Press review: Power struggle erupts in Armenia and Maduro hits back at EU over sanctions / News / News agency Inforos
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Press review: Power struggle erupts in Armenia and Maduro hits back at EU over sanctions

Press review: Power struggle erupts in Armenia and Maduro hits back at EU over sanctions

Top stories in the Russian press on Friday, February 26, prepared by TASS

Media: Power struggle erupts in Armenia

After a short break, political tensions in Armenia have escalated once again. On February 25, the republic’s general staff called for the resignation of Armenian Prime Minister Nikol Pashinyan. The Armenian Defense Ministry did not support its colleagues, stating that the army should not meddle in politics. However, the general staff found support among the majority of opposition politicians and a significant part of the general public, Izvestia reports. A member the Prosperous Armenia opposition faction told Izvestia that Pashinyan’s resignation had become "a national demand." The premier himself branded the general staff’s statement to be a military coup attempt, dismissed its head Onik Gasparyan and called on his supporters to take to the streets. However, those opposing the Armenian PM did the same.

"Pashinyan is virtually gone in people’s minds, almost all segments of the population are against him, but he is stubborn, he is leading the country to civil strife," Arman Abovyan, secretary of the opposition faction "Prosperous Armenia" told the newspaper. "His resignation is not just part of the political agenda, it’s a national demand. The man who practically made the entire country kneel before Turkey and Azerbaijan has no political or moral right to lead it. The longer he is in power, the higher the possibility of domestic destabilization will be, and it is rising literally with every hour."

Meanwhile, Sergey Markedonov, Leading Researcher at MGIMO’s Center for Euro-Atlantic Security, told Kommersant that the attempt at a military coup, which was followed by Pashinyan urging his supporters to take to the streets, had shown that the Armenian opposition does not have any hidden moves to ensure the PM’s quick resignation. "Pashinyan, who has lost the majority of his supporters after the 2018 revolution, still has a group of followers among the public, and it is not that small. Moreover, according to recent polls, he remains the most popular politician compared to other, even more unpopular figures."

For his part, Director of the Caucasus Institute in Yerevan Alexander Iskandaryan told Kommersant that when it comes to Moscow, Pashinyan can hardly be liked much by the Kremlin, however, Russia is unlikely to take any action. "Moscow has learned from its experience with Ukraine and Abkhazia, and it won’t meddle in Armenia’s domestic affairs," he said.

Nezavisimaya Gazeta: Venezuela expels EU ambassador

A new crisis has broken out in the relations between Venezuela and the EU. President Nicolas Maduro announced that Venezuela would be cutting ties with the European Union, with EU Ambassador to Venezuela Isabel Brilhante Pedrosa ordered to leave the country as a tit-for-tat measure following a new wave of Western sanctions against Venezuela. Pedrosa’s expulsion corresponds to the decision of US President Joe Biden to prolong the policy of searching all vessels en route to Cuba. This decision first and foremost deals a blow to the Venezuelan economy. Experts quizzed by Nezavisimaya Gazeta suggest that the new restrictions are likely to improve Maduro’s domestic standing than to undermine his position.

The outbreak of tensions with the EU clearly shows that although Venezuelan officials were looking for ways to become closer to Europe, the relations between Brussels and Caracas are unlikely to thaw anytime soon, the newspaper notes. This becomes clear in the light of Biden’s recent decision that allows the US Coast Guard to search all vessels bound for Cuba. Havana is one of the few allies of Maduro and the only international venue for selling Venezuelan oil bypassing US sanctions. That is, Washington has shown that it has no plans to ease the sanctions pressure on Venezuela, and the Europeans are unlikely to meet Maduro halfway if the US refuses to do the same.

Director of the St. Petersburg State University Ibero-American Studies Center Viktor Jeifets told Nezavisimaya Gazeta that under Biden, it is unlikely that ties between the US and Venezuela will deteriorate significantly. However, the White House will not take the first step when it comes to Maduro. "Although Biden supports softer means of pressuring Caracas, he still needs to lay out a tough stance to avoid angering many Republicans. In this case, it is unlikely that there will be a thaw in US-Cuban relations like the one that happened under President Barack Obama," the expert said.

"It is possible that Maduro has decided to show "who’s boss" and that no one can order him around. If this is true, he is taking a risk. On the whole, the EU is more open to negotiations than the US. However, if Maduro continues to test the EU’s patience endlessly, he will inevitably face a tough response," Jeifets predicted.

Nezavisimaya Gazeta: Russia expands share of China’s yuan in its strategic reserves

The Russian Ministry of Finance has changed the foreign currency structure of the Russian National Wealth Fund, decreasing the share of the dollar and the euro by about 20% and moving a fifth of its reserves to Asian currencies, with a special emphasis on the Chinese yuan. Experts quizzed by Nezavisimaya Gazeta note that this decision is necessary and well-timed, but, it is too early to talk about an active de-dollarization of the Russian economy, as it still depends on the inflow of petrodollars. For the general population, foreign currency remains the most reliable way to shield their savings from long-term devaluation, experts say, adding that the most important thing is to diversify the risks.

The Russian Finance Ministry has included the Japanese yen in the currency structure of the National Wealth Fund at a share of 5%, and the Chinese yuan with a share of 15%. At the same time, the proportion of the greenback and the euro has dropped from 45% to 35%, respectively. The share of British pounds remains at 10%.

"The Finance Ministry was planning to do that before the pandemic, however, in 2020, it was hard to find a moment when the currency pairs were more or less stable," Freedom Finance analyst Valery Yemelyanov told Nezavisimaya Gazeta. According to the expert, the market is calmer now: "There is a possibility to sell some of the assets at a comfortable price, especially the euro, which is currently at the highest position against the dollar in several years, and to expand diversification through purchasing alternative currencies."

"Right now, there is a threat of the dollar weakening due to record injections of liquidity by the Federal Reserve System. The dollar will drop against the euro and other currencies, so decreasing its share in the reserves is rather logical," head of the analytical department at AMarkets Artem Deev told the paper. "The increase in the share of Asian currencies reflects the recovery of Asia-Pacific economies, especially China. Trade with these economies will expand."

However, experts note that it is too early to talk about any active de-dollarization. "Oil, gas and petroleum products still form the basis of Russia’s GDP, and they are denominated in dollars on the stock exchange. Russia can develop trade with other countries, however, it will not escape payments in the US currency," Deev explained.

Izvestia: Experts suggest oil prices may rise to $85 per barrel in 2021

Under the most optimistic scenario, oil prices in 2021 may reach $85 per barrel, experts interviewed by Izvestia suggest. This upsurge will be possible once global demand recovers and the fight against the COVID-19 pandemic achieves success, analysts note. Oil prices are going up due to decreased production in the United States, due adherence to the OPEC+ deal and the lack of development in the negotiations between the US and Iran. However, experts warn that these factors may be temporary and over the coming months, the prices are likely to be downwardly corrected.

Prices for the black gold are still on the rise. On February 25, they went up to around $66, and since the start of the year, they have increased by 30%. This steady growth of oil prices began in November 2020, when the black gold cost less than $37 per barrel, Alpari Senior Research Analyst Vadim Iosub noted. According to the expert, this steady growth is tied to the launch of the mass vaccination drive, which offers some hope when it comes to beating the COVID-19 pandemic in 2021. This will mean the growth of the global economy and an increased demand for oil, the analyst said.

"In our opinion, under an optimistic scenario, Brent oil prices in 2021 may reach about $85 per barrel. This would be the highest point since September 2018," the expert told the paper.

Oil can go up to $80 per barrel or even higher if global demand recovers, head of the analytical department at AMarkets Artem Deev said. However, such a scenario is unlikely, since the pandemic will continue to influence global markets this year, and the recovery won’t be swift, the expert added.

"Short-term growth to that point is possible, if the US does not recover production quickly and OPEC+ maintains the existing quotas," he noted.

For his part, Oleg Bogdanov, a leading analyst at QBF, pointed out that it would be difficult for oil prices to stay at the current level, and they are more likely to decrease than rise in the near future. The analyst said that if oil prices reach $70 per barrel, it won’t be for long. As of now, a drop in prices to $50-55 is more likely, the analyst concluded.

Vedomosti: Officials fear British strain of coronavirus may reach Moscow in April

The Moscow government fears that the British strain of coronavirus may begin to spread to the Russian capital in April, which may undermine the epidemiological situation, sources close to the Moscow government and the Kremlin told Vedomosti.

"Right now, the current wave of the coronavirus spread is on the decline, and doctors have been given vacations but they have been told that they must return to work in April. There are fears that the British strain of coronavirus, which is considered more infectious, will reach Moscow, and the situation will deteriorate once again," a source in the Moscow government said.

The source noted that so far, Moscow has lagged behind Europe when it comes to COVID-19 spread by about a month or two, and this is why this is taken into consideration. "So, we do not shut down any temporary hospitals," the official noted. A source close to the Kremlin reaffirmed that the Moscow government expects the COVID-19 situation to deteriorate by mid-spring.

The so-called British strain of the coronavirus was discovered in December 2020 in the UK and began to spread fast by mid-December. This strain is considered more infectious and is thought to cause more serious symptoms. The UK introduced a strict lockdown after the strain was discovered.

Russian experts told Vedomosti that the existing vaccines are likely to protect the population against the British strain. "It is likely that the vaccine can protect against the British and the South African strains. Preliminary data suggests that new strains spread faster and cause more deaths. This is yet to be researched," Anton Barchuk, an epidemiologist with the European University of St. Petersburg, told the paper.

Barchuk added that the British strain may begin to spread in Russia in the spring, however, this will not have a significant effect on the epidemiological situation: "Vaccines and antibodies protect against this strain, a high number of people have had the virus, and if the new strains have higher lethality, it’s not by much."

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