In Geopolitics This Week
The Emerging Indo-Pacific Order, Russian Forces Make Gains in the Donbas, LNG Negotiations Between Germany and Qatar Continue
The Emerging Indo-Pacific Order
The countries of the Quadrilateral Security Dialogue (Quad) — Australia, India, Japan and the United States — have agreed to create a joint maritime surveillance system. The initiative is primarily justified as a means for all participant countries to combat illegal fishing in the Indo-Pacific, and follows complaints from Japan and other countries in the region about incursions by Chinese fishing vessels into their waters.
The new initiative, called the Indo-Pacific Maritime Domain Awareness Association, promises its members a “near real-time picture” of maritime activities across two vast oceans. This will work to expand the QUAD members' maritime surveillance capabilities in the waters of the Pacific Ocean, Southeast Asia and the Indian Ocean. In addition to the surveillance pact, QUAD leaders committed to increased cooperation on infrastructure as a means to drive “productivity and prosperity” in the Indo-Pacific region.
Japan currently holds the rotating presidency of the Quad, and has used this platform to denounce alleged incursions by Chinese vessels in the waters surrounding the Japanese archipelago and the Senkaku Islands. The Japanese Prime Minister, Fumio Kishida, has made clear that his government worries about China’s growing “military activities.”In response, Kishida has called for greater military capabilities to be acquired and transferred to the Japanese armed forces. The Japanese government is now reportedly preparing to pledge a drastic increase in the country's defence spending, with a particular focus on strengthening stand-off weapons, and outer space and cyberspace capabilities.
Parallel to bolstering their military footprint across the Info-Pacific, both Japan and the US are actively working to establish a regional coalition focused around isolating China. To achieve such an outcome, the US is working to establish the Indo-Pacific Economic Framework, an economic investment bloc which promises to include Japan, Australia, Brunei, India, Indonesia, Malaysia, New Zealand, the Philippines, Singapore, South Korea, Thailand and Vietnam.
Joint maritime missions and increased intelligence sharing between countries in the region serve as a means to constrain China's freedom of action in the Indian and Pacific Oceans. Moreover, a US-led infrastructure investment framework that excludes China from development opportunities in Asia will limit Beijing’s economic relationships with the region.
As such, two geostrategic challenges are emerging for China. One is military, and comes in the form of deeper operational integration between the armed forces of Japan, India, Australia, the United States, and other countries in China’s periphery. The other is economic, as growing political unity between the United States and its allies, the European Union and members of the Quad could jointly threaten China's export-driven economic strategy before the country is able to rely on domestic consumption to sustain state revenues.
Russian Forces Make Gains in the Donbas
In what may prove to be a decisive moment in the battle over the Donbas, Russian forces are pressing their attack against one of the last remaining Ukrainian outposts in the Luhansk region. Russian forces are advancing on the Severodonetsk-Lysychansk salient from three directions in an attempt to encircle a large pocket of Ukrainian troops. It is here that Ukrainian forces are particularly at risk of being enveloped by the Russian assault, potentially setting the stage for a cauldron battle that could seriously degrade Ukraine's ability to contest the Donbas. However, it remains unclear whether the critical logistical route between Severodonetsk and Bakhmut has been cut off as intense fighting continues.
Russian forces have begun conducting direct assaults on Severodonetsk while continuing to attempt an encirclement of the city. Some reports indicate that Chechen units fighting on behalf of Russia have already seized a hotel in the northern part of the city. Russian forces have also conducted offensive operations southeast of Rubizhne, with units positioned here expected to link up with the forces already assaulting Severodonetsk in the coming days. It remains unclear if Russian forces have managed to cut off all routes and surrounded Severodonetsk so far, but doing so would trap a number of Ukrainian units in the Severodonetsk cauldron.
Russian forces are unlikely to advance rapidly in direct assaults against Severodonetsk, but supporting operations will likely continue to secure incremental gains around the city. To complete this encirclement, Russian forces are expected to advance toward Slovyansk from Lyman to the north. So far, Russian forces have been unable to advance south from Izyum due to stiff Ukrainian resistance along the road. At the same time, Russian forces are reportedly reinforcing their positions north of Kharkiv City in order to halt the ongoing Ukrainian counteroffensive near the Russian border. Here and elsewhere across Ukraine, Russian forces are likely preparing for numerous imminent Ukrainian counteroffensives by settling in for protracted operations.
Since the war began, Russia's “special military operation” has thus far had limited objectives: to force a change of regime in Kiev, ensure permanent control over Russian majority areas in eastern Ukraine, and secure an “asymmetrical peace” that favours Russia in the long run. Yet Russian strategy has already been undermined by mistaken assumptions about Russian military capabilities, Ukrainian willingness for resistance, and NATO's determination to weaken Russia by supplying Ukraine with weapons and intelligence. The war now looks likely to turn into a grinding and costly stalemate that won’t end until all involved parties accept a less-than-ideal outcome.
LNG Negotiations Between Germany and Qatar Continue
Last week, Germany and Qatar signed a deal to deepen their energy partnership in the supply and processing of liquified natural gas (LNG). The Energy Partnership between Qatar and Germany purports to support high-level intergovernmental dialogue between the two countries on energy-related topics, and promises to build bridges between stakeholders in the public and private sectors from both countries. The deal will see two sides progress on a roadmap outlining the structure and actions of future energy transfers.
Germany is in desperate need of non-Russian natural gas supplies. An estimated 56 percent of Germany's natural gas consumption comes from Russia, an amount that would require monumental effort to replace via another supplier. Facing the prospect that Moscow might cut off gas supplies to Germany in retaliation for Berlin’s diplomatic, economic and military support to Ukraine, Berlin is busy securing energy. The German government is increasingly under pressure due to rising energy costs, and this deal with Qatar amounts to a short-term fix while alternative sources of energy are found.
While LNG is Qatar's main export, and the country produces around 107 billion cubic metres (cbm) of gas annually, roughly 80 percent of this natural gas is tied up in long-term contracts. As such, only an estimated 10-15 percent can be diverted to Europe through negotiations with the Qatari leadership. Nevertheless, Qatar has been eager to expand its LNG production capacity in recent years, and is expanding a number of LNG facilities with the aim of significantly increasing production by 2026. Until then, new contracts will have to be negotiated between Doha and Berlin, and the German-Qatari Energy Partnership is a part of this process.
These talks are not without their challenges. Some reports indicate that Berlin remains reluctant to commit to Qatar's demands for 20-year contracts for the LNG volumes necessary for Germany to reduce its dependence on Russian gas. In the years ahead, Doha has pledged to deliver LNG to Germany sourced from the Golden Pass gas liquification plant currently being developed on Texas' Gulf Coast. Until then, Germany and other European countries are becoming increasingly desperate, and choosing to pay a premium for spot gas — large deliveries of gas purchased in one-off transactions. In effect, many EU member states are now buying US LNG at steep prices, with the US offering the most spot gas in the market.