OPINIONS Ukraine conflict big pay day for its instigator

OPINIONS

Ukraine conflict big pay day for its instigator

China Daily

08:03, September 26, 2022

FILE PHOTO: A general view of the US Capitol dome on Capitol Hill in Washington, US, June 9, 2022. [Photo:Agencies]

On Sept 19, the US Department of Energy said that it would release another 10 million barrels of oil reserves.

According to estimates, with Russia having cut its liquid natural gas supply, US LNG suppliers have made so much profit that every ship taking LNG to Europe can earn over $100 million. The US profiteering from the conflict is doubtlessly gross.

Just as the money flow shows, the Russia-Ukraine military conflict has not only changed geopolitics in Europe, but also deeply influenced the global energy landscape. Russia is suffering because of the sanctions. Europe is suffering from the lack of gas. The US companies are making huge profits.

For a long time, the United States has been engaging in European politics by using its military leadership in the North Atlantic Treaty Organization, but in economic matters, the two sides had differences. Now Europe's exposed weakness in energy, plus its strict low-carbon policies, make it possible for the US to compete for a bigger share in Europe's natural gas market. By getting the orders and becoming a large supplier of energy to Europe, the US has gained important economic leverage over the EU, granting it a bigger say in bilateral relations.

The conflict has also given more stimulus to the US' own energy infrastructure construction. It takes three to four years to construct LNG facilities, but the Russia-Europe relationship won't improve much within that period, which grants the US time.

It can be anticipated that more capital will flow back to the US, especially to its energy infrastructure. Texas, Pennsylvania, Oklahoma and Louisiana are all states that will receive a boost.

The US has also gained a re-industrialization accelerator. The energy industry involves more than energy; it concerns device manufacturing, electronics, artificial intelligence, labor, transportation and other industries. With its energy production to increase, the US can push its "re-industrialization" to create jobs and give a shot in the arm to related industries.

Last but no less important, the US has gained new advantages in the global economic competition. In its asymmetric mutual reliance with Europe, the US has apparently regained the upper hand. In the future it will more deeply engage in the European Union's economic governance and influence the latter.

Thus, the US has been the only winner in the Russia-Ukraine military conflict and the energy crisis that followed.

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