Geopolitical (Un)realities

Photo by Random Person on Unsplash

We are witnessing a massive phase shift in world politics. Despite all the handwaving we are already in a war of the worlds, and we are waging it — yet again — to gain/maintain access to cheap energy and mineral resources. While this blog is — and always will be — primarily about energy, resources and ecology, I will continue to dedicate some space to discuss geopolitical events from time to time. I will not go down to a tactical minutiae level nor give moral lectures, just state the facts that — for me at least — seem obvious. And while some of the following might seem controversial in light of the current public discussion in the West, all of these statements are proven by facts on the ground, and might serve as a refreshment for those wanting to see a more balanced view.

Ukraine has lost the war, even before it began in earnest

Needless to say, the war in Eastern Europe didn’t start in 2022. It started in 2014 with a coup d’état — organized and carried out using billions of western taxpayer money — launching ultra-nationalist forces into power, who immediately started to restrict the rights of minorities and allowed atrocities to be carried out against them. (Including ethnic Russians, who comprised at least 30% of the population of Ukraine back then.) This violent political act has put Ukraine firmly in the Western camp, despite the many warnings given by Russia (since 2008 already) that such a move could provoke a civil war in the country and force them to intervene. Needless to say all such warnings were disregarded.

Instead, plans were made to turn Sevastopol into the largest NATO base on the Black Sea, and excavation works began to install “missile defense” silos close to the Russian boarder, along with increased arms deliveries from the West. The Supreme Council of Crimea, a firmly pro-Russian autonomous republic in Ukraine, voted unanimously to call for help from Russia and the two easternmost provinces (Donetsk and Luhansk, with a primarily Russian speaking population) did the same. As a result civil war broke out, which has quickly turned into a proxy war between Russia and NATO, each supporting their side in the conflict. There were several attempts to make peace—most notably as part of the Minsk I. and II. agreements—demanding,  among many other things, Ukrainian neutrality written into the constitution. Needless to say, no such thing has happened. Instead, these agreements were used to buy time to prepare Ukraine for a much bigger conflagration, with the publicly stated goal of weakening Russia and ditching it as the primary energy supplier of Europe. Successfully provoking an outright military intervention was merely a question of time then. But why was this war lost even before it began?

The conflict in Ukraine has brought back industrial warfare. And industry means manufacturing large amounts of ammunition and hardware — all of which is made from steel and powered by fossil fuels. And which side is producing more of those…? Not Europe for sure. Despite all the green rhetoric, fossil fuels are essential for almost every industry, including the making of solar panels and wind turbines. Participating in provoking an armed conflict in Ukraine was thus a reckless gambit for Europeans, which if succeeded could have guaranteed the continent’s prosperity for decades. You see dragging Russia directly into the conflict and slapping sanctions on it should’ve precipitated in a massive political crisis there… Then a Yeltsin-like figure could’ve been brought into power to facilitate the “decolonization” of Russia (read: carving it up into smaller portions and gaining access to its vast resource base). However, if the war dragged on (as it did) and if sanctions were to fail (as they did), Europe would plunge into a deep economic depression — which is now taking shape right in front of our eyes. This was not something hard to see, I and many others, wrote about it back then, in 2022 already (here and here.)

For Russia the war in Ukraine was thus an existential conflict; stirring up very bad memories of European forces trying to invade them (from Napoleon to WWI and WWII). For them it was essential to prevent a NATO bulwark being built up on their doorstep, blocking their access to the Black Sea and threatening them with missiles which could also be equipped with nuclear warheads. (For a reminder: the last time nuclear powers faced such a threat — Cuba, 1962 — the world almost ended.)

What about the US, the world’s largest economy, then? Well, despite soaring GDP figures, the US is in an economic stagnation ever since its traditional (on shore) oil production peaked in 1972. And while outsourcing manufacturing to China and gaining access to their huge market has created an illusion of prosperity, that didn’t help America the slightest to come close to Russian shell production figures  ( and let’s not talk about rockets, drones and missiles). Quite to the contrary: Russian military-industrial output, air defense, electronic warfare and hypersonic capabilities have all proven to be much more formidable than anything the West had to offer — not to mention capabilities in military strategy and operations on the ground. The West has entered this conflict on a number of flawed economic and military assumptions, and is now poised to be defeated.

NATO article five is — de facto — in force already

While the above statement might sound outlandish, since Ukraine is not a member of the alliance de jure, it is nonetheless treated as such. Intelligence, targeting and communications is provided entirely by Western military and dual-use satellites. According to the spirit and letter of article 5, NATO countries “assist the Party or Parties so attacked by taking forthwith, individually and in concert with the other Parties, such action as it deems necessary, including the use of armed force.” Think providing tanks, ammunition, military training and “advisers” operating air defense units as well as programming long range missiles. (Therefore if such weapons were to be used on Russian soil that would be tantamount to a direct NATO attack — carried out by NATO personnel using NATO weapons— resulting in counter-strikes on Europe and the US. If you were looking for reasons why the US has dropped this idea, look no further.)

We are talking about no small help here. The economy of Ukraine is in ruins. The entire state is kept alive by Western military and financial aid as well electricity and fuel supplied by European nations, without which the war would end in a matter of days. Now, with that aid dwindling as stockpiles of weapons run low with no manufacturing capacity to fill them up — as the Kiel Report has found — NATO as an alliance faces a military defeat. Escalating the conflict further thus makes no sense: Europe is already out of weapons (their forces would last only a week or two at best) and the US is increasingly bogged down in the Middle East. The only question remaining is thus how long NATO’s protege can last before it is forced to capitulate? I wager we won’t have to wait for the siege of Kiev to see that happen, but I could be wrong. The hoopla about Ukraine’s official NATO invitation is thus nothing but a face saving measure. It is a way of providing plausible deniability that this war is not a NATO war on Russia (which it is), and that the alliance is not losing it (when in fact it does, badly). 

It’s no wonder that desperation is palpable across Europe. Just consider what would happen to the EU once the penny drops, and it becomes common knowledge that NATO has lost the war… That the alliance was incapable to defend a single country, let alone the entire continent. That the once famed technological and manufacturing might of the West has quietly disappeared. What would happen to the unity should the public learn who was actually behind blowing up gas pipelines, and who forced the hand of legislators to sanction Russian fossil fuels (coal, oil and indirectly natural gas) kneecapping the European economy? Or how about Hungary and Slovakia leaving the EU if push comes to shove? Is it any wonder that Euro-skeptic forces are surrounded by a firewall, and no matter what percent of the vote they collect, they are not allowed to form a government?

The Western world order is history

The West, and Europe in particular, has been living on other nations resources for far too long. They neither have their own energy nor their own materials to continue as they did in the past. Should deliveries of Chinese processed rare earth elements or components made their dwindle, for example, literally nothing could be produced in the West for quite a long time. Rearming Europe, while it is actively waging a war on its energy supplier, and increasingly on its component supplier, is thus a fantasy. Sure, as long as some manufacturing capacity remains on the continent there will be some production of ammunition, tanks and artillery, but only on a ‘boutique’ scale. “Renewable” and nuclear energy simply cannot produce the concentrated high heat (at a low energy investment) needed to run a productive economy with steel mills, smelters, chemical plants, mining and all the rest. With the taps closed, pipelines exploded and political relationships towards Eurasia ruined, Europe is now forced to buy energy from the US at uncompetitive prices, making an economic and military revival highly unlikely. Intentionally or not, the Wolfowitz doctrine — with an “objective to prevent the re-emergence of a new rival, either on the territory of the former Soviet Union or elsewhere” — has been fully implemented, and failed. At least when it comes to Russia. Europe, on the other hand, lacking its own mineral and energy resources will be unable to make a comeback on the world stage on its own, and with its relations with Russia in ruins, it will be forced to de-industrialize. 

Soon, however, the US will find itself in the same situation. It’s an open secret that the shale revolution will not last forever, and it’s decline is on the horizon. And while investments in deepwater oil is already outpacing shale, these new resources will not be able to offset the decline in continental oil production for much too long (not to mention their even poorer energy return on investment). According to the words of Bob McNally, a former adviser to President George W Bush (yes, the same man who gave advice to the same Bush who started ‘Operation Iraqi Freedom’), a decline in US oil production will wreak havoc on the world.

“If we end up being more thirsty for oil than the prevailing forecasts assume, then we’ve got big problems. It would be an era of economy-wrecking, geopolitically destabilising, boom and bust swings. That’s when you will wish for more shale.”

Primary energy consumption by source. Chart: Our World in Data

Remember: oil is still the number one energy resource on this planet, and the lifeblood of this civilization, enabling all the mining, agriculture and long distance transport activities; something, without which the economy would grind to a standstill. (Not to mention war making capabilities, fueling all those tanks, ships, cruise missiles, etc…) Access to cheap and plentiful oil is thus the single biggest factor in any nation’s prosperity and security. Is it any wonder then, that Western (OECD) countries still consume more than half of the world’s oil output (both directly and indirectly, embedded in products), while they represent only 17% of world population? How on Earth could they maintain their high living standards at home, and some 800+ military bases abroad, without such an unfettered access to energy? So when many in the alternative media say that the US has no security interest in Ukraine or in the Middle East, I must remind them that both of these wars are (at least partially) waged to gain/maintain control over the two largest oil producing regions of the world outside America: Russia and West Asia.

The stakes could not be higher. BRICS nations already represent 44% of the world's population and 36.8% of global GDP (PPP) and control 30% of global oil production. (For comparison the magnificent G7 represent less than 30% of global GDP on a PPP basis—just take a look at this animation to see how this exponential change looks like in real time.) Should the West continue to lose control of the oil-rich regions of Eurasia, Europe and America could easily find itself paying a real price (most likely in a foreign currency) for oil. While this looks completely unimaginable today, think about what would happen to the dollar if you could no longer use it to buy petroleum… Or if countries could trade completely outside the dollar system — as proposed by BRICS on their summit in Kazan, last week… Or how about grain for oil? Could the ballooning US debt be financed once America no longer has access to the better part of world trade, or their European “partners” go down the drain and stop buying up US treasuries to prop up the dollar? Should the BRICS succeed in their plans, and create an alternative trading system based on real commodities like grain, minerals and oil, it could easily put the West’s financial and economic system at the risk of implosion. This is what these wars are about, not freedom and democracy.

The Future

We are witnessing a  war of the worlds, where both sides coordinate their actions, measure up potentials for escalation and support parties on their side to achieve their goals. And as both net energy production from oil and actual output starts to dwindle, we will see further escalations. Facing a prospect of a steep fall in oil production at home — and with it a steep fall in living standards, and an inability to finance debt and military expenditures — the US will have little choice than to try and kneecap its rivals in Asia, too, in order to curb their imports and to direct remaining oil supplies to its shores.

First, using their strongest ally in the region (to provide plausible deniability), they might try to knock out Iran to take control of their oil production / export capacity and the Strait of Hormuz at the same time. Alternatively, they might try to blockade the Malacca Strait (where coming up with a convenient false flag also shouldn’t be that hard). Both actions are, of course, aimed at preventing China from importing all that oil from the Middle East. You see, China is by far the biggest importer of oil in the world, followed by Europe, the Asia Pacific, and — surprise — the US. Europe is now firmly under control and deindustrializing rapidly, the Asia Pacific could be controlled by the military bases in the area, so taking control of or closing either the Strait of Hormuz or the Malacca Strait is the next logical step to ensure a stable petroleum supply to the US and weakening their adversaries in the East.

The problem is, that the alliance between Russia, North Korea, China, Iran (and increasingly India) is now stronger than ever. These nations now share military technology, help to beef up each other’s defenses and perform navy drills together. Not to mention the fact, that these countries together produce far-far more weapons and ammo, than the rest of the world combined. The figures are top secret, of course, but judging from the massive salvos launched by them in both theaters (Ukraine and West Asia), and their endurance demonstrated during these operations, I have little doubt that they have long surpassed the West militarily. And this is what makes the situation so dangerous.

As usual in the case of civilizational decline, the Western ruling class continues to believe that they are the masters of the universe, even as facts on the ground strongly suggest otherwise. Presuming that a massive financial crisis does not wipe out much of the wealth of Western nations first, they will continue to double then triple down on failed policies, until the inevitable defeat arrives. Will they reach for the ultimate weapon in their arsenal then? Will they nuke Iran? Or launch missile strikes deep into Russia, knowing that a retaliation might hit them directly? Will we be able to stop the rapidly unfolding chain of escalation then, all the way up to strategic level? It’s hard to tell at the moment, but the risk is far higher than most of us in the West would like to believe. And even if the multi-polar world comes out on top, how long will their victory last? How much time will they be able to buy establishing an alternative trading system? A decade? Or two? When will exponential growth in energy demand, and a similarly exponential decline in net energy production cause their economies to collapse? What will happen then? Will they nuke Iran? Or launch missile strikes deep into Russia, knowing that a retaliation might hit them directly? Will we be able to stop the rapidly unfolding chain of escalation then, all the way up to strategic level?

Until next time,

B

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