With the Obama Administration and the European Union imposing a first round of sanctions against Russia and the first round of retaliatory sanctions from Russia expected any day now, a full-scale “economic war” is getting underway, and Europeans are cringing at the thought.
This isn’t 1960s behind-the-Iron-Curtain Russia with no real economic ties to the West, but a energy powerhouse that is a vital trading partner for much of Europe, especially with respect to natural gas.
British Foreign Secretary William Hague says the EU is “looking” for ways to reduce their dependence on Russian natural gas, but with Russia’s Gazprom the largest gas company on the planet by far, there simply aren’t a lot of alternatives, and Russia may simply be irreplaceable to many economies.
It is telling that neither the US nor EU tried to target Russia’s oil and gas majors in the first round of sanctions, knowing that’s the point where sanctions are going to hurt Europe a lot more than Russia. With retaliation expected to go back and forth for quite some time, it seems only a matter of time before they get there anyhow.