Oil is the reason behind Putin’s covert acts in helping trump to win the 2016 U.S. presidential election. Specifically arctic shelf oil.
The U.S. Energy Information Administration (EIA), reports that Russia’s largest exports are oil and petroleum products, they are one of the largest producers of crude oil in the world, and they are the second largest producer of natural gas, after the US.
One of the US’s top imports is crude oil ($230 billion), one of Russia’s top exports is crude oil ($155 billion). The US alone purchases (16.5 billion) worth of Russian crude oil. Russia’s economy depends on its energy exports, oil and natural gas comprise 68% of their total export value.
What does this have to do with the recent presidential election? The connection to the 2016 election, and the recent CIA report stating that Russia interfered with the election to help Trump win the presidency has roots in the Russian invasion in the Ukraine in 2014 and the desire of Exxon Mobil to drill for oil on the Russian arctic shelf. Putin invaded the Crimean region with the goal of annexing Crimea into Russia. Due to the threat to Ukraine’s sovereignty and democratic processes the US, the EU and Canada introduced a series of emergency sanctions.
According to the EIA, (bold is mine)
“In 2014, a series of progressively tighter sanctions, imposed by the United States in response to Russian actions and policies in Ukraine, led to reduced investments in Russia's upstream sector. The sanctions limited the ability of Russian firms to access U.S. capital markets and prohibited the export to Russia of goods, services, or technology in support of deep water projects, Arctic offshore projects, or shale projects.
These sanctions have halted virtually all involvement in Arctic offshore and shale projects by Western companies. Without such involvement, new Arctic resources are unlikely to be developed. Although this has little immediate effect on Russian production, the sanctions, along with the low world oil prices, have made it more difficult for Russian energy companies to finance new projects.
Much of Russian crude oil production comes from the West Siberia and Urals-Volga regions in central and western Russia, but production in East Siberia and Russia's Far East regions has increased, and oil fields in eastern Russia and in the Russian Arctic stand to play a larger role in the country's future production. However, new projects may be delayed or otherwise affected by economic sanctions currently in place.”
In March of 2014 President Obama signed executive orders 13660 and 13661 authorizing sanctions against Russia in support of the Ukraine. As a result the little known Office of Foreign Assets Control (OFAC) outlined four directives of the sanctions and was charged with monitoring adherence to the sanctions in addition to fining and penalizing companies and persons that did not comply.
Of interest is OFAC directive 4.
“Directive 4 prohibits the following transactions by U.S. persons and within the United States: providing, exporting, or exporting, directly or indirectly, goods, services (except for financial services), or technology in support of exploration or production for deep-water Arctic offshore, or shale projects that have the potential to produce oil in the Russian Federation, or in maritime area claimed by the Russian Federation and extending from its territory, and that involve any person subject to Directive 4, its property, or its interests in property. The names of those persons and entities listed in an Annex to, or designated pursuant to, E.O. 13660, E.O. 136”
Interestingly enough, according to Politico, the president elect’s, all but in the bag, Secretary of State pick, Exxon Mobil executive, Rex Tillerson in 2011 worked on negotiating a multi-billion dollar deal between Exxon Mobil and the Russian state oil company, Rosneft. The deal would have, (have you guessed it) allowed Exxon access to the Russian arctic shelf in trade for drilling technology, the arctic shelf contains an estimated quarter of the earths oil and gas deposits. However over time the tightening sanctions carried out by the OFAC directive 4 stopped Exxon Mobil’s plans to drill in Russia’s arctic shelf region. As a result it’s reported that by October of 2016 Exxon Mobil lost over a billion dollars due to the US sanctions. There are also recent reports heralding the ultimate demise of Exxon mobile due to the lowering price of oil and the increasing demand for alternative sources of energy due to global acceptance of climate change.
CNN Money reported in October 2016:
”Of course, Exxon does face climate change risk too. Demand growth for oil and other fossil fuels may be challenged by efforts from major economies to limit carbon emissions. Governments have also offered more support for clean energy alternatives like solar and wind.”
And surprise of all surprises (not really) trump owns stock in Exxon Mobil, and evidently a lot of it.
According to Politico:
“To do business in Russia—both for Exxon Mobil and for Tillerson’s own massive retirement fund, whose fortunes would rise significantly if a Trump White House lifted sanctions—you have to dance to Putin’s tune, and take whatever favors and humiliations he sends your way.”
Lifting OFAC sanctions against Russia would obviously result in a net gain for trump’s fortunes, Tillerson’s fortunes and Exxon Mobil’s fortunes at the risk of national security and our American democracy. If trump sells any of his stocks in Exxon Mobil and affiliates; Kinder Morgan and the Canadian oil sands project, we won’t know about it until his next Federal Election Commission (FEC) filing in May 2017 or unless he announces it to the public in general, which is unlikely given that he shuns the American people unless it’s to endanger private individual citizens via twitter.
According to Forbes trump’s connections don’t stop with Putin, Tillerson and Exxon Mobil.
“The climate-change skeptic owns shares in Phillips 66 PSX -0.54% - a joint venture partner in the controversial Dakota Access pipeline, where demonstrations are ongoing, and in Kinder Morgan, another pipeline giant facing resistance for its plans to connect the Canadian oil sands to Vancouver, British Columbia. Trump also has a small investment in Canadian energy company TransCanada, the developer of Keystone XL pipeline, which was rejected by President Barack Obama last year but supported by Trump.”
If this is not an example of high treason, I don’t know what is.
Let the arctic offshore drilling projects begin to the tune of the oil billionaire’s, ka-ching ka-ching.