Russia is hedging

A Bloomberg report reveals a memo leaked from the Kremlin. Russia is willing to rejoin the dollar system and cooperate with the US on energy, minerals, and technology — granting American corporations access to the Russian consumer market.

After its assets were frozen and SWIFT access cut, Moscow relied on China for trade — but with limited hedging options and little geopolitical room. Russia knows China can exploit this disadvantage, and Beijing has every incentive to keep the yuan weak for exports. China has even stopped importing Russian electricity altogether.

Russia's wishes are clear: friendship with China, but at arm's length. For America, a deal with Russia hedges against mineral weaponization and gives Washington leverage over Europe once the Ukraine war ends. But when Russia and America shake hands, Europe risks alienation — forced to expand military spending alone.