Russia blockading CPC exports again?
A Moscow car bombing
Kazakhstan’s oil exports along the Caspian Pipeline Consortium, or CPC, are experiencing disruptions again, for the fourth time this year. There’s strong circumstantial evidence that Moscow sabotaged the CPC, again: the Kremlin has an interest in keeping consumer fuel prices high, particularly over the next few months; Russian security services presumably have the capability to pull off the operation; Moscow may have needed to employ plausible deniability, due to potential tensions with China over any additional CPC outages; and Kazakhstani President Kassym-Jomart Tokayev announced a sudden visit to Moscow on the 18th, a day after the CPC problem was reportedly uncovered.
Darya Dugina, daughter of ultranationalist Alexander Dugin, was killed in a car bomb assassination on Saturday. Russian security forces claim to have solved the case already. They have accused a Ukrainian mother of carrying out the hit in Moscow, with her 12-year-old daughter in tow, then fleeing to Estonia via automobile. While the FSB’s claims can be dismissed, it’s far too early to draw any other conclusions from the incident. Car bombings are a dramatic, showy, and seemingly political expression of violence, but they were a not uncommon feature of Russian business disputes in the 1990s and even early 2000s (as this excellent Jamestown article from 2004 discusses).
Lastly, along with my coauthor, Amy Myers Jaffe, I’ve published an article in Politico Europe on how Europe can apply “reverse pressure” to Gazprom, which lacks an alternative market to Europe, particularly over the medium-term.
Table of Contents
1) CPC interrupted (blockaded?) again
2) Chinese responses to the CPC closure?
3) China-Russia military ties
4) Taiwan, Russia, PRC
5) Increasing alignment between PRC, Russian propaganda services
6) Authoritarian Political Influence Campaigns
7) Chinese and Russian economies
8) The Moscow car bombing
1) CPC interrupted (blockaded?) again
Caspian Pipeline Consortium (CPC) has suspended oil loadings from two of three single mooring points (SPM) at its Black Sea terminal Yuzhnaya Ozereyevka for inspections, two sources familiar with the loadings told Reuters.
Comment: Recommend reading this article in full. CPC suspended loadings on August 17th, two days before President Tokayev’s visit to see Putin in Sochi. Two weeks ago, Kazakhstan and Azerbaijan agreed to an oil deal for a small amount of crude volumes (30,000 barrels per day) transiting Azeri pipelines.
Kazakh President to Pay Visit to Russia, Azerbaijan – The Astana Times [August 18th]
Kazakh President Kassym-Jomart Tokayev will meet with President of Russia Vladimir Putin on Aug. 19 as part of the working visit to Sochi, reported the Akorda’s press service.
Comment: President Tokayev announced a sudden meeting with Putin a day after loadings were suspended.
Meeting with President of Kazakhstan Kassym-Jomart Tokayev – The Kremlin [August 19th]
President of Russia Vladimir Putin: Mr Tokayev, I am very happy to see you. Thank you for accepting our invitation. We meet regularly with you. We saw each other just recently, but decided to meet here, in Sochi. [Bolded by The Report] We have a lot of work ahead.
During the meeting, the heads of state thoroughly discussed topical issues of the multifaceted Kazakh-Russian strategic partnership. Particular attention was paid to strengthening trade, economic and investment cooperation.
Comment: For any Kazakhstani government officials reading this post: I strongly recommend that the Kazakhstani government regularly provide English-language updates of official proceedings.
Kazakhstan's CPC Blend loadings hampered by facility damage: operator – S&P Global Platts
Kazakhstan's CPC Blend crude oil is being loaded from just one of three single-point mooring systems at the Russian port of Novorossiisk after cracks were discovered in subsea equipment, the operator of the facility, which typically handles 1.4 million b/d, said Aug. 22.
Kazakh oil exports across Russia interrupted for fourth time this year – Eurasianet
An oil pipeline across southern Russia that carries the bulk of Kazakh crude exports has again limited shipments, threatening one of Kazakhstan’s most-important sources of hard currency and further fueling speculation that Moscow is deliberately punishing Nur-Sultan for not supporting its war on Ukraine.
Beijing is not on the West’s side in the Ukraine conflict. Yet even as tensions over Taiwan threaten cooperation, policymakers in China and the West should see that they have a shared interest in preserving Kazakh oil flows should Russia block exports again.
Comment: My colleague, Paddy Ryan, and I wrote this on August 11th, in anticipation of another forced outage. Russian security services may have chosen a more deniable mechanism to interrupt Kazakhstani shipments (and thus limiting the risks of a PRC reprisal); it’s also possible that the pipeline did indeed suffer from an accident. The former explanation seems much more likely, in my view.
2) Chinese responses to the CPC closure?
10,000 China-Europe freight train trips made in 2022 – People’s Daily
The number of China-Europe freight train trips in 2022 reached 10,000 on Sunday, 10 days earlier than last year, data from the China State Railway Group Co., Ltd. (China Railway) shows.
The trains have carried 972,000 twenty-foot equivalent units of goods this year, up 5 percent over a year ago, according to China Railway.
With 82 routes, the trains now reach 200 cities in 24 European countries, forming a transport network covering the whole of Europe. The trains transport more than 50,000 types of goods across 53 categories, such as automobiles and parts, clothing and accessories, and grain and timber.
China has made solid efforts to increase the transport capacity of the trains by upgrading domestic transport channels and coordinating infrastructure improvements with overseas railways.
In 2022, the average daily freight volume on the eastern route for the China-European freight train services surged 41.3 percent from 2020, and that of the western and central routes rose 20.7 percent and 15.2 percent, respectively.
Comment: This could be an oblique reference to the CPC closure (or not). As expected, the Chinese embassy in Kazakhstan and the People’s Daily have been quiet. China’s response will likely become clearer over the next week.
Russian, Kazakh presidents meet to strengthen ties – People’s Daily
Russian President Vladimir Putin held talks with visiting Kazakh President Kassym-Jomart Tokayev in Russia's Black Sea resort of Sochi on Friday.
"I am very glad that our meeting is certainly imparting an additional impetus to the development of our trust-based strategic partnership," Putin said in the meeting, according to a Kremlin press release.
Many events are planned to mark the 30th anniversary of Russia-Kazakhstan diplomatic relations in October, including joint military exercises, said Putin, who also praised the two countries' trade and economic relations.
"We have no reason to be pessimistic about the future of our cooperation ... I want to give more momentum to our bilateral cooperation in all areas," Tokayev said.
3) China-Russia military ties
China to send troops to Russia for 'Vostok' exercise - Reuters
Chinese troops will travel to Russia to take part in joint military exercises led by the host and including India, Belarus, Mongolia, Tajikistan and other countries, China's defence ministry said on Wednesday.
4) Taiwan, Russia, PRC
Putin says Pelosi’s Taiwan trip was a ‘thoroughly planned provocation – Joe Webster for SupChina
In an address to the 10th Moscow Conference on International Security, Vladimir Putin denounced U.S. House of Representatives Speaker Nancy Pelosi’s visit to Taiwan, saying, “The U.S. escapade toward Taiwan is not just a voyage by an irresponsible politician, but part of the purpose-oriented and deliberate U.S. strategy designed to destabilize the situation and sow chaos in the region and the world…We regard this as a thoroughly planned provocation.”
People's Daily Online, Moscow, August 10 (Reporter Rong Yi) On August 10, Ambassador Zhang Hanhui gave an exclusive interview to the Russian state news agency TASS on the visit of US House of Representatives Speaker Nancy Pelosi to Taiwan. The full text of the interview is as follows:
1. Mr. Ambassador, the US House of Representatives Speaker Nancy Pelosi recently disregarded China's repeated dissuasion from visiting Taiwan. What do you think of this incident? What impact will it have on Sino-US relations?
2. The U.S. government believes that the White House has repeatedly reiterated that the one-China policy of the United States has not changed, and that there is a precedent for the visit of the U.S. House of Representatives to Taiwan, so there is no need for China to make such a strong reaction. What do you think? (二、美国政府认为，白宫已多次重申美国的一个中国政策没有改变，且美众议长访台此前已有先例，中方没有必要做出如此强烈反应。您怎么看？)
Zhang Hanhui: The United States has always been good at being lenient with itself and being strict with others. It is also accustomed to pretending to be a moral judge and pointing fingers at other countries. It was a serious mistake when US House Speaker Gingrich visited Taiwan that year, and the Chinese government strongly opposed it at that time. The United States has no right or qualification to make the same mistakes again and cannot cover up mistakes with mistakes. Does the United States want to do all the bad and scandalous things it has done in history again?
美国一贯擅长宽于律己，严以待人，也习惯于以道德审判者自居，对别国指指点点。当年美众议长金里奇访台是一个严重错误，中国政府当时就予以强烈反对。美国没有任何权利和资格再犯同样错误，不能以错误掩盖错误。难道美国要把历史上干过的坏事、丑事都再做一遍吗？
Comment: Something I’ve noticed lately: Chinese state media and officials aren’t attempting to distinguish between the United States and the United States government – according to the CCP, apparently, both are irredeemable. Notice also that the TASS questioner clearly differentiates between the US government and the United States. Zhang either doesn’t grasp the distinction, or doesn’t believe there is one.
5) Increasing alignment between PRC, Russian propaganda services
Six reasons why Pelosi's visit to Taiwan is a mistake – People’s Daily
Democracy is a common value of humanity. It is an entitlement of people in all countries, not a prerogative of only a handful of countries. Whether a country is democratic or not can only be left to its own people to decide. It should not be subjected to the finger-pointing of some people from outside. Pelosi and some other American politicians, styling themselves as champions of "freedom, democracy and human rights", have defined other countries as a democracy or otherwise simply based on their own liking, and spun the "democracy versus autocracy" narrative in the international community. Their behavior is, in essence, an anachronism of the Cold War mentality and zero-sum mindset. It features the use of ideology and values as a tool to create confrontational blocs and advance a geopolitical agenda, for the purpose of protecting the vested institutional power of the US and other Western countries and defending Western-centrism and White Supremacy centering on Anglo-Saxon culture.
Comment: Echoes of Patrushev [Secretary of the Russian Security Council] in the line about “Anglo-Saxon culture,” although the Russian government is of course supporting white supremacist groups throughout the West.
As pointed out by American media, with the upcoming US midterm elections and a declining Democratic Party, Pelosi seeks to win political points by playing the "Taiwan card" and leave behind so-called political legacy. But "Pelosi's achievements in Taiwan are largely personal, symbolic and short-term." The regional security tensions thus caused, as well as other serious consequences, are to bring long-term impacts and inflict profound damage on China-US relations.
US Congresswoman Marjorie Taylor Greene censured Pelosi on Twitter, pointing out that Pelosi's going to Taiwan, putting so much under risk, is only for her husband Paul Pelosi to profit from his recent investment in the chip industry. "Americans have had enough with a woman obsessed with her own power she's held for decades while our ENTIRE COUNTRY CRUMBLES."
Greene's words do not come from nowhere. Recently, Pelosi and her husband have had repeated scandals and come under severe skepticism. Multiple pieces of media coverage in the US have revealed that Paul Pelosi, having become a prominent figure in the US stock market in recent years, is always able to make the right investment decision just ahead of the government's policy roll-out. In 2020, the couple's investment return was as high as 56 percent, compared to the legendary Warren Buffett's 26 percent during the same period. As a result, the Pelosi family's net worth is now over US$100 million. Before she went to Taiwan, when asked at a press conference "has your husband ever made a stock purchase or sale based on information he received from you", Pelosi was quick to deny and rushed to leave.
13 countries show interest in BRICS — China’s ambassador – TASS
Thirteen countries have shown an interest in BRICS (Brazil, Russia, India, China and South Africa) and they have put forward promising and strategic ideas for the group’s development in the future, Chinese Ambassador to Moscow Zhang Hanhui said in a special interview with TASS on Saturday.
Comment: More and more Chinese officials are getting front-page treatment from TASS (on at least its English-language section). While this is hard to quantify, TASS has been placing statements/interviews from Chinese officials on its front page nearly every day since around mid-March.
6) Authoritarian Political Influence Campaigns
Exclusive: Russia Backs Europe’s Far Right – NewLines Mag
Emails and documents show just how closely Italian, French, German and Austrian politicians coordinate with Moscow
7) Chinese and Russian economies
Chinese exports to Russia are near pre-war highs – Joe Webster for SupChina
China’s goods exports to Russia surged by 35% month-on-month to $6.77 billion, up from a recent low of $3.82 billion in April. Meanwhile, goods imported from Russia stood at $10 billion, according to official Chinese customs data, up 48.8% from July 2021, the biggest increase of all countries listed by the customs authority.
8) The Moscow car bombing
FSB solves Darya Dugina’s murder, masterminded by Ukrainian secret services – TASS
The murder of Russian journalist Darya Dugina has been solved, Russia’s federal security service FSB has said. It was prepared by Ukrainian secret services. The perpetrator - a citizen of Ukraine identified as Natalia Vovk - escaped to Estonia, the FSB’s public relations center stated.
…
To plot the murder and gather information about Dugina’s lifestyle, Vovk and her daughter rented an apartment in Moscow in the same building where the victim lived. To spy on the journalist, the criminal used a Mini Cooper car. When entering Russia, the vehicle carried a license plate of the Donetsk People's Republic - E982XH DPR, in Moscow - a license plate of Kazakhstan 172AJD02, and when leaving - a Ukrainian license plate AH7771IP. "The materials of the investigation have been handed over to the Investigative Committee," the FSB said.
What the Dugin assassination tells us about Russia – Mark Galeotti for The Spectator
Car bombs used to be a fixture of gangland feuds in 1990s Russia but have since fallen out of fashion. This makes it all the more striking when, as happened on Saturday night, such a device rips through a car just outside Moscow, killing Darya Dugina, daughter of the controversial nationalist ideologue Alexander Dugin.
Comment: Very insightful read from Galeotti.
v/r,
Joe Webster
The China-Russia Report is an independent, nonpartisan newsletter covering political, economic, and security affairs within and between China and Russia. All articles, comments, op-eds, etc represent only the personal opinion of the author(s) and do not necessarily represent the position(s) of The China-Russia Report.