Extensive US-EU Sanctions on Russia: Boomerang and Economic Backlash throughout the European Union

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Today, the dangers of military escalation are beyond description.

What is now happening in Ukraine has serious geopolitical implications. It could lead us into a World War III Scenario.

It is important that a peace process be initiated with a view to preventing escalation.

Global Research condemns Russia’s invasion of Ukraine.

The history of this war must be understood.

The bombing and shelling led by Ukraine’s Armed Forces directed against the people of Donbass started eight years ago, resulting in the destruction of residential areas and more than 10,000 civilian casualties.

A  bilateral Peace Agreement is required.


Sanctions on Russia including bans on investments in the Russian energy sector are damaging the EU economy.

EU finance ministers warn sanctions being imposed on Russia over the conflict in Ukraine will severely damage the EU’s economy for an unknown period of time.

Fuel and food prices are set to rise even more sharply than they already have.

As the cost of living in the EU goes through the roof, union members held a demonstration outside a meeting of EU finance ministers in Brussels on Tuesday. They want the bloc’s leaders to provide more support for EU citizens who are being hit hard by the financial ramifications resulting from the conflict in Ukraine.

Finance ministers have signed off on the 4th package of sanctions against Russia. 600 individuals have been targeted and Russian exports too. However, there is a very negative boomerang effect for the EU itself.

Russia, which is now the most sanctioned country in the world, has been removed from the so-called Most-Favored-Nation clause relating to the World Trade Organization.

Finance ministers say €200bn worth of loans are available to EU nations most impacted by the Ukrainian refugee crisis.

Critics say if Western leaders had shown more skill and compromise, when listening to Russia’s security concerns, the misery now being piled on Ukrainian citizens and the financial hardship being placed on EU citizens could have been avoided.


PressTV: What are the effects of the Russian oil industries sanctions on the inflation rate and energy price in EU?

Peter Koenig: Horrendous! Germany depends for about 50% of its hydrocarbon energy on Russia. They have to find other sources – and that will not be immediate.

First, the US will want to sell their fracked gas to Germany at roughly 50% higher prices than currently sold by Russia.

Then, they will have to look for other sources, probably in the Middle East.

Mind you, Saudi Arabia has already declared that they would rather sell their oil and gas to China in Yuan, than to the US and the west — they feel more secure with the Chinese currency than with a faltering – and possibly soon collapsing US dollar and Euro.

What will be the inflation? Difficult to predict – could be anything between 30% and 50%, as energy affects everything, the entire food production cycle, industry, transportation, heating and much more. Severe energy shortages will also drive small and medium size enterprises into bankruptcies, create unemployment social misery and famine.

This may be at least an extreme hardship phenomenon until new energy sources are found.

PressTV: Why does Germany go along with these EU – actually US imposed — sanctions?

Germany is totally in the hands and under control of Washington – has been since the end of WWII – as Mme. Merkel clearly demonstrated, during the past 16 years. And so did her predecessors.

One of the reasons might be that Germany does still not have a Peace Agreement – yes, they don’t. Since the end of WWII, German “Peace” is administered through an armistice agreement which is controlled and framed by the so-called Allied Forces, in other words the United States, acting as the empire on behalf of the other allies.

Several pre-Merkel chancellors have tried to circumvent the strict conditions of obedience to the Washington masters. They were unmistakenly told “NO” under no circumstances… or else.

This also explains the most important NATO base in Ramstein, in Southwestern Germany, with untold nuclear warheads, despite the fact that Germany is part of the non-nuclear treaty.

PressTV: What are the prospects for the future of Russia-Ukraine negotiations?

PK: That’s a good question.

There have recently been signs that Ukrainian President Zelenskyy and Vladimir Putin may meet in Jerusalem, in a summit mediated by Israeli PM Naftali Bennett.

But neither side has confirmed it, and no dates have been set.

Earlier Mr. Zelenskyy indicated that he may be willing to make certain “concessions”.

Today, March 15, RT  quotes Zelenskyy as saying NATO allies don’t want to see Ukraine among their ranks and Kiev realizes that. Now Kiev seeks protection from individual member states.”

Let’s however not kid ourselves, Zelenskyy is a US pawn totally under Washington’s control. He cannot make sovereign decisions, especially not as far as US interests are concerned.

Ukraine is not at war – it’s the US which is carrying out a proxy war against Russia on Ukraine’s territory.

The US motive is the same as it was already during WWII – if not much earlier – and then during the Cold War, controlling the huge territory of resources-rich Russia.

And as a byline, so to speak, move closer to China’s borders – which on the East Pacific side is already encircled by many US military bases or bases that host US armament and personnel.

In addition to all the natural resources – on and under Russia’s territory – Russia and Ukraine are also Europe’s breadbasket. A war, initiated and fueled by the west, will most certainly shut that food supply line to Europe down. It may bring shortages and famine to Europe and beyond.

The empire is collapsing ever faster, and the dollar and its little sister the Euro, are also faltering at an accelerating speed.

Mind you all western leaders, including Australia and New Zealand, were chosen not by the people, but by those elite and financial corporations who manipulate the current ascent of an unseen tyranny in history as we know it.

What is in the making is a health tyranny – WHO gaining full control over all health systems of its 194 member countries, actually overriding national constitutions.

If the plan holds, it should become legal in 2024. Most people around the world don’t know it, as the media are paid to keep silent about it. All that is happening in the shadows of the war in Ukraine.

We can just hope that there will be a general waking up and the plan will fail.

Many of these so-called western leaders went to Klaus Schwab’s (CEO and founder of the WEF) “academy” for Young Global Leaders”, where they learned the tactics of dictatorship, leading to tyranny, if they encounter rebellion by the citizens.

A case in point may be Canada. These “leaders” (sic) are bought by the WEF and the WEF’s handlers, and have no interest in the people of their countries. They don’t care if their nations’ citizens live or die.

This is a long answer to a brief question about the prospects for the future of Russia-Ukraine negotiations.

Personally, I do not think that there will be a nuclear war. There is too much at stake for the elite. NATO and all its members know Russia’s military and nuclear capacity. So, they may refrain from an all-out war, and instead make believe that Russia will be collapsing under the punishment of sanctions.

Biden has just announced that his administration will allocate a billion dollars to “support” the media – in other words, corrupting them so they continue lying and propagating the false government narrative.

Russia will every day be less affected by western slandering and sanctions as the Russia-China-SCO (Shanghai Cooperation Organization) alliance is self-sufficient on all vital goods and services.

The trend is towards a multipolar world. It is well possible that the conclusion of the Ukraine war will lead into this direction – hopefully a new peaceful world paradigm.


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Peter Koenig is a geopolitical analyst and a former Senior Economist at the World Bank and the World Health Organization (WHO), where he has worked for over 30 years on water and environment around the world. He lectures at universities in the US, Europe and South America. He writes regularly for online journals and is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed; and  co-author of Cynthia McKinney’s book “When China Sneezes: From the Coronavirus Lockdown to the Global Politico-Economic Crisis” (Clarity Press – November 1, 2020)

Peter is a Research Associate of the Centre for Research on Globalization (CRG). He is also is a non-resident Senior Fellow of the Chongyang Institute of Renmin University, Beijing.


Beijing-Riyadh Oil Sales Cooperation And the “De-dollarization Process”

Amidst the unstable relations between Saudi Arabia and the US, which since last year have oscillated between a total boycott and a moderate cooperation, Riyadh now shows interest in contributing to advance the process of de-dollarization of the world economy. According to recent reports, the Saudi government is willing to trade oil in Chinese Yuan. The measure would be a major blow against the American financial power, which has the Petrodollar as its base of monetary security.

According to the Wall Street Journal (WSJ), in an article published on Tuesday, March 15, Riyadh is considering starting to price and trade its oil sales in Chinese Yuan, abandoning the dollar standard. The piece also informs that such a pricing plan has been in development for six years, having been accelerated recently as a reaction to the strong pressure exerted by the Biden government against Saudi Arabia. In the words of one of the WSJ’s Saudi informants:

“The dynamics have dramatically changed. The US relationship with the Saudis has changed, China is the world’s biggest crude importer and they are offering many lucrative incentives to the kingdom (…) China has been offering everything you could possibly imagine to the kingdom”.

As expected, the impact of the news on the financial market was immediate. The value of the offshore Yuan has risen considerably compared to the dollar across the Asian market, generating many expectations of investments in the Chinese currency. The impact is expected to be even greater in the coming days or weeks, considering that, amidst the current context of tensions and conflicts, Riyadh has the ideal scenario to make public and advance its financial measures of de-dollarization without waiting for large-scale international sanctions on the part of the West – which has other priorities at the moment.

In fact, the Saudi maneuver seems interesting and of high strategic value at the moment. China buys more than a quarter of Riyadh’s massive oil exports and since 2018 has offered a series of contracts priced in renminbi. Furthermore, cooperation appears to be increasing in both directions. For example, state-owned Saudi Aramco announced last week that it would help build a new oil refinery in northeast China with the capacity to produce 300,000 barrels a day. Apparently, Beijing sees Riyadh as a key energy ally for the Belt and Road Initiative (BRI) project, and, on the other hand, Riyadh sees the BRI as a great opportunity for profitable short-term investments. In this sense, pricing in Yuan would be an even greater engagement in cooperation, which would benefit both sides and help to reduce global dependence on the dollar standard.

Obviously, despite the clear direct economic interests, it is not possible to ignore the deep geopolitical aspect of the issue. The current US administration has maintained the most anti-Saudi stance ever seen in the White House. Last year, Biden even stopped US support for the Saudi campaign in Yemen – although he was “restricted” in many ways by the US arms industry. Biden maintains a strong humanitarian and liberal ideological stance, which does not allow him to agree with an undemocratic regime and with a campaign as violent as the war against the Houthis. In addition, he is “compelled” to renounce his democratic principles on several other points – such as the Ukrainian dictatorial regime, for example -, so he needs to choose some targets of lesser strategic importance to maintain his image as a global defender of democracy, and, apparently, he chose Saudi Arabia.

The very conflict on Ukrainian soil also favors this type of measure, as there is a global trend towards multipolarization on several levels, including the economic and financial ones. China stands against the boycotts on Russia and elevates its partnership with Moscow in every way possible, which means that the West may soon also implement coercive measures against Beijing. So, Saudi Arabia takes advantage of the moment in order to enter a possible new market route, with prices in Yuan, serving the interests of China, its partner nations – including the entire BRI – and the BRICS. In this sense, de-dollarization seems just a natural consequence of the process of formation of a polycentric world, as it is being designed with the events in Eastern Europe.

With this global scenario, the West will have a single choice: to understand that a multipolar global order presupposes multiple monetary standards, with no more room in for dependence on the American Dollar. It is inevitable that the dollar will become just another possible currency in international transactions, competing not only with the Yuan, but also with other currencies and digital assets, such as cryptocurrencies. Obviously, it is possible that Washington will re-establish good ties with Riyadh in the future, but stopping de-dollarization no longer seems an attainable goal.

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