To fully understand the crisis in the Ukraine we have to look no further than the existing energy policies both in Russia and in the Ukraine. For years now the Ukraine has been buying Russian shale gas. With the recent pact in 2009 that stipulated Ukraine would for 10 years by Russian Gas at $400 per thousand cubic meters of fuel is a very significant factor involved in the escalating tensions .Considering the economic conditions in the Ukraine have been deteriorating for some time the price they pay for their energy has become an albatrosses stifling the economy and draining an already drained treasury. It didn't help either with a very corrupt government led by it's former President whose opulent lifestyle only heightened the worsening economic conditions in the area.
History is full of rebellions where citizens rise up because they have become so destitute and find that the only recourse left is open rebellion to right the wrongs imposed upon them by tyrannical and corrupt governments. In the Ukraine corruption on a grand scale for the past few years only accelerated the move to restore some stability in a country already besieged by deteriorating economic conditions. The timing of this coupe to throw out former president Viktor Yankovich was instrumental in having Russian President Putin seize the moment to try to regain the Crimea region. A move to reestablish Russian authority in a region populated mainly by Russian's anyway.
When the new provincial government undertook the move to regain some energy independence and provide lower cost energy to the citizens of the Ukraine they did so by brokering an agreement with the West mainly Chevron. This move was intended to void the original 2009 contract with Russia. But, by doing so only infuriated Russian President Putin and opened up the door for Russia to seize control in Crimea. All because of existing sources of fossil fuel energy supplies. The biggest factor in all this is because former President Yankovich was a loyal supporter of Russian President Putin. So when the new provincial government took over they felt that the 2009 energy contract with Russia was invalid and not in their best interest.
The crisis in the Ukraine comes as real no surprise to many who follow the past years policy decisions by the President Putin. Before this orchestrated coupe the government of the Ukraine had virtually bankrupted the country. Today, that the economic situation is so precariously close to collapsing. We have seen it all through history that when a nation becomes so destitute flames of rebellion are ignited. The recent change of events in the Ukraine have only been a repeat of history. Now, with a transitional government in place hoping to bring some semblance of stability only to find a country bankrupt is a very harsh reality to face. The prospect for that renewed stability has become so elusive now especially with Russia trying to regain control of a region in a country that was once part of the former Soviet Republic.
When we take a closer look at the real reason why President Putin is so aggressive in policy decisions that have only created more tensions not only in the Crimea region but with the rest of Europe and the United States it all boils down to oil and existing energy policies.The new provincial government have announced that the country is bankrupt. Not surprising considering that former President Yankovich was so corrupt. With the country so destitute the prospects to go further in debt with the upcoming expenses to stabilize an already destabilized country is as real as it gets. By this July, the Ukraine will have to pay over $415 billion dollars of debt not including interest.
A country on the verge of a crisis unparalleled in recent times even this new provincial government is so fragile that the collapse of this new government and country could happen at any moment. With Russia freezing their financial aid remaining at $12 billion means that the Ukraine must look to the IMF and the World Bank. The United States has already pledged over $1.5 billion money that by the way we can ill afford to send anyway, but nevertheless we continue to meddle in affairs that only interest those who benefit the most. That being the oil conglomerates and not the majority people of the United States and the citizens of the Ukraine either.
Currently the IMF have put very stringent conditions of any loan guarantee. Meanwhile the people of the Ukraine are faced with very limited bank withdraws much like what is imposed here in the United States with the latest data breach incidents. Banks in both countries have put withdrawal limits on individual bank accounts. All this amounts to is a protective measure to slow down the so called capital flight, otherwise known as direct withdrawals from individual accounts that have been occurring. Though things have not progressed to the point that they are in the Ukraine here in the United States the impact that banking policies now impose in both countries just guarantees banks remain somewhat solvent.
When we have political leaders that sanction harsh financial repercussions against Russia just opens up a Pandora's box of reprisals that will have far reaching implications on a global scale. Given that Russia has no intentions of backing down regardless of all the financial posturing against their assets here in the US. To avoid any more hostilities that have now been created the United States has to embark immediately on ushering in alternative fuel sources. That includes producing solar gas, and putting on line more solar and wind farms. We also have to vastly improve our energy grid to handle all our increasing energy needs so that in the advent of any disaster energy will not be disrupted.
We have the resources, the capabilities, the technology all we lack is the backbone of governmental officials to get off the oil and fossil fuel bandwagon. A bandwagon that only secures more power and control over nations but does little to ease the escalating deplorable economic and financial conditions that remain for the majority of people everywhere.