Russia, Senator John Cornyn, Steve Bannon discussed on Bloomberg Daybreak Europe
Create a precedent that the Department of Justice can execute a search warrant against former president when alternative means to accomplish the same result would have been available. That was Texas Republican senator John cornyn warning of the president set by the FBI's raid on Mar-a-Lago. Now on unrelated charges former White House Steve Bannon is expected to face criminal charges in New York for allegedly misusing campaign finance. Russia wants to buy millions of rockets and artillery shells from North Korea to use in its war against Ukraine. U.S. officials say it's a sign that western sanctions on its military and financial system are starting to bite. Deputy treasury secretary Wally adeyemo says Russia's economy faces years of hardship as a result of the measures taken by the U.S. and its allies over president Vladimir Putin's invasion of Ukraine. Here's what he told Bloomberg television's balance of power with David Westin. The Russia's economy is in a great deal of pain because the sanctions that we've implemented with 30 other countries. And the pain is going to continue for years to come. And it's going to hit Russia's revenues. And it's going to decrease those revenues over time. That was U.S. deputy treasury secretary Wally adeno speaking to Bloomberg. Okay, those are some of our top stories for you this morning. Let's return to the energy crisis though. The European situation has really taken a turn for the worse this week after Russia cut off north stream gas supplies, although prices this morning are starting to cool, and that's possibly because European households will benefit from at least €375 billion in government aid. European countries also talking about support for power providers and energy traders amid growing margin cause all of this ahead of that crucial EU, energy ministers meeting to discuss emergency measures on Friday. Joining us now is Bloomberg's energy reporter Stephen stepinski, great to have you with us Stephen. What are European countries now trying to do to safeguard the energy markets themselves credit lines collateral liquidity that's becoming a problem? Absolutely. I mean, they're looking at giving companies much more money, sort of bailouts and a lot of ways because they're really struggling to stay afloat in Germany has bailed out uniform or they're they could be able to vote for a third time beyond that you're looking at a lot of different companies asking for support from the government. And that's coming across the board. I mean, I think another thing to look at is what are the policy measures they're trying to implement. Germany wants a power price cap within weeks, Poland is taking to limit prices on all natural gas imports and Spain says that they need to do more to provide adequate financing for their utilities. A liquidity has been the main thing because with these margin calls so high in the futures market, a lot of companies just can't trade. It's just too expensive plus they're on the wrong side of some trade so they move some money as well. So they need to support to provide some more trading back to the market and get that core curve more liquid and that could potentially break things down. How are you seeing natural gas prices react and amid this huge volatility? You know, we are in this downward trend that seems. I mean, when you look at the risk factors, the biggest risk was always Nord stream would be shut off. And now it's shut off. So what leverage does Russia have left to kind of put pain on Europe? And there are a few, but they're leverage has been falling. So because of that, perhaps the market thinks that there really isn't any outside risk until the winter. And the winter's risk is it going to be cold. If it's cold and inventories are not adequate levels or they start to be depleted rather quickly, then where in a situation where we could see natural gas near surge again to record high levels. Okay, we've had some commentary out from Vladimir Putin this morning. At an eastern economic forum in Vladivostok, the line, give us turbines and will turn on Nord stream tomorrow, but they won't give us anything. Is this bluster that this has not been given much credibility in the past by the EU? What do you make of Putin's comments today? You know, I think it's a difficult situation. It's sort of, he said, he said, and then he said sort of thing, where you ever been officials from Germany and the UK are saying one thing, whereas Putin is saying another. Now we've done some reporting at Bloomberg that says that Russia is using this as an excuse. To provide an opportunity for them to put some pain on the European Union because of their support for Ukraine. Now, of course, you have to look at the situation. There are sanctions against Russia and it does make perhaps exporting or providing delivery of these equipment more difficult, but it does look like Germany and females, all these other companies involved are trying to do as much as they can to get this basically resolved and it appears to be more on Russia's side, it would play into them because if they wanted to declare a force majeure, where they have liability for not delivering, this is one opportunity to do that. If it was the fault of someone else not their own, that provides them with that cover. And of course, Siemens seem as energy, I should say, is on the record as saying that the findings of Gazprom to do with these turbines are wouldn't be a reason to stop gas flows. COVID provide any sort of template for Europe in terms of dealing with these external shots, just very shortly, very quickly. Yeah, I mean, they have worked together in the past on virus measures and things like that. And you have seen in Europe, them coming together to face this big existential threat. But when it comes to commodity energy and fuel, people tend to turn very insular and they want to protect what they have. And they might not be as willing to share. We've seen that before with other commodities over the last year in different countries. But perhaps it might not be the lesson that they need. Okay, Steven, thank you so much for being with us, Bloomberg's energy reporter Stephen statue, coming up in the next part of Bloomberg daybreak, Europe. Global macroeconomist at fidelity international Anastasia will be with us. This is Bloomberg.