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Shell Aims to ‘Decarbonize Profitably,’ Its New Energies US CEO Says

Hart Energy

Shell Aims to ‘Decarbonize Profitably,’ Its New Energies US CEO Says

Velda Addison – October 9, 2023

Shell’s strategy has not changed as the company remains focused on delivering more value with less emissions, Shell New Energies US CEO Glenn Wright said this week, addressing unease about its position in the energy transition.

“In order for that to be a reality, it’s imperative that what we do is both economically viable, socially acceptable and environmentally sustainable,” Wright said Oct. 5 during an event co-hosted by the Baker Institute Center for Energy Studies and Baker Botts LLC in Houston. “Those are the three legs of the stool. If any one of those legs fails, the solution fails. So, our aim … is to continue our work and to decarbonize profitably.”

The comments were delivered in response to concerns that the supermajor was scaling back investments in renewable energy. Focused on increasing returns, Shell said it will hold oil output steady through 2030, having hit a lowered oil production target early through divestments.

Shell, which is targeting net-zero emissions by 2050, continues progress on providing cleaner energy solutions as energy demand rises, Wright said, pointing out how the company is repurposing the footprint of its energy and chemical parks. Shell’s low-carbon investment plans include investing between $10 billion and $15 billion through 2025 in areas such as biofuels, hydrogen, electric vehicle charging and carbon capture and storage.

“In my business, we will continue to invest in power opportunities, but we will do so in areas and spaces where it makes economic sense to do so and where we are incentivized to do so,” Wright said.

Energy companies, including Shell, are under pressure to not only provide affordable energy safely and lower emissions, but also increase returns for the shareholder. However, inflationary pressure and supply chain issues have posed obstacles, especially for offshore wind.

While the company has pulled out of some wind projects, including two wind projects offshore Ireland, it has powered forward with other investments. These have included the acquisitions of renewable natural gas company Nature Energy and Sprng Energy, a solar and wind power supplier, as well as starting construction on one of Europe’s largest renewable hydrogen plants.

The renewables investment comes alongside continued oil and gas production.

Shell New Energies CEO — “We will continue to invest in power opportunities, but we will do so in areas and spaces where it makes economic sense to do so and where we are incentivized to do so,” Shell New Energies US CEO Glenn Wright says. *(Source: Baker Institute)*

Protecting the core

Determining where to invest capital is probably the biggest question in boardrooms today, said Michael LaMotte, senior managing director for Guggenheim Securities. Speaking about E&Ps’ limited capital investment and moves to pay down debt and pay dividends, he said companies in the industry should protect the core first.

“Identify that and focus on it because that’s where all that cash comes from at the end of the day,” said LaMotte, who spoke on a separate panel. “The return on your capital is going to be enhanced if you improve the efficiency of the operations in and around that core.”

It is also important to think about creating long-term value. Despite views on the pace of the transition, the “transition is here and we are in it.” He spoke of the need for companies to leverage core competencies into new energies.

Many are doing just that. Think Occidental Petroleum Corp. in the carbon management space.

“[It’s] really important how to think about taking what feels like a liability, what feels like a compliance cost to the business, and flip it on its head and say, ‘okay, this is actually a new business opportunity,’” LaMotte said, acknowledging the core is not leaving anytime some.

Sharing similar sentiments as Wright, LaMotte added that investments must be economic with focus on obligations to shareholders to generate a return.

“But it also has to be cleaner. It’s striking that balance” between protecting the core and focusing on something new and cleaner to leverage competitive advantages.

By 2050, the world’s population is expected to exceed 9 billion, nearly 2 billion more people than today, Wright said. Energy demand will likely double.

“We must find ways to profitably decarbonize. I cannot emphasize that enough. We aim to decarbonize, but we must do so profitably,” Wright said. “And we must work closely with others in new ways because we can only reach net zero if society reaches it, too.”

Pumping up power

The most profound change and fastest growth will happen in the power sector, according to Wright. Shell deepened its position in the renewable power space with its 2021 acquisition of Savion, a large utility-scale solar and battery energy storage developer, and the 2022 launch of its residential retail business in Texas. The company manages more than 8 gigawatts of power generation across North America.

“Electricity is far and away the easiest energy source to decarbonize. Every energy consuming sector, which is everybody from road transport to home and commercial heating and cooling, to manufacturing and major industrial processes, is actively pursuing electrification in some fashion,” Wright said.

Like others in energy, he says reform is needed—particularly regarding access to interconnections and transmission reform—as more renewable energy lines up to flow to the grid.

“FERC Order 2023 starts to help us in this regard. … How this will play out will continue to unfold, but it will encourage and allow quicker access to bring renewables online,” Wright said. “We also need to ensure that the market design encourages resource adequacy. We can encourage certainly the development of renewables. What’s important is that these assets are located in the right places at the right time.”

Power grids in parts of the U.S.—including the Electric Reliability Council of Texas—experienced stress this summer amid high demand and temperatures, which prompted some conservation alerts.

“As we see more and more renewables come onstream, we need more and more resources that can provide ancillary services that can help firm those renewables and ensure that the grid continues to operate,” Wright said.

BP says it remains committed to financial, climate ambitions

Reuters

BP says it remains committed to financial, climate ambitions

Ron Bousso – October 10, 2023

FILE PHOTO: Logo of British Petrol BP is seen at a petrol station in Pienkow

LONDON (Reuters) -BP said on Tuesday it remained committed to its financial and carbon reduction ambitions, as interim Chief Executive Officer Murray Auchincloss hosted an investor day in Denver.

It was Auchincloss’s first major investor event since taking the helm after Bernard Looney abruptly stepped down as CEO last month for failing to fully disclose relationships with colleagues.

“BP’s strategy, financial frame and net zero ambition are unchanged,” the energy group said in a statement.

“BP remains focused on delivering its strategy safely, with disciplined delivery, quarter-on-quarter, to meet 2025 targets and 2030 aims.”

The company aims to achieve zero net carbon emissions by 2050 and to invest billions in renewable and low-carbon power. In February, BP scaled back plans to reduce oil and gas output by 2030 to 25% from 40% from 2019 levels.

In the presentation, BP also raised its forecast for earnings before interest, taxes, depreciation, and amortization (EBITDA) from oil and gas businesses for 2030 by $2 billion to $41 to $44 billion at an average oil price of $70 a barrel.

EBITDA for the whole company, including its renewables and low-carbon businesses, is now forecast to reach $53 to $58 billion, compared with $51 to $56 billion previously.

(Reporting by Ron Bousso;Editing by Tomasz Janowski, Susan Fenton and Emelia Sithole-Matarise)

In the GOP Extremist Hamas-Israel Rhetoric Sweepstakes, Marco Rubio Takes Early Lead

The New Republic

In the GOP Extremist Hamas-Israel Rhetoric Sweepstakes, Marco Rubio Takes Early Lead

Tori Otten – October 10, 2023

Senator Marco Rubio had a terrifying suggestion for how to resolve the war between Israel and Palestine: eradicating the Gaza Strip.

Fighting broke out on Saturday when Hamas launched a surprise airstrike attack on Israel. Israel has since responded in kind, imposing a total siege on the Gaza Strip, cutting off food, water, and electricity. At least 1,800 people have been killed on both sides—and the death toll is expected to keep rising.

During a Monday night interview on CNN, host Jake Tapper asked Rubio if there was a way to stop Hamas “without causing massive casualties against the innocent people” in Gaza.

“I don’t think there’s any way Israel can be expected to coexist or find some diplomatic off-ramp with these savages,” Rubio replied. “These are people, as you’ve been reporting and others have seen, that deliberately targeted teenage girls, women, and children, and the elderly.… Just horrifying things. And I don’t think we know the full extent of it yet. I mean, there’s more to come in the days and weeks ahead. You can’t coexist. They have to be eradicated.”

While Rubio was referring to Hamas, his unwillingness to differentiate between the militants and innocent Palestinian civilians is terrifying. Two million people live in Gaza, and more than half of them are children. Rather than give a nuanced response, Rubio instead seemed to be OK with wiping out an entire region.

“This is going to be incredibly painful. It’s going to be completely difficult. And it’s going to be horrifying, the price to pay.”

Rubio’s comments echo a statement earlier Monday from Israeli Prime Minister Benjamin Netanyahu. The far-right leader swore to completely “change the Middle East” over Hamas’s attack.

What Ukrainian Soldiers Really Think of Trump and the GOP

The New Republic

What Ukrainian Soldiers Really Think of Trump and the GOP

Ben Makuch – October 9, 2033

Two Ukrainian soldiers fire a mortar in Bakhmut, where some of the fiercest fighting of the war has taken place. TYLER HICKS/THE NEW YORK TIMES/REDUX

For starters: “Donald Trump is a fucking asshole.”

“Donald Trump is a fucking asshole,” said Anatolii, a soldier in the Ukrainian Territorial Defense Forces. The leaves are changing, and it’s a chilly fall day in Bilopillya, a village in the Sumy region where you can see Russia a few kilometers away. “That’s what I think of him.”

His brigade defends flat farmland that wouldn’t be out of place in a Tolstoy novel—except the endless, rolling scene, laced with crops and thickets of trees, is heavily mined and pockmarked with artillery blasts.

The question of who will become U.S. president in 2024 is far from his mind. Anatolii is one of a few soldiers in his brigade, made up of other locals, who defend the Ukrainian border with Russia. On any given day, he deals with barrages of artillery, Grad rockets, the pings of gunfire, and the occasional missile, one of which took out a local school in March.

“The problem is, they never give us enough weapons,” he told me in an almost exasperated tone about U.S. and NATO arms transfers. “If he comes back and what? Give us none again?” Many in the Ukrainian military and government already feel that they are not receiving enough military aid. The stakes of the nascent Republican primary, which has been defined by isolationist rhetoric, are potentially dire.

Back in Kyiv, sitting in a hipster bistro near the banks of the Dnipro River, I find it tough to remember that, less than 48 hours ago, a swarm of Iranian-designed Shahed drones were shot down overhead, the debris landing near baroque architecture and cobblestoned streets.

I’m in a casual conversation with a Ukrainian official in the upper brass of Kyiv’s military effort. The war, he and his colleagues believe, is far from over. The need for continued support from the West is vital.

“For now, it’s going to be the same, then up and down,” he said to me, referring to the kinetic energy of a conflict that has grinded to mostly a standstill as Ukraine’s counteroffensive crawls on in the east. “But in Donbas, there is always going to be crazy shelling and missiles all day long.”

Spilling in and out of the American news cycle, the war in Ukraine has settled into its moodier, teenage era: One moment you might be sipping coffee on a sunny, cloudless day in the picturesque capital city, safely sitting on a cushioned seat; the next, it could be raining missiles in the distance, with air sirens singing for you to get into a shelter.

The consensus among Ukrainians is that the duration of the fight is indefinite, with no peace deal in sight. Stateside, the question of what to do about a war that has settled into a stalemate has become one of the most divisive issues in the ongoing Republican primary. Trump, the front-runner, has long complained that the war is too expensive, and that he could simply end it if reelected; his copycats, Vivek Ramaswamy and Ron DeSantis, have largely followed his lead. The party’s establishment wing, all languishing in the single digits, has backed continued financial and tactical support for the war effort.

Whatever path the immediate future of the war takes, recent chatter from the GOP primary has U.S. and, especially, Ukrainian intelligence and military figures theorizing about what the future of the conflict might be should Republicans retake the presidency.

The main concern? The $44 billion worth of weaponry (and counting) that has been essential to Ukrainians’ ability to stall Russian advances and carry out some of their own.

There isn’t yet any level of overt panic about what the future holds. But there is a sense of vigilance and preparation for the worst-case scenario.

One American ex-Marine, a foreign volunteer who trains Ukrainian soldiers in combat, told me that the Ukrainian officers he schools in places like the Donetsk region are well aware of what a Republican president could mean for the war effort.

“Anyone on the front lines who reads English-language media and follows either U.S. elections or news around the funding is aware that Republicans potentially want to pull the plug,” he said, keeping his anonymity in order to protect against possible Russian reprisals. “They know that 2024 is potentially a big, big problem, and they have objectives to hit in the counteroffensive to make sure they’re comfortable in case Trump wins, then stops the weapons transfers.”

But, oppositely, the same Ukrainian official at the bistro shares the uncanny confidence in American resolve that his president, Volodymyr Zelenskiy, expressed to The Economist in September. Shrugging off a question about the possible consequences of Trump returning to power, Zelenskiy insisted that a President Trump would “never” take an action supporting Vladimir Putin: “That isn’t what strong Americans do.”

“I think Trump would keep giving us the weapons,” the Ukrainian official told me flatly, explaining that the consequences of withdrawing support would be so profound that they make it unlikely for any leader—even one as vociferously isolationist as Trump—to fully pull out.

“They have already given so much money and weapons for our war, if [the Republicans] take over and Ukraine turns into a disaster, they would be responsible for that, just like [President Joe Biden was] in Afghanistan,” he said, referencing America’s disastrous summer 2021 withdrawal, which started the current president’s slide in the polls.

So far, the Department of Defense has unleashed a torrent of weapons transfers to Ukraine that have proved essential in the fight against a Kremlin war machine that is vastly better armed and manned. Everything from Javelin anti-tank missile systems, to the infamous Stingers used by the mujahedin during the Afghan-Soviet war, to F-16 fighter jets and M1 Abrams tanks has been promised in increasingly bolder Pentagon and allied packages.

It isn’t just national Republicans who have begun to question the scale of support for the war—skepticism is growing in other NATO countries as well.

“Everywhere some politicians are using Ukraine to make support for their cause,” said one senior Ukrainian officer with knowledge of war planning. “The American people must know it is much cheaper for us to fight than for you to fight.”

To him, the conflict is already a quagmire for Russia on par with that of the Afghan-Soviet war. But ending aid could quickly reverse that. The same soldier, almost doubting himself, was frank and saw the pitfalls of a Republican win.

“Of course, our fighting costs a lot of money, and we know there are no security guarantees if Trump wins.”

It is possible, however, that opinion on Ukraine will shift as the Republican primary progresses and the candidates continue to appear at monthly debates—especially since Trump, the most prominent voice against U.S. support for Ukraine, has thus far declined to participate. Still, Trump’s prominence and level of support could draw even more Republicans to question the war.

A growing number of Republican voters oppose further aid to Ukraine, and there’s good reason to believe that figure will rise as the primary process and the accompanying debates drag on.

Perhaps the most extremist take on Ukraine in the primary comes from the oft-arrogant Ramaswamy, who has made the outlandish demand not only for the dismantling of the FBI, but also for granting Russia Ukrainian territory. The pharma-businessman has gone so far as to label the Biden administration’s current posture “disastrous” and has declared that military resources for Ukraine should be redirected “to prevent the invasion of our own southern border” with Mexico.

But a Republican president might not be catastrophic for the Ukrainian war effort. Lucas Webber, cofounder of the Militant Wire research network, concurred. “It is unlikely, even if Trump truly means what he says, that he would be able to shift America’s Ukraine policy in any meaningful way,” Webber told The New Republic over email. “The U.S. political elite and security establishment consensus on Ukraine will leave Trump very little room to maneuver, as seen during his first term. Moreover, it is also highly improbable that either Ukraine or Russia would accept anything remotely resembling the territorial status quo on the battlefield.”

There have been efforts to push back, however. Former Vice President Mike Pence has made support for Ukraine a major campaign issue that he’s used to hammer his rivals, particularly DeSantis, whom he has attacked for minimizing the conflict.

“I know that some in this debate have called the war in Ukraine a ‘territorial dispute,’” said Pence, directly quoting comments the Florida governor made in March 2023.

“It’s not; it was a Russian invasion, an unprovoked Russian invasion. And I believe the United States of America needs to continue to provide the courageous soldiers in Ukraine with the resources they need to repel that Russian invasion and restore their territorial integrity.”

Even if the Republicans commit to a total withdrawal of aid to Ukraine, it is possible that contingencies will be put in place should Biden know his presidency will be coming to an end. If Biden loses in 2024, weapons could be sent over right before the Republicans take the White House.

Whatever position on the war the eventual Republican presidential candidate takes, there is no denying one simple fact: If Ukraine loses to the despotic Putin regime, it not only would bolster autocrats around the world (or perhaps even herald the renormalization of imperial conquest) but also would undoubtedly weaken the West.

But if Biden can hold out, perhaps all the fears surrounding an end to the arms flow to Ukraine will be for naught. NATO and the EU want to continue thinking of themselves as global leaders, both militarily and economically. The loss of Ukraine after so much was spent to save it would be the crack in their castle that countries like China and its allies will see as a further sign of the decline of the West.

“Trump is not coming back,” Anatolii said to me at the end of a long week manning checkpoints. “I don’t think so.”

For the fate of Ukraine, he’d better hope he’s right.

Ben Makuch is a national security reporter and former correspondent for VICE News Tonight. His reporting has taken him to the Middle East, Pakistan, Russia, and Ukraine, where he has covered the war since 2016. He hosted the 2022 podcast American Terror, about far-right extremism in the United States.

Israel Attacks Condemned by President Biden as TV News Plans Special Reports: ‘Terrorism Is Never Justified’

Variety

Israel Attacks Condemned by President Biden as TV News Plans Special Reports: ‘Terrorism Is Never Justified’

Michaela Zee – October 7, 2023

Hamas militants launched a surprise attack on Israel Saturday, in which they fired thousands of rockets, sent dozens of fighters into Israeli towns near the Gaza Strip and kidnapped Israeli civilians and soldiers. The attacks started during a religious holiday weekend in Israel, and nearly 300 people have been killed, according to the New York Times.

President Joe Biden shared a statement regarding the attacks against Israel: “This morning, I spoke with Prime Minister Netanyahu about the horrific and ongoing attacks in Israel. The United States unequivocally condemns this appalling assault against Israel by Hamas terrorists from Gaza, and I made clear to Prime Minister Netanyahu that we stand ready to offer all appropriate means of support to the Government and people of Israel. Terrorism is never justified. Israel has a right to defend itself and its people. The United States warns against any other party hostile to Israel seeking advantage in this situation. My Administration’s support for Israel’s security is rock solid and unwavering.”

Vice President Kamala Harris posted a statement on X/Twitter, writing that Biden’s and her support for “Israel’s security is unwavering.”

Doug’s and my prayers are with the victims of the heinous terrorist attacks in Israel. @POTUS and my support for Israel’s security is unwavering.
— Vice President Kamala Harris (@VP) October 7, 2023

NBC News broadcast a special report on the Hamas’ surprise attack at 6 a.m. ET, featuring “NBC News Now” anchor Joe Fryer and NBC News senior legal correspondent Laura Jarrett. They were joined by NBC News foreign correspondents Raf Sanchez and Richard Engel and foreign affairs correspondent Andrea Mitchell.

“We haven’t seen something like this, this level of sophistication, to catch the Israelis off guard and to keep this operation moving for hours now. This began at dawn, its is already afternoon in Israel. So, this has been going on for multiple hours now,” said Richard Engel, NBC News chief foreign correspondent, during Saturday’s special report. “I think it’s very likely that we’re going to see an escalation in some sort of small-scale war, maybe bigger scale war, between Hamas and Israel. And I think we’re in the early phases of that right now.”

MSNBC announced the news channel will continue live, ongoing coverage of the latest developments in Israel, with Ayman Mohyeldin anchoring coverage live from New York starting at 8 p.m. ET. and José Díaz-Balart picking up coverage from 11 p.m. to 2 a.m.

Fox News Channel is also presenting continuous coverage of the developing conflict in Israel, with FNC foreign correspondent Trey Yingst reporting live from southern Israel. FNC chief political anchor and “Special Report’s” Bret Baier will contribute to live coverage throughout the day, while chief national security correspondent Jennifer Griffin will report from the Pentagon with correspondent Lucas Tomlinson reporting from the White House.

NewsNation will present a special edition of “NewsNation Prime” to cover the war in Israel and the Gaza Strip from 7 to 10 p.m. ET. Chief Washington anchor Leland Vittert will co-anchor from Washington D.C. with “NewsNation Prime’s” Natasha Zouves and “The Hill’s” Blake Burman live from the White House.

CNN chief Washington correspondent Jake Tapper will anchor “CNN Special Coverage: Israel at War” from 9 p.m. to 12 a.m. ET. CNN’s Nic Robertson is covering live from Ben Gurion airport in Tel Aviv.

Hamas surprise attack out of Gaza stuns Israel and leaves hundreds dead in fighting, retaliation

Associated Press

Hamas surprise attack out of Gaza stuns Israel and leaves hundreds dead in fighting, retaliation

Josef Federman and Issam Adwan – October 7, 2023

People look at the damage from a rocket fired from the Gaza Strip in Tel Aviv, Israel, Saturday, Oct. 7, 2023. (AP Photo/Moti Milrod)

Fire and smoke rises following an Israeli airstrike, in Gaza City, Saturday, Oct. 7, 2023. The militant Hamas rulers of the Gaza Strip carried out an unprecedented, multi-front attack on Israel at daybreak Saturday, firing thousands of rockets as dozens of Hamas fighters infiltrated the heavily fortified border in several locations by air, land, and sea, killing dozens and stunning the country. Palestinian health officials reported scores of deaths from Israeli airstrikes in Gaza. (AP Photo/Fatima Shbair)

Palestinians inspect the rubble of a building after it was struck by an Israeli airstrike, in Gaza City, Saturday, Oct. 7, 2023. The militant Hamas rulers of the Gaza Strip carried out an unprecedented, multi-front attack on Israel at daybreak Saturday, firing thousands of rockets as dozens of Hamas fighters infiltrated the heavily fortified border in several locations by air, land, and sea and catching the country off-guard on a major holiday. (AP Photo/Fatima Shbair)

An Israeli woman react over the body of her relative who was killed by Palestinian armed militants who entered from the Gaza strip, in the southern Israeli city of Sderot, Saturday, Oct. 7, 2023. Hamas, the militant group ruling the Gaza Strip, carried out a surprise, multi-front attack on Israel at daybreak Saturday, firing thousands of rockets and infiltrating the country by land, air and sea. (AP Photo/Baz Ratner)

An Israeli soldier stands by the bodies of Israelis killed by Palestinian armed militants who entered from the Gaza Strip, in the southern Israeli city of Sderot, Saturday, Oct. 7, 2023. Hamas, the militant group ruling the Gaza Strip, carried out a surprise, multi-front attack on Israel at daybreak Saturday, firing thousands of rockets and infiltrating the country by land, air and sea. (AP Photo/Tsafrir Abayov)

JERUSALEM (AP) — Backed by a barrage of rockets, Hamas militants stormed from the blockaded Gaza Strip into nearby Israeli towns, killing dozens and abducting others in an unprecedented surprise attack during a major Jewish holiday Saturday. A stunned Israel launched airstrikes in Gaza, with its prime minister saying the country is now at war with Hamas and vowing to inflict an “unprecedented price.”

In an assault of startling breadth, Hamas gunmen rolled into as many as 22 locations outside the Gaza Strip, including towns and other communities as far as 15 miles (24 kilometers) from the Gaza border. In some places they gunned down civilians and soldiers as Israel’s military scrambled to muster a response.

Gunbattles continued well after nightfall, and militants held hostages in standoffs in two towns. Militants occupied a police station in a third town, where Israeli forces struggled until Sunday morning to finally reclaim the building.

Before daybreak Sunday, militants fired more rockets from Gaza, hitting a hospital in the Israeli coastal town of Ashkelon. The hospital sustained damage, said senior hospital official Tal Bergman. Video provided by Barzilai Medical Center showed a large hole punched into a wall and chunks of debris scattered on the ground of what appeared to an empty rooms and a hallway. There was no report of casualties.

Israeli media, citing rescue service officials, said at least 250 people were killed and 1,500 wounded in Saturday’s attack, making it the deadliest in Israel in decades. At least 232 people in the Gaza Strip were killed and 1,700 wounded in Israeli strikes, the Palestinian Health Ministry said. Hamas fighters took an unknown number of civilians and soldiers captive into Gaza.

The conflict threatened to escalate with Israel’s vows of retaliation. Previous conflicts between Israel and Gaza’s Hamas rulers brought widespread death and destruction in Gaza and days of rocket fire on Israeli towns. The situation is potentially more volatile now, with Israel’s far-right government stung by the security breach and with Palestinians in despair over a never-ending occupation in the West Bank and suffocating blockade of Gaza.

In a televised address Saturday night, Israeli Prime Minister Benjamin Netanyahu, who earlier declared Israel to be at war, said the military will use all of its strength to destroy Hamas’ capabilities. But he warned, “This war will take time. It will be difficult.”

“All the places that Hamas hides in, operates from, we will turn them into ruins,” he added. “Get out of there now,” he told Gaza residents, who have no way to leave the tiny, overcrowded Mediterranean territory of 2.3 million people.

Early Sunday, the Israeli military issued warnings in Arabic to residents of communities near the border with Israel to leave their homes and move to areas deeper inside the tiny enclave. In previous Israel-Hamas fighting on Gaza soil, the Gaza communities near the border were hit particularly hard, both by artillery fire and at times by ground incursions.

Gaza’s residents have endured a border blockade, enforced to varying degrees by Israel and Egypt, since Hamas militants seized control in 2007. Civilians are trapped and particularly vulnerable during wars and bouts of fighting.

Israeli airstrikes in Gaza intensified after nightfall, flattening residential buildings in giant explosions, including a 14-story tower that held dozens of apartments as well as Hamas offices in central Gaza City. Israeli forces fired a warning just before.

Around 3 a.m., a loudspeaker atop a mosque in Gaza City blared a stark warning to residents of nearby apartment buildings: Evacuate immediately. Just minutes later, an Israeli airstrike reduced one nearby five-story building to ashes.

After one Israeli strike, a Hamas rocket barrage hit four cities, including Tel Aviv and a nearby suburb. Throughout the day, Hamas fired more than 3,500 rockets, the Israeli military said.

The strength, sophistication and timing of the Saturday morning attack shocked Israelis. Hamas fighters used explosives to break through the border fence enclosing Gaza, then crossed with motorcycles, pickup trucks, paragliders and speed boats on the coast.

In some towns, civilians’ bodies lay where they had encountered advancing gunmen. At least nine people gunned down at a bus shelter in the town of Sderot were laid out on stretchers on the street, their bags still on the curb nearby. One woman, screaming, embraced the body of a family member sprawled under a sheet next to a toppled motorcycle.

In amateur video, hundreds of terrified young people who had been dancing at a rave fled for their lives after Hamas militants entered the area and began firing at them. Israeli media said dozens of people were killed.

Among the dead was Col. Jonathan Steinberg, a senior officer who commanded the Israeli military’s Nahal Brigade, a prominent infantry unit.

The shadowy leader of Hamas’ military wing, Mohammed Deif, said the assault was in response to the 16-year blockade of Gaza, Israeli raids inside West Bank cities over the past year, violence at Al Aqsa — the disputed Jerusalem holy site sacred to Jews as the Temple Mount — increasing attacks by settlers on Palestinians and the growth of settlements.

“Enough is enough,” Deif, who does not appear in public, said in the recorded message. He said the attack was only the start of what he called “Operation Al-Aqsa Storm” and called on Palestinians from east Jerusalem to northern Israel to join the fight.

The Hamas incursion on Simchat Torah, a normally joyous day when Jews complete the annual cycle of reading the Torah scroll, revived painful memories of the 1973 Mideast war practically 50 years to the day, in which Egypt and Syria launched a surprise attack on Yom Kippur, the holiest day of the Jewish calendar, aiming to take back Israeli-occupied territories.

Comparisons to one of the most traumatic moments in Israeli history sharpened criticism of Netanyahu and his far-right allies, who had campaigned on more aggressive action against threats from Gaza. Political commentators lambasted the government and military over its failure to anticipate what appeared to be a Hamas attack unseen in its level of planning and coordination.

Asked by reporters how Hamas had managed to catch the army off guard, Lt. Col. Richard Hecht, an Israeli army spokesman, replied, “That’s a good question.”

The abduction of Israeli civilians and soldiers also raised a particularly thorny issue for Israel, which has a history of making heavily lopsided exchanges to bring captive Israelis home. Israel is holding thousands of Palestinians in its prisons. Hecht confirmed that “substantial” number of Israelis were abducted Saturday.

Associated Press photos showed an elderly Israeli woman being brought into Gaza on a golf cart by Hamas gunmen and another woman squeezed between two fighters on a motorcycle. AP journalists saw four people taken from the kibbutz of Kfar Azza, including two women.

In Gaza, a black jeep pulled to a stop and, when the rear door opened, a young Israeli woman stumbled out, bleeding from the head and with her hands tied behind her back. A man waving a gun in the air grabbed her by the hair and pushed her into the vehicle’s back seat. Israeli TV reported that workers from Thailand and the Philippines were also among the captives.

Netanyahu vowed that Hamas “will pay an unprecedented price.” A major question now was whether Israel will launch a ground assault into Gaza, a move that in the past has brought intensified casualties.

Israel’s military was bringing four divisions of troops as well as tanks to the Gaza border, joining 31 battalions already in the area, the spokesman Hagari said.

In Gaza, much of the population was thrown into darkness after nightfall as electrical supplies from Israel — which supplies almost all the territories’ power — were cut off. Netanyahu’s office said in a statement that Israel would stop supplying electricity, fuel and goods to Gaza.

Hamas said it had planned for a potentially long fight. “We are prepared for all options, including all-out war,” the deputy head of the Hamas political bureau, Saleh al-Arouri, told Al-Jazeera TV. “We are ready to do whatever is necessary for the dignity and freedom of our people.”

U.S. President Joe Biden said from the White House that he had spoken with Netanyahu to say the United States “stands with the people of Israel in the face of these terrorist assaults. Israel has the right to defend itself and its people, full stop.”

Saudi Arabia, which has been in talks with the U.S. about normalizing relations with Israel, called on both sides to exercise restraint. The kingdom said it had repeatedly warned about the danger of “the situation exploding as a result of the continued occupation (and) the Palestinian people being deprived of their legitimate rights.”

Lebanon’s Hezbollah militant group congratulated Hamas, praising the attack as a response to “Israeli crimes.” The group said its command in Lebanon was in contact with Hamas about the operation.

The attack comes at a time of historic division within Israel over Netanyahu’s proposal to overhaul the judiciary. Mass protests over the plan have sent hundreds of thousands of Israeli demonstrators into the streets and prompted hundreds of military reservists to avoid volunteer duty — turmoil that has raised fears over the military’s battlefield readiness.

It also comes at a time of mounting tensions between Israel and the Palestinians, with the peace process effectively dead for years. Over the past year, Israel’s far-right government has ramped up settlement construction in the occupied West Bank, Israeli settler violence has displaced hundreds of Palestinians there and tensions have flared around a flashpoint Jerusalem holy site.

Palestinians demonstrated in towns and cities around the West Bank on Saturday night. Palestinian health officials said Israeli fire killed five there, but gave few details.

Adwan reported from Rafah, Gaza Strip. Associated Press writers Wafaa Shurafa in Gaza City and Isabel DeBre and Julia Frankel in Jerusalem contributed to this report.

The Ripples of Republican Chaos

The New York Times – Opinion

The Ripples of Republican Chaos

By Charles M. Blow – October 4, 2023

A blurry image of an American flag. — Credit…Emil Lippe for The New York Times

This week, Donald Trump delivered his version of a sad tiny desk performance, hunched over the defendant’s table in a New York courtroom, diminished and watching the illusion of power and grandeur he has sold voters thin and run like oil in a hot pan.

He insisted on appearing in person at his civil fraud trial, apparently believing that he would continue to perform his perverse magic of converting that which would have ended other political careers into a political win for himself.

His hubris seemed to consume him, persuading him that in matters of optics, he’s not only invincible but unmatched.

He has done it before: In August he scowled in his mug shot — a precursor to his Fulton County, Ga., criminal trial — summoning the allure of an outlaw, using the photo to raise millions of dollars, according to his campaign.

But I think his attempts at cosplaying some sort of roguish flintiness will wind up being missteps. Courtrooms don’t allow for political-rally stagecraft. There’s no place to plant primed supporters behind him to ensure that every camera angle captures excited admirers. He’s not the center of attention, the impresario of the event; no, he must sit silently in lighting not intended to flatter and in chairs not intended to impress.

Courtrooms humble the people in them. They equalize. They democratize. In the courtroom, Trump is just another defendant — and in it, he looks small. The phantasm of indomitability, the idea of him being wily and slick, surrenders to the flame like tissues in a campfire.

The image was not of a defiant would-be king but of a man stewing and defeated.

The judge in the case even issued a limited gag order after Trump posted a picture of and a comment about the judge’s clerk on Truth Social.

Meanwhile, there’s the historic ouster of the House speaker, Kevin McCarthy, by members of his own party for the unforgivable sin of seeking a bipartisan solution to keep the government open.

In Greek mythology exists the story of the Gigantomachy, a battle between the Olympian gods and giants. According to prophecy, the gods could emerge victorious only if assisted by a mortal. Hercules came to the rescue.

But in Republicans’ version of this drama, McCarthy could have emerged victorious over his party’s anarchists only if Democrats had come to his aid. None did.

He was felled by a revolt led not by a giant but by the smallest of men, not in stature but in principles: the charmless Representative Matt Gaetz of Florida.

Anyone who thought that Democrats were going to save McCarthy should have thought again. Ultimately, he succumbed to the result of his own craven pursuit of power: The rule that Gaetz used to initiate the vote to strip McCarthy of the speaker’s gavel was the rule McCarthy agreed to in order to get his hands on the gavel in the first place.

Republicans are engaged in an intense session of self-flagellation. Does it also hurt the country? Yes. But in one way it might help: America needs to clearly see who the culprits are in today’s political chaos, and the damage they cause, so that voters can correct course.

And the events of this week should give voters pause. The tableau that emerges from the troubles of Trump and McCarthy is one in which the G.O.P.’s leaders are chastened and cowed, one in which their power is stripped and their efforts rebuked.

This is just one week among many leading up to the 2024 elections, but it is weeks like this that leave a mark, because the images that emerge from them are indelible.

All the inflamed consternation about Joe Biden’s age and Hunter Biden’s legal troubles will, in the end, have to be weighed against something far more consequential: Republicans — obsessed with blind obeisance, a lust for vengeance and a contempt for accountability — who no longer have the desire or capacity to actually lead.

Their impulses to disrupt and destroy keep winning out, foreshadowing even more of a national disaster if their power grows as a result.

How Republican primary voters respond to this Republican maelstrom of incompetence is one thing. How general election voters will respond to it is quite another.

“A clarion call to arms”: Experts on why MAGA remains impervious to anti-Trump Republicans’ message

Salon

“A clarion call to arms”: Experts on why MAGA remains impervious to anti-Trump Republicans’ message

Chauncey DeVega – October 4, 2023

Trump Supporters Wally Skalij/Los Angeles Times via Getty Images

Trumpism is a public health crisis.

In his role as cult leader, Donald Trump’s direct threats and incitements of violence, terrorism, and mayhem – which include killing people – have encouraged the MAGA people and other members of the white right to engage in the same behavior. In the most recent high-profile example of right-wing violence and terrorism, last Thursday a Trump MAGA cultist went to a protest in a suburb of Albuquerque against the decision by the local government to reinstall a statue “honoring” a Spanish conquistador, Juan de Oñate. While there, the MAGA cultist attempted to provoke a fight and then pulled out his pistol and shot one of the protesters, who is an environmentalist and member of the Hopi tribe. The MAGA hat-wearing Trumpist reportedly laughed and smirked during his police interview.

On Monday, Trump threatened and raged at the judge presiding over his civil trial in New York for fraud and other financial crimes. Trump also verbally attacked and threatened New York Attorney General Letitia James, calling her a “racist” and “a horror show.” James is a Black woman. While in court, Trump scowled like an adult toddler and looked like he was having murderous thoughts of revenge and suffering. Trump’s performance was generally pompous and detached from reality, as the ex-president lied and claimed that he was being “persecuted” and is a type of victim-martyr for the MAGA cause. On Tuesday, the judge barred him from making personal attacks on court staff after the former president disparaged a law clerk. In all, Trump’s behavior was that of a cult leader and demagogue who is finally facing some type of serious accountability for his criminal behavior.

None of this really matters to Trump’s MAGA cultists and other followers. Trump’s hold over them remains very strong and appears to be largely immune to any outside intervention. Moreover, Trump’s power and control over the MAGA cult endures – despite and even more likely because of his criminal trials and escalating violence and other destructive and dangerous behavior.

To that point, last week New York Times political reporter Jonathan Swan highlighted an attempt by a group of anti-Trump conservatives to stop the ex-president by weakening his support among the MAGA cultists.Their efforts failed; Trump’s dark charism and cult-leader power is that great.

A well-funded group of anti-Trump conservatives has sent its donors a remarkably candid memo that reveals how resilient former President Donald J. Trump has been against millions of dollars of negative ads the group deployed against him in two early-voting states.
The political action committee, called Win It Back, has close ties to the influential fiscally conservative group Club for Growth. It has already spent more than $4 million trying to lower Mr. Trump’s support among Republican voters in Iowa and nearly $2 million more trying to damage him in South Carolina.
But in the memo — dated Thursday and obtained by The New York Times — the head of Win It Back PAC, David McIntosh, acknowledges to donors that after extensive testing of more than 40 anti-Trump television ads, “all attempts to undermine his conservative credentials on specific issues were ineffective.”
The memo will provide little reassurance to the rest of the field of Mr. Trump’s Republican rivals that there is any elusive message out there that can work to deflate his support.
“Even when you show video to Republican primary voters — with complete context — of President Trump saying something otherwise objectionable to primary voters, they find a way to rationalize and dismiss it,” Mr. McIntosh states in the “key learnings” section of the memo.

The article continues:

For the polling underpinning its analysis, Win It Back used WPA Intelligence — a firm that also works for the super PAC supporting Mr. Trump’s chief rival in the race for the presidential nomination, Gov. Ron DeSantis of Florida.
Examples of “failed” ads cited in the memo included attacks on Mr. Trump’s “handling of the pandemic, promotion of vaccines, praise of Dr. Fauci, insane government spending, failure to build the wall, recent attacks on pro-life legislation, refusal to fight woke issues, openness to gun control, and many others.” (Dr. Anthony S. Fauci led the national response to the Covid pandemic.)
The list of failed attacks is notable because it includes many of the arguments that Mr. DeSantis has tried against Mr. Trump. The former president leads Mr. DeSantis by more than 40 points in national polls and by around 30 points in Iowa, where Mr. DeSantis’s team believes he has the best shot of defeating Mr. Trump.
Mr. McIntosh, a former Indiana congressman who co-founded the Club for Growth and the Federalist Society, makes it clear in the memo that any anti-Trump messages need to be delivered with kid gloves. That might explain why Mr. DeSantis’s super PAC, Never Back Down, has treated Mr. Trump gingerly, even in ads meant to contrast his character and his record unfavorably against Mr. DeSantis’s accomplishments.

Swan’s reporting reinforces how Trumpism and American neofascism constitute a political, cultural, and moral crisis for the country and world. It is true that tens of millions of Americans correctly view Trump with contempt and understand that is an extreme threat to the country’s democracy and society. Unfortunately, tens of millions of other Americans view that same foul and evil behavior by Donald Trump as something admirable, evidence that he is “strong” and a “fighter” who is willing to break the law and undermine democracy to get things done for people like them. And perhaps even more troubling for what it reveals about the health of American society, there are tens of millions of other Americans who are indifferent to Trump’s evil and wrongdoing and the existential danger that he and the Republican fascists and MAGA movement represent to the country.

In an attempt to make better sense of the enduring power of the Trump MAGA cult, I asked a range of experts for their insights and reactions to this important new reporting by the New York Times.

Dr. Lance Dodes is a retired assistant clinical professor of psychiatry at Harvard Medical School and a training and supervising analyst emeritus at the Boston Psychoanalytic Society and Institute.

The recent finding that Trump supporters will rationalize and ignore even sophisticated ads produced by Republicans against Trump — ads showing him saying things that are opposed to the very values of the Republican audience — is strong evidence of the cult-like nature of at least the most committed of his followers. Cults have exactly this characteristic: unquestioning worship of a charismatic leader and inability to hear or consider opposing or even differing views, especially about the leader who must remain godlike. Trump’s personal primitive psychology, in which he believes himself to be godlike and has contempt for others as valuable human beings, makes him a perfect candidate to surround himself with a cult. In turn, members vulnerable to joining the cult seek just such a godlike figure in a regressive wish to be protected, cared for, and told how to think. The irony of course is that the leader, Trump in this case, cares only about his grandiosity and nothing at all about them or their welfare.

It’s been impossible to draw these regressed followers away from the cult not only because of their wishful belief in their charismatic god, but also because leaving the cult would mean the loss of support and identity from the other cult members who, like Trump himself, would condemn them as evil.

To enable cult members to leave they would have to have a significantly large enough number of others to create a new inclusive, protective group to which they could attach themselves. That might happen if a new charismatic leader arose to lead them away in large enough numbers to feel safe rebelling from the old leader. It would help for there to be a major event that a new leader within or outside the group could seize upon to redirect the members, like the honest child in the fable who finally spoke up to say the emperor had no clothes. There probably are figures within the Republican Party who could serve in that role, but it would require more moral and political courage than we have seen so far.

Jen Senko is the director of the documentary “The Brainwashing of My Dad.”

Yes, Trump COULD stand in the middle of Fifth Avenue and shoot someone, and they would still be devoted. Dare I say he could even claim he’s a woke lib and his followers wouldn’t even hear it. It no longer matters what he says.

We all know by now; this is classic cult behavior. It’s all about the leader, not the ideology or what the person they follow represents—they might represent nothing. Cult followers abdicate their reasoning, and their own ideas of what is good or bad to a leader. Giving themselves over to a leader absolves them of any guilt or responsibility. If confused by all the stuff flooding the zone and the contradictions in the news, it’s almost a relief to just hand it over to a leader who says He Knows.

Marcel Danesi is Professor Emeritus of linguistic anthropology and semiotics at the University of Toronto. His new book is Politics, Lies and Conspiracy Theories: A Cognitive Linguistic Perspective.

Oppositional messaging in the case of a “culture war leader” will never work, because it is seen as the words of enemies against Trump and his followers. Trump’s lies are thus not interpreted as destructive words but as part of a clarion call to arms to overturn the deep state that must be defeated to restore America to its purported roots, which, incidentally, Trump has never specified what he means by them, in true Orwellian fashion. Any message against him is thus filtered out as an attack from opposing warring armies in the ongoing cultural war, and thus discarded as tactics. Trump’s lies are perceived to be verbal weapons in that war. There is nothing Trump could say or do that would erode support from his followers, because he is seen as the leader of the greater cause of taking down the enemies that he and his blind followers see as the source of America’s and their own troubles, and as eroding the fabric of American society. Outside of Trump’s influence, the same people can be compassionate, empathic, generous, but in their Trump-aligned echo chamber they become antisocial toward outsiders. It is somewhat ironic to observe that Trump and his followers portray their battle as a counterculture one, as did the hippies in the 1960s and 1970s, portraying the government as the “establishment” and the liberal democratic state—again quite ironically—as the enemy of freedom and true American values.

Dr. Justin Frank is a former clinical professor of psychiatry at the George Washington University Medical Center and the author of “Trump on the Couch: Inside the Mind of the President.”

I have always believed that an important part of psychic development is the ability to face, feel, and think about loss. Trump never had that capacity, nor was allowed to have it, growing up. He immediately transformed loss into blaming others, into triumphant denial (refusing to accept that he lost), or into acts of revenge. All three characteristics dominated the January 6 insurrection.

What I learned in my psychiatric residency – as well as in my own life – is that sorrow is the vitamin of growth. Does that make denial the vitamin of autocracy? During the 2016 election Trump said that if he lost, the entire campaign would have been a waste of time and energy. Denying and dismissing loss led us to January 6. Just remember Abe Lincoln’s statement after he lost an election: “I feel like a 16-year-old who stubbed his toe: I’m too old to cry but it hurts too much to laugh” Facing the painful process of renunciation leads also to emotional growth and maturity. So, how does the GOP win back MAGA followers? It seems impossible, even if Trump goes to prison and is completely discredited.

To me, the operative word is not “win,” but wean. Trump supporters are attached to him at the mouth, at the lips, at the heart and soul. He is their divine leader, much the way an evangelical preacher becomes more important to his congregation – as the personification of God’s power – than the scriptures they recite. Trump has a similar deep effect on his flock. The only way they could be brought back to the GOP hymnal is to gently, persistently, non-judgmentally help them discover for themselves Trump’s genuine contempt for them, our country and its health and wellbeing.

Rich Logis is a former right-wing pundit and high-ranking Trump supporter. He describes himself as “a remorseful ex-Trump, DeSantis and GOP voter”. Logis is the founder of Perfect Our Union, an organization that is dedicated to healing political traumatization; building diverse, pro-democracy alliances; and perfecting our Union.

I understand the fatigue from coverage of Trump; constant MAGA/Trump trauma is exhausting and soul-draining. But it remains necessary, because our nation must be continually reminded that there is nothing Trump could do, or say, to lose the support of most voters who identify as MAGA or Ultra-MAGA. And, as a one-time, zealously devout MAGA voter, I mean “nothing” literally, not figuratively. The country club conservatives, über-wealthy GOP donors and Ronald Reagan mythologizers haven’t accepted that they no longer run the party, as evidenced by myriad Republican focus groups — whose attendees affirm their commitment to voting Trump—and the millions spent in ads intended to weaken Trump — but have the opposite intended effect.

$1 trillion in anti-Trump would help—not hurt—Trump. Electorally defeating MAGA is non-negotiable; our democratic republic, almost certainly, would not survive a second Trump presidency (which I also fear could be a permanent presidency). It’s important to be candid with the American people: electorally winning, however, is the start—not the finish—of de-traumatizing our nation from MAGA.

Joe Walsh was a Republican congressman and a leading Tea Party conservative. He is now a prominent conservative voice against Donald Trump and the host of the podcast “White Flag with Joe Walsh.”

It is a cult. How many times must that be said. One of America’s two major political parties has become completely radicalized and has given up on democracy. Trump is their cult leader. Each and every evidence of his corruption and criminality only strengthens his support within his cult. Our only job now is to defeat them.

Treasury’s Yellen says US overdependent on China for critical supply chains

Reuters

Treasury’s Yellen says US overdependent on China for critical supply chains

Reuters – October 3, 2023

WASHINGTON (Reuters) – U.S. Treasury Secretary Janet Yellen said on Tuesday the United States has become overly dependent on China for critical supply chains, particularly in clean energy products and needs to broaden out sources of supply.

Yellen, speaking at a Fortune CEO event in Washington, repeated her longstanding view that the United States does not want to decouple economically from China.

She said that she has not been “a strong believer” in industrial policy, but that the United States had stood by for too long while other countries built up semiconductor industries with massive subsidies.

The U.S. would face national security concerns without a robust semiconductor sector of its own, she said, adding that last year’s Chips and Science Act will help reverse that trend.

“We’re fooling ourselves if we think that abandoning, for all practical purposes, semiconductor manufacturing, is a smart strategy for the United States,” Yellen said.

(Reporting by David Lawder and Kanishka Singh in Washington; editing by Jonathan Oatis and Deepa Babington)

Russian rouble briefly returns to ‘laughing stock’ level that prompted emergency interest rate hikes last time

Fortune

Russian rouble briefly returns to ‘laughing stock’ level that prompted emergency interest rate hikes last time

Prarthana Prakash – October 3, 2023

The Russian rouble hit the skids after Russia’s invasion of Ukraine last February. Initially, the government took a hands-off approach to deal with the rollercoaster ride of exchange rates. Instead, they boasted about the nation’s economic resilience in the face of sanctions and shrinking exports. But come August, they had to step in as the rouble nosedived to a 16-month low, worth less than a penny.

A déjà vu moment played out on a recent Tuesday, with the rouble teetering just below the 100-mark against the U.S. dollar—a critical benchmark for Russia’s currency. Although the rouble managed a modest comeback, this embarrassing stumble highlighted its shaky footing and raised concerns of further depreciation.

The rouble’s value has taken a beating this year, shedding almost 30% of its worth against the greenback since January.

A number of things may have influenced the drop in exchange rates—from foreign currency outflows and declining trade activity to Russia’s waning current account surplus.

But some factors may still be working to Russia’s advantage, such as its budget.

The falling value of the rouble means more of the Russian currency for every dollar earned through the trade of oil or other products. This, in turn, has given the Kremlin more money to pour into the military or social schemes, for instance, to help offset the impact of sanctions.

Despite the seeming upside of a weak ruble and the Kremlin’s swift actions to stem any negative effects from it, the Russian currency’s value is not out of the woods yet.

The August slump

When the rouble weakened to more than 100 to the U.S. dollar in August, the Bank of Russia called an “extraordinary meeting”, subsequently hiking interest rates by 350 basis points to 12%. The bank also said it would halt foreign currency purchases on the domestic market until the end of the year in an effort to stabilize its financial markets.

Russia’s state media and senior officials were also rattled by the rouble’s tumble into three-digit territory. Vladimir Solovyov, a popular TV person in Russia and President Vladimir Putin’s ally, said the country had become a laughing stock, pointing to how dire the situation had gotten.

Putin’s economic advisor, Maxim Oreshkin, told state-owned news outlet TASS that “loose monetary policy” was causing the drop in the rouble’s exchange rate and exacerbating inflation.

“A weak ruble complicates the structural restructuring of the economy and negatively affects the real incomes of the population. A strong ruble is in the interests of the Russian economy,” Oreshkin said according to the translation of an August op-ed in TASS.

In September, the central bank once against raised rates to 13% to tackle the falling rouble value and stubborn inflation, which was at 5.33% at the time. Further rate hikes are expected in the next central bank meeting later this month.

The rouble has wavered a lot since 2022—shortly after Russia’s invasion of Ukraine it hit an all-time low of 120 roubles to the U.S. dollar, but by last June, the currency had recovered to nearly 50 roubles to the dollar when oil and gas prices soared.

“This level (100) is not a technical resistance, it’s an important psychological barrier,” said Russian investment group Alor Broker’s Alexei Antonov told Reuters. “For now, everything speaks in favour of the rouble continuing to get cheaper.”

The rouble’s current weakness could be temporary, but the Russian government faces pressures on its finances and more prolonged effects of a weaker currency. Plunging export volumes continue to weigh on the economy, as the current account surplus shrank 86% year-on-year to just $25.6 billion in January-August. Elevated consumer prices along with a depreciated rouble make it harder for the average Russian to afford basic goods.

As Moscow struggles to keep its currency strong while navigating other macroeconomic challenges, experts suggest that a drop in the rouble’s exchange rate is not quite an economic crisis, although it does ring alarm bells for the government.

“This is the closest we came to a real economic problem since the start of the war,” Janis Kluge, an expert in the Russian economy at the German Institute for International and Security Affairs told the Associated Press in August following the rouble’s drop to a 16-month low. “In Russia, the exchange rate is always seen as the most important indicator of the health of the economy.”