It’s time for an update on the war in Ukraine || Peter Zeihan

hey everyone Peter Zion here coming to you from the Kepler track in New Zealand's fjordland national park that is a lake Tano behind me there is the sunrise uh today I'm going to do something I haven't done for a while and give you an idea of what's going on in the Ukraine war we've had some evolutions of late that are definitely noteworthy uh from over this past summer uh the two big things still hold true uh the Russians are still advancing inch by inch on the city of pcrk in the southeast east of the donbas

region um where if they can capture they can kind of shatter uh the Ukrainian front lines uh because pakros is a rail Nexus that supplies seven parts of the fronts all at once and if we were to fall uh the ukrainians would have to go three four five times as far to get a troops from point A to point B which would be a crippling blow uh and in the North in KK province which is technically in Russia the ukrainians are still on the offensive they've lost some ground uh but this is where the Russians

are using human wave tactics uh specifically using uh North Koreans uh specifically we've seen evidence that the North Koreans have been instructed by their dear leader back home for one guy to go out and stand in a field to attract drones and then for everyone to be out on the edges in the forest shooting at the drones uh needless to say uh casualties and fatalities among the North Koreans have been horrific uh even by Russian standards but the 12,000 uh North Koreans that were deployed are I mean the best word is suicidal uh they've from

the people who have been captured the equipment that's been captured it's pretty clear that the North Korean soldiers were told that if they defected or didn't fight uh according to instructions that their families would be killed back home uh now 12,000 troops are not going to make the difference in a war where the Russians are losing uh you know that many in a couple of weeks the question is whether more North Korean troops are coming and so far that we haven't seen that okay uh other big things that are going on from the week of

January 14 uh first and kind of splashy the United States and the European Union have announced a new set of sanctions targeting the shadow Fleet based on whose numbers you're using somewhere between three and 4 A5 million barrels a day of Russian oil exports are in the shadow Fleet this is a fleet of very old decrepit tankers that are often uninsured or underinsured that are operating without the transponders uh so that they don't have to um get Western Insurance or anything like that by tightening up the sanctions basically what the West is attempting to do

is convince countries like India and China that they should not take Russian crude at all and at the moment it is working but I wouldn't get bet too much on this cuz what has happened with every other time sanctions on the shadow fleet has tightened is that they find another way around it uh it lasts for a couple of months and unless you actually start grabbing the ships I really doubt it's going to make a longterm difference so it does do a hit to uh Russian oil Flows In the meantime it does allow us Shale

producers and OPEC producers to displace a little bit of Russian crude but it probably won't have legs unless it's paired with something else number two we might be getting that something else pretty soon uh also the week of the 14th the the NATO alliance announced a new task force for the Baltic specifically to Monitor and intercept if necessary uh the shadow Fleet now this is important for a couple of reasons number one uh NATO to this point uh largely due to the Biden administration's assist insistence has not gone after the shadow Fleet the goal has

been to keep Russian oil flowing to the world but to f a way to deny the Russians some of the income for doing so so part of the reason the shadow Fleet exists is to bypass the system according to the NATO and European sanctions uh if you buy crude from the Russians that is priced less than $60 a barrel then it's okay and you can use Western ports and you can use Western facilities it's only if it's over $60 that you have to use the shadow Fleet uh anyway uh this task force is important because

it now has a mandate to go after the shadow Fleet in certain specific circumstances it's not a blanket uh interdiction policy or anything like that but from my point of view more importantly it is the first Naval task force that NATO has ever formed in the Baltic and the first one that has ever involved Finland or Sweden who are new members in the last couple of years since the Ukraine war got going and these two countries are the masters of the Baltic and have been for the last half Millennia uh so their involvement is pushing

uh the Russians into a new position because they haven't had to deal with Finland as an offensive power since World War II and Sweden for three centuries so there's a lot of history here that is coming back to the four that is going to unspool a lot of the expectations of a lot of players in a lot of places uh but third and far more importantly is what's going on in the war in Ukraine itself now for several months the ukrainians have been launching attacks on things like Russian refineries and that has been something that

the Biden Administration has um tried to convince them to do less of to with some success because according to the Biden administration's math which I would argue is dumb uh interrupting Russian oil flows is going to drive up the price of oil globally is going to drive up the price of gasoline in the United States is going to trigger inflation in the United States and that's a political issue now I have a number of reasons why I think that is wrong number one the United States doesn't use much Russian oil or hardly any uh number

two anything that is dis reped out of Russia is easily replaced by say us Shale producers who do Supply the US consumer uh and third uh the US gasoline Market is in a completely different Market Dynamic than the global D market so you might see a little bit of price pressure in the short term but nothing that is durable nothing that's sustainable anyway that was the bid administration's logic it had an impact on the war effort well a couple things have changed uh number one a lot more Global oil supplies have come online in the

last year so the Biden team is not nearly as concertive about that inflation pulse one way or the other number two Joe Biden really isn't worried about reelection at this point and so it's okay for the gloves to come off and so the ukrainians are hitting a lot more targets and we saw our biggest aerial drone assault of the war so far by the ukrainians hitting targets that were almost 1,000 kilometers inside Russia going after 15 different facilities on the same day now their specific Target are things called fractionating columns which are pieces of equipment

that the Russians lack the capacity to build themselves and the Chinese ones suck even the Chinese ones use a lot of Western components so anything that ties up the Russians doing repairs where the repair work starts on a supply chain that has to go through a third country to get around sanctions is something that definitely slows the Russian economy and the Russian war machine but the much bigger impact of this is going after high-end chemicals uh you use a fractionating column to split oil into different product sets everything from the bitamin that you would use

to make a road to the high-end lpgs that you use for things like propane and butane uh but some of the stuff in the middle you're going to be using to make things like hydren uh and other Advanced compounds that are the core for things like rocket propellant and explosives so by going after this stuff at scale it's not just that the ukrainians are attempting to disrupt the flows of equipment that are coming to the front by going after the fuel manufacturer they're actually going after some of the more advanced components that allow the Russian

war machine to be the Russian war machine and things like explosives and artillery uh now the Russians obviously can import this stuff from elsewhere if they need to however traditionally the Russians have been a major exporter of this stuff and while the Chinese can produce it they produce it all the way on the Southeast coast of China so as far away from Russia as you can possibly get and the Chinese are typically an importer of this stuff from Russia so if enough of this stuff goes offline in a short period of time you won't see

the impact immediately but a few months from now when the Russian war machine is running out of the components they need to make their weapons you would actually see a pretty big impact uh but a lot of things can go down between now and then for example by the time you see this video Donald Trump will be the new president we might have a new policy on Ukraine I have no idea what that's going to look like I can just point out that the Russians have already basically told Donald Trump to off uh with his

peace proposals and that is undoubtedly going to generate a relatively difficult to predict specific outcome uh so we're all kind of in a waiting mode on that one uh which obviously matters okay that's it for me y'all take care