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EnergiesNet.com 09 14 2022

The shock waves from Vladimir Putin’s failing war in Ukraine are starting to ripple through nations on Russia’s periphery, presenting opportunities and headaches for other major powers.

The simmering conflict between Azerbaijan and Armenia erupted again today despite a cease-fire brokered by the Russian president that halted a 2020 war. Clashes occurred along their state border, with Armenia appealing to Moscow for assistance under a mutual-defense pact.

Key reading: 

• Ukraine’s Successes Stir Once-Unthinkable Hope of Beating Russia
  
• Armenia Accuses Azerbaijan of Attack as US Appeals for Calm
  
• EU Agrees to Double Azeri Gas Imports in Shift From Russia
  
• Putin Gets Unexpected Pushback from Ally Over War in Ukraine
  
• Follow our rolling coverage of Russia’s war in Ukraine here.

Reeling from its army’s retreat in northeastern Ukraine, it’s unclear what Russia could offer its ally. US and European Union leaders, meanwhile, pressed for a halt to the violence while Turkey supported Azerbaijan, its close partner.

All have a stake in expanding their influence at Putin’s expense.

The EU in July signed a deal to double imports of natural gas from Azerbaijan as it seeks to break Putin’s grip on the bloc’s energy supplies that he’s used to punish Europe over its support for Ukraine. The US, too, sees energy from central Asian states like Kazakhstan bypassing Russia as a key factor in reducing Moscow’s influence.

Nervous of potential Kremlin meddling in northern Kazakhstan’s large Russian population, Kazakh officials have reached out to the EU, Turkey and Middle East states since Putin’s invasion to try to reduce dependence on Moscow. Turkey sees an opening to expand its influence in central Asia as a bridge to Europe via the Caucasus.

Russia said it had negotiated a halt to the latest fighting between Azerbaijan and Armenia. While it retains enormous influence, Moscow now faces much greater competition from rival powers in its former Soviet backyard.

As Marc Champion reports, Ukraine’s successful counteroffensive in recent days is raising the once-unimaginable prospect of a Russian military defeat.

That may only intensify the contest to challenge Russia in places far from the battlefield.

Global Headlines

Biden’s pivot | US President Joe Biden is turning to an unexpected campaign asset: the economy. As Nancy Cook reports, falling gas prices, two major legislative victories and early signals that red-hot inflation may be easing have boosted Democrats’ bid to retain their House and Senate majorities in the November midterm elections.

Sweeping investigation | The US Justice Department has subpoenaed dozens of campaign operatives and allies of former President Donald Trump as part of a broad effort to collect information related to the plot to overturn the 2020 presidential election, sources say. The department has also seized phones, the New York Times reported.

• The chairman of the Senate Judiciary Committee vowed to investigate allegations in a new book that Trump’s Justice Department demanded that critics of the president be prosecuted.

Asia is stocking up on dirty fuel oil for winter power generation earlier than usual as a gas shortage sees environmental concerns take a back seat to making sure the lights remain on. Most commonly used to power ships, fuel oil is a fallback option for utilities when gas supplies are scarce. 

Shifting standards | Chinese President Xi Jinping is widely expected to defy the Communist Party’s retirement norms by clinching a landmark third term in power next month. The question is whether the 69-year-old will rewrite the rules for others — or just himself. The requirement that top leaders step down after age 68 has held without exception for two decades, according to a Bloomberg analysis of government data, even though party officials have dismissed it as “folklore.”

• China is willing to work with Russia to take the global order “in a more just and reasonable direction,” Beijing’s top diplomat said, underscoring the depth of the two nations’ ties.

Best of Bloomberg Opinion

• Ukraine’s Wins Make Russian War More Dangerous: James Stavridis
  
• Winter Reality Is Sinking In for EU Leaders: Lionel Laurent
  
• Right-Wing Parties Are Selling Out Across Europe: Pankaj Mishra

Iran setback | It’s “unlikely” that the US and Iran will agree anytime soon to revive the 2015 nuclear deal that Trump abandoned, Secretary of State Antony Blinken said. His comments add to growing pessimism that the sides will be able to bridge their differences over the EU proposal designed to break the deadlock.

Explainers you can use

• Why Ukraine’s Donbas Region Matters to Putin
  
• Why the EU Is Getting Tougher on Hungary’s Orban
  
• A Coalition of Tech Founders Bets Big on Public Infrastructure

Vanishing forests | More than half the tropical deforestation caused by industrial mining in the last two decades took place in Indonesia, according to a new study. The researchers, whose paper was published yesterday in the Proceedings of the National Academy of Sciences, overlapped the geographic coordinates of industrial mines with forest loss data from 2000 to 2019, focusing on 26 countries.

News to Note

• Senior US and Mexican officials expressed optimism after a round of meetings in Mexico City that they can resolve a dispute over President Andres Manuel Lopez Obrador’s energy policies.
  
  
• The US and Germany welcomed a call by Ethiopia’s dissident Tigray region for a cease-fire and peace talks to end renewed conflict in the country. The Ethiopian government is yet to respond to the offer.
  
  
• US Republican Senator Lindsey Graham plans to introduce legislation to restrict abortion nationally, as the politically explosive debate emerges as one of the central issues in the midterms. 
  
  
• Lawmakers in Senegal chose a new speaker of parliament in a chaotic vote after opposition members attempted to stop the ballot from taking place.
  
  
• At least 17 million people in Europe experienced long Covid in the pandemic’s first two years, with many still struggling with debilitating symptoms, according to a new study.

And finally … From Mexico to Brazil, soaring food and fuel costs are widening the gap between rich and poor in what is already the world’s most unequal region. As Maria Eloisa Capurro, Matthew Bristow and Maya Averbuch report, the response risks igniting a tinderbox. Persistent high inflation is stoking political upheaval in Latin America that could be a foretaste of what lies ahead as policy makers the world over struggle to meet demands to increase social spending.

— With assistance by Muneeza Naqvi, and Alan Crawford

bloomberg.com 09 13 2022