The clandestine war on Russia seems to be continuing, as CNN/Money reports:
It keeps getting worse for Russia.
The combination of Western sanctions and tumbling oil prices is pushing it deeper into recession. Russia’s economy shrunk 4.6% in the second quarter, the biggest drop since the global financial crisis in 2009.
The ruble has plunged 22% against the dollar in the past three months. Inflation soared nearly 16% in July.
Russia is heavily dependent on its oil riches — around half of its government revenue comes from oil and gas exports. Oil prices slumped from $107 a barrel last June to $44 right now, forcing Moscow to cut spending across the board.
How are oil prices doing? NASDAQ provides this short-term history (chart unembeddable) of oil prices here, indicating a 26% drop in prices since July 1. MacroTrends takes a longer view with a nifty interactive chart indicating oil prices dropping back to 2009 levels.
And CNN/Money doesn’t even mention the primary long-term problem: oil is a fossil-fuel and will become less and less valuable as human-friendly energy sources (also known as carbon-neutral) become more cost-effective and wide-spread – and concern about climate change comes to the forefront as weather patterns become more erratic. Assuming this drop in oil prices is the work of the Obama Administration, they may be forcing Russia into second or third tier status for an entire generation. The Russians may have to choose between having nuclear weapons, or taking care of its citizens – and once it walks away from nuclear weapons, it’s a hard slog back because nuclear weapons and their delivery systems deteriorate over time.
And what might be these carbon-neutral energy sources? Algae might be one of them, oilprice.com notes:
Although other crops, such as corn and soybeans, have been used to produce biofuel in the past, algae offer several advantages over them. According to the US Department of Energy, algae yields are between 10 and 100 times as high as those of traditional biofuels. What’s more, algae can grow in marginal or brackish agricultural areas, meaning that production can be ramped up significantly without competing with food crops for land and other resources.
The global market for biofuel was estimated at about $100 billion in 2013. Many believe that the size of this market could almost double within the next few decades. According to scientist and entrepreneur Craig Venter, it would take a land area three times the size of the United States to replace all the fuel used in transportation in the U.S. with corn-derived biofuel. By contrast, it would only take an area the size of Maryland to do so using algae.
