Marin Katusa: Obama is a Failed Politician – Russia a new World Power – 10/12/14
This week, our guest with the most listeners to date, Marin Katusa, is back on the show. Marin Katusa is the Head Energy Strategist for Casey Research, and is well-known and respected for his knowledge about world events and their implications for the world energy markets. We brought Marin on to give us his latest updates on how Russia is establishing itself as world energy powerhouse.
Starting out talking about the Russia/Ukraine conflict, Marin goes back to the statements Putin made saying that Russia will not meddle in foreign policy the way the US have done in their failed foreign policy. But, Putin has stated he will protect all Russians in former Soviet Union republics. So, now Russia has a real reason to protect their own in Ukraine.
With the western European nations trying to push Ukraine into the EU-28, this will really create the new “iron curtain” between Russia and the western European countries. The reality is that Ukraine owes $16B dollars in debt, because of their gas deal with Russian Gasprom. This is a battle between the Eu-28/the west & the emerging markets of the east, and right now the Russians are winning.
Moving on to the western sanctions on Russia, Marin says the sanctions have caused harmful effects, but not in the intended way. Total, France’s largest energy company, just announced that they will raise US $27 Billion in rubles, euros, yuans, (any currency except U.S dollars.) Why? Total needs their Russian LNG gas deal (the Yamal project they are developing onshore in Russia), and US sanctions prevents Total from raising US dollars for the project.
Exxon (Americas largest oil company) has a joint venture with Rosneft (Russias largest oil company), and was supposed to stop it’s joint venture due to the U.S sanctions on Russia. They’ve just drilled a new discovery, and two weeks after the sanctions were put in place, Exxon got a pass for two weeks, to continue drilling “for environmental reasons”. If the Americans walked away from this deal due to sanctions, they wouldn’t complete the terms of the contract. Exxon couldn’t walk away from the billions of barrels of oil in this deal.
Exxon, is the most held U.S energy stock held by U.S politicians. At the end of the day the politicians are there to look after themselves, not the American citizens. So, expect more drilling in the Arctic. The Russian name for this discovery means victory, the Russians have a major victory there.
We have the French and we have the Americans already bypassing the sanctions, and you’ll see the German do it also. All of this is causing alarm to the Petrodollar. And when you have allies of the Americans turning their backs to the Petrodollar, what’s next?
Touching on the oilfield that Exxon just hit when drilling in Russia, Marin states that this is going to be much bigger than the gulf of Mexico. The drilling took place about 250km from the North of Russia. This well was drilled about a little over 2000 meters of debt in open water, and they did it in less than two months, which is much more competitive than the Gulf.
Next, on the relationship between Putin and Obama in terms of the Syrian conflict, Marin says that Putin doesn’t really need to do anything right now, because Obama repeatedly keep shooting himself in the foot.
What Putin is hoping for and what Obama is hoping for is two very different things. Obama is going to be gone from office in two years. He has no legacy, and he’s going the be seen as a very failed politician. Look at what Putin is doing, he has established Russia as a new world power. Russia is signing major contracts in China, and in Iran with their nuclear power deal.
Marin states that 53% of the American population get their paycheck from the US government. And the US is going more socialist, so it’s going to become worse for the US and better for Russia, moving forward.
Marin doesn’t see a world war III scenario on the horizon. But he does see an economic war. The western media isn’t talking about the new BRICK bank which is going to be competition for the IMF, and there’s not much talk about Total which is raising $27B in non us dollars.
On the topic of investing. You want to bring proven new technology to past proven producing assets. Bringing proven new technology to places like the big oilfields in Mexico is the big thing moving forward. Fortunes will be made in Mexico, Marin states.
Finally, Marin says that as an investor, you can’t buy cheap acreage in Texas any more. But, in places like Mexico or Germany, you can get cheap acreage that the ‘big boys’ aren’t focusing on. “You buy cheap, prove up your land. Buy on the pennies and sell on the dollars. That’s why I am so excited about going to these under-explored areas that haven’t seen modern technology yet.”