Hey everyone, Peter Zeihan here coming to you from Chile, Colorado. The news is that last week on Tuesday the 20th, I believe, a series of explosions hit a couple of pieces of Russian infrastructure in the Far East in South Eastern Siberia, specifically the Sermo ski tunnel, which is part of the Trans Siberian network, specifically in the Balko Ionomer Main Line, were hit. And then a few hours slash a day later details are a little fuzzy. A similar line in the vicinity of the tunnel was also hit, which is serves as the backup for the tunnel this place that they called the devil’s bridge, some anonymous, Ukrainian security officials have claimed responsibility for the attack, I can’t tell you if that is true or not, what I can say is that we’ve got three things going on here. Exports, options and maintenance. So first exports, since the Ukraine war began, the Russians have and have had it more and more difficult to get their product to market. The Europeans were the natural market, they were the closest for most oil and gas, even a lot of the minerals. And so when they decided, for whatever reason to stop buying it, a lot of the stuff ended up in China. And for that the Trans Siberian rail system is critical, provides probably 80% of the cargo capacity for land based stuff, and more stuff is going on land than ever before. Also, all of these lines of which there are basically five, you’ve got one that’s the least important that kind of goes down into Kazakhstan before going over into our Merchant jjang. That’s the least used and the most Frankenstein, the other for all parts of transmitted Siberian system that just crossed over the mountains and the passes into China at different places. But all of them collectively, are the only way to get things to China. And they’ve all been running at more than 100% capacity, which you know, we’ve been kind of waiting for a safety situation to boil up to knock things off line. And now it’s been done at least in part by an attack.
And when a blade is being used at more than 100% capacity, that means you can’t just ship it to alternatives. Even if you’re willing to turn your train around for a feat really can’t you backup the train to get to a depot. Anyway, point is that one of the four lines, at least for the moment is offline completely. Second options, you got these four lines when the crosses through
Mongolia, two that go into northeastern China, and one that goes all the way over to the Russian Far East where things can be kind of repackaged, and put on ships.
No one lives in Siberia because they want to I mean, there’s a reason why this is where all the prison colonies were.
Some of the more stable lines like the BLM line that was hit or on permafrost, which is not particularly stable, something happens to the permafrost, the whole thing just kind of sinks in. And it looks like at least on one of these attacks, a railcar that was full of fuel was hit. So we’ve seen in other parts of the conflict in Ukraine, how that can go bad really, really quickly.
Because of this, there are not a lot of population centers along this entire route. In fact, less than 10% of Russia’s population lives along this line. Everybody else is on the western Russia where it’s you know, warm. And because of that finding repair crews in the first place might be really difficult. You’re dealing with a lot of tunnels, a lot of bridges, a lot of Kenyans a lot of permafrost, a lot of territory where if there is damage, you don’t just slap down some fresh line and start up. I don’t know it takes years.
When this line was built back in the 70s and 80s, the Russians wouldn’t even allow any foreign observers to see it because it was so shoddily put together, and it could only operate reliably over about a third of its length. And this was when the Soviets actually had engineers, a post Soviet Russia really doesn’t. And as we’ve seen with the courage Bridge, which connects the Russian mainland to Crimea, you know, that was hit over a year ago now. And it’s still not running at full capacity. So doing repairs in this area is no minor issue. Of course, getting information out of this area is no minor issue as well. I do a third maintenance. The Russian educational system collapsed 3035 years ago, and so there aren’t a lot of people who are I would consider to be fully capable of claiming the term engineer. In fact, the younger of them turn mid 60s this year. Also everyone that the Russians have who can repair physical infrastructure is in the Ukraine theater right now because the Ukrainians have been blowing up a rail depots and rail lines and bridges and roads and everything for a year and a half now. So there just isn’t a lot left that the Russians can use if all of a sudden they’re getting hit on a very, very exposed vulnerable place 4000 miles east of Moscow.
If this was the Ukrainians, or really if this was anyone who really means the Russians, ill will. This is an excellent strategy because the Russians barely have the military capacity to patrol their own lands in western Russia but in Ukraine
Much less 4000 miles the other direction 5000 miles the other direction. This is something that can really hit to the heart of their economic plans in a post war scenario, because if they can’t get the stuff to the Chinese, the Chinese aren’t gonna pay for it.
And there’s really only three other lines now that this stuff can be shipped. And so if this is real, we’re gonna find out about are really, really fast because there’s just so many points of exposure and to so many failure points throughout this part of the Russian system. It’d be an easy way to take down the Russian economy, far more effective than anything we’ve seen with sanctions so far. All right, that’s it. Stay warm.