian regime.

Cast your mind back to WW2, where the Allies' sanction of Japan basically set the wheels in motion for their collapse.

Impressive how absolutely no evidence is given by such a massive claim.

At least attempt to refute the article which makes multiple separate claims as to why there is a shortage.

The supply is obvious, but the wise/stupid judgement is still up for debate.

https://www.npr.org/2022/09/28/1125525861/how-the-war-in-ukr...

Can't obliterate even the tiny Russian economy without some knock-on effects on the rest of the world.

Between Russia and Ukraine, they produce some vital materials including lots of fertilizer, despite making almost no money. So while we're all taking a small financial hit right now, there are odd things like this as well.

> Can't obliterate even the tiny Russian economy without some knock-on effects on the rest of the world.

Maybe the GDP isn’t the best and only measure then.

I'm partial to total net worth measurements, but in case of war, you have to take into account things like scarce materials and growing seasons of crops.

Like how in Age of Empires you had gold as well as wood and food, if memory serves.

What a selfish take.

Yes, a selfish take from some IT guy making significantly more $$ than the average Brit or EU citizen. It's nice to be insulated from the rising COL bc you can lecture others from the safety of your home.

We pay good money for that home to be safe, something Europeans constantly chide us for. Maybe Europe shouldn't have been relying on cheap resources.

We? As in the US?

The oceans keep us safe. The money we spend is to maintain hegemony.

Are you sure its just the oceans and not the massive navy we have in them?

Aircraft carriers are basically by definition not defensive.

A navy is an effective mobile border when you don't have a Hawaii everywhere. It's easier to defend your castle when your first wall is 2000 miles from your natural border.

Plus the best defense is a good offense. Nukes aren't a defensive weapon and yet they're an effective deterrent.

Yes. Invasion is basically logistically impossible without the assistance of Canada or Mexico, and with their assistance, would require a large, obvious, and vulnerable preparation lasting at least many months.

Of course our having a navy is a good idea. I'm obviously (and I think you know this) not advocating complete disarmament. We probably don't need a navy large enough to project force to the literal other side of the world in multiple places at the same time, though. Nor a standing army large enough to invade and occupy 2+ weaker countries at the same time.

The vast majority of our military spending is about hegemony maintenance and the ability to impose our will around the world, not defending ourselves. Our oceans do in fact put us on easy mode, for simply defending ourselves—we don't need the world's strongest military to do it.

Well, since EU is most definitely NOT safe from Russia I'd say you either don't pay enough or the money's squandered on something else.

EU's safety is the EU's problem. It has long been underinvesting in security hoping that the US would be its bodyguard. Time to see how little money you have left over for social safety nets when you're not buying cheap resources from the same enemy you need protection from.

If EU's safety is its problem then why are we not allowed to take an independent stance in any matter? As to the cheap resources, I'm sorry we didn't invade Iraq, Libia, Syria to get oil for pennies. The EU bought at market price from Russia, what's your point? Was US oil cheaper and we said no?

>If EU's safety is its problem then why are we not allowed to take an independent stance in any matter?

The EU pushed for sanctions just as much as the US did, you just don't like the outcome.

>As to the cheap resources, I'm sorry we didn't invade Iraq, Libia, Syria to get oil for pennies.

Well, first, you need a military to be able to do that. Second, we don't get oil for pennies anymore but we're not under existential crisis as to the future of cost of living.

>The EU bought at market price from Russia, what's your point?

You built a dependence on a country you're now scared of and that manages to get by without your money and that was a strategic mistake. The US has and is making a similar mistake with China. If the China situation pops off, it'll be the same thing here (and Europe is going to feel the pain of that because it's reliant on China for cheap tchotchkes too).

The US has plenty of useful idiots in positions of power in the EU, yes. They knew precisely what sanctions meant for the populace but went ahead anyway.

As to the military I'd like to refer you to this: https://www.politico.eu/article/europe-nato-problem-defense-...

A couple of quotes:

"Opposition comes not only from the U.S., which despite Trump’s browbeating of allies to spend more, is intent on preserving a 70-year-old framework that lets Washington call the shots and put its interests first."

"Under the guise of avoiding “duplication” and demanding “complementary” capabilities, the U.S. and NATO’s political leaders continue to put up strong resistance to the EU ever developing the command-and-control capabilities that would allow it to operate outside of the alliance’s existing umbrella."

At least on the China situation we seem to agree...

I can buy you a ticket to Ukraine so you can check yourself if this is actually more harm or maybe less

I agree. I'll gladly help buy OP a ticket to Ukraine. Those of us that have family who have died in this war and others who are still suffering are more than proof that the cost of this war has a far greater toll on humanity than short term price increases. And, yes, I say that fully aware that economics impact and starve other humans, too. But lets remember who STARTED this war, and that the world has a moral obligation to do anything it can short of obliterating the earth with nuclear war to stop it and deter it.

Why would "the world" have any moral obligations? And why would the citizens of EU&UK have to suffer more than say those of US, AU, NZ, SK and so on?

Why does everyone have to suffer from what happens in your backyard?

Nobody has to suffer, it's just that the sanctions don't work as intended and need to be lifted. Find other ways to help Ukr, don't f*k EU over.

Sanctions do work, albeit not as well as everyone hoped.

I don't think they should be lifted until Russia reforms. Not even when the war is over, unless accompanied with a regime change that takes serious steps to undo the imperialism.

I think it's completely reasonable to expect Russia to get the same treatment as Iran and North Korea.

Who started the war? What year did it start?

I mean, 1/4 of the world's grain and fertilizer sources are now in a war zone. It would take some hubris to assume we weren't going to feel that in some way.

War in Ukraine is being used by politicians all across the world to distract from their own fuck-ups, power grab, infringement on freedoms etc. etc.

Across the EU at least, margins of big-box retailers have gone through the roof. So producers are shafted because fuel and fertilisers are crazy expensive, and consumers are shafted because prices are going through the roof much faster than wages. The middle-man with enough bargaining power to effectively dictate purchasing prices to producers absorbs all the profit, using "the inflation" as a marketing cover.