Putin Has Europe Right Where He Wants It

Vladimir Putin isn’t stupid. 

Love him or hate him, there’s no question that the Russian president isn’t weak either. 

The geopolitical mess and ongoing spat between Russia and Ukraine should strike fear into the heart of every European who hopes to keep warm this winter. 

At first glance, you might be inclined to believe that the EU can pressure Russia into capitulating. After all, nearly 60% of Russia’s annual budget relies on oil and gas revenues, and they make up a staggering amount of the country’s gross product. 

Hey, maybe the most recent threats of killing the Nord Stream 2 pipeline project will be enough. 

Perhaps if the EU just turns the screws on Putin a little and threatens those energy exports just enough, Putin will give in. 

Unfortunately, both the EU and Ukraine need Russia much more than Russia needs them. 

And if history is any guide, we know Putin is more than willing to turn off the taps.

Then again, last time turned out to be a golden opportunity for a small group of investors, and today is no different.

The more veteran members here in our Energy and Capital investment community remember that it wasn’t too long ago that Putin shut off Russia’s gas supplies to Ukraine after a contract dispute. 

The ordeal began at the end of 2008 and lasted a few weeks into 2009. After the typical posturing, gas exports into Ukraine were halted, which had a rippling effect into the rest of Europe.  

Russia lost roughly $1.5 billion in lost gas sales yet proved its resolve that when push comes to shove, Putin was willing to shut off the gas entirely. 

But like I said, he’s not stupid — you can bet he’s learned from that experience.

He’s more prepared today than ever before.

Do you think it’s a coincidence that Russia inked a 30-year gas deal via a new pipeline recently?

However, the situation gets much worse for some members of the EU.

Europe’s Messy Energy Crisis Is About to Get Worse

At some point, you have to wonder how Europe can possibly unshackle itself from the chains of foreign energy dependence.

Of course, it’s easier for some. France gets roughly 70% of its electricity from nuclear power, which accounts for over half of all the EU’s nuclear-generated electricity. 

Perhaps that’s why Emmanuel Macron isn’t sweating as much as German Chancellor Olaf Scholz. 

You see, Scholz is in a bit of a bind.

Last year, Germany received its electricity mostly from wind, coal, nuclear, and natural gas.

But let’s push aside the 27% of electricity that Germany gets from wind, which comes with its own issues over intermittency. 

In its efforts to “green clean” the country’s energy dynamic, Germany shut down three of its six nuclear plants just five weeks ago. Within the next year, the rest of them will be shuttered. 

Add to this mix the complete phasing out of Germany’s coal power by 2038 (three coal plants are going offline within the next two years), and it’s easy to understand how messy things can get when Putin shuts off the gas.

All I can say is the wind had better not stop blowing.

Remember, if Russia shuts off gas exports through Ukraine, Germany will feel the sting. That’s because the gas it receives from Russia can’t be easily replaced.  

At this point, something has to give. 

Depending on Putin’s resolve, one of two things is going to happen. 

Either the Germans will reverse course on their decision to abandon and/or delay plans to construct LNG terminals along the North Sea… 

Or they’ll take a page from Romania, where the U.S. is helping develop small-scale nuclear reactors. 

A few months ago, NuScale Power inked a deal with Romania’s state nuclear company to develop small modular reactor (SMR) technology in the country. And after seeing China advance its own SMR projects last summer, it’s hard to imagine other countries won’t soon follow suit. 

And that, dear reader, is where a massive opportunity lies for individual investors like us. 

Except the circumstances may be different than most think.

You see, my readers and I know that the real money isn’t going to come from the big players building SMRs around the world. 

No, it’ll be from fueling them.

You HAVE to check this one out for yourself.

Until next time,

Keith Kohl

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A true insider in the technology and energy markets, Keith’s research has helped everyday investors capitalize from the rapid adoption of new technology trends and energy transitions. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital, as well as the investment director of Angel Publishing’s Energy Investor and Technology and Opportunity.

For nearly two decades, Keith has been providing in-depth coverage of the hottest investment trends before they go mainstream — from the shale oil and gas boom in the United States to the red-hot EV revolution currently underway. Keith and his readers have banked hundreds of winning trades on the 5G rollout and on key advancements in robotics and AI technology.

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