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Thursday, May 08, 2014

Gas Prices: Follow the Money

Let me see if I have this right . . .

Ukraine buys almost all its energy (natural gas)from Russia. Revenues from natural gas sales are a primary source of income for Russia.

Because of the recent disagreement between Ukraine and Russia, Russia is raising the price of natural gas it sells to The Ukraine.

The Ukraine is almost broke and can't afford the increase in the natural gas price because it would be forced into bankruptcy.

President Obama (The USA) just announced the United States is giving The Ukraine, $1 billion to assist in paying for the higher priced natural gas it buys from Russia.

So, the United States is actually giving Russia $1 billion because the money is just passing through (Transfer Payment) the Ukraine to Russia.

The first question: Has Vladimir Putin figured out a way to raise the price of his natural gas sales and make the U.S. pay for the increase?

If this analysis is accurate, Vladimir Putin just got Barack Obama (the USA) to pay him $1 billion by holding a press conference and trucking some troops across town from the Russian Navy base in Ukraine.

Who is the smartest guy in the room now ?

Oh Yes… Remember what President Obama said to the Russian President before the last election:

“I’ll have more flexibility after I am reelected. "

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