Cognitive Dissonance.

You know, I stress it constantly, I am not an oil industry specialist but I can compare--you know, like I can tell the difference between black and white colors, I can also tell, most of the time, BS from truth. I am (semi)professionally involved in debunking Western media BS and here I go again. You already saw a Force 5 tornado of BS from US media on how Trump "brokered" the new deal and how Russia was "defeated". Here is an example from, who else, Bloomberg:

The ill-fated decision to face off against Saudi Arabia in early March was “a strategic mistake and now we’re paying the price, a much higher price than we could have paid,” said Andrey Kortunov, director of the Kremlin-founded Russian International Affairs Council. “This looks like a victory for the U.S., and Russia ends up a bigger loser than Saudi Arabia.”

Just one example of many. Who IS Mr. Kortunov and what RIAC is will talk about this later. Bloomberg also goes for the titles like this: 

Trump’s Oil Deal: The Inside Story of How a Price War Ended

And, in general, one is left to wonder what universe those people live in. I constantly repeat and I will reiterate that in modern world a profession of journalist or news handler is not a viable profession because it is based largely on a lack of any skills or well-trained analytical apparatus and is used primarily for propaganda purpose. The level of American journalism is well known and it is an Exhibit A of a serious case in cognitive dissonance, because in related news, very fresh, like an hour ago, one is forced to compare alternative and real universes.  

North America’s Oil Industry Is Shutting Off the Spigot. Energy producers are resorting to the desperate measure of shutting in productive oil wells.

It is understandable that in my case I could be accused of being biased, because I am Russian, and whatever else could be derived from this fact, but it is really difficult to accuse documented numbers of oil prices and radically anti-Russian outlet such as The Wall Street Journal in any desire to, for whatever reason, unnecessarily confirm a simple fact that US shale oil industry now has a noose around its neck. This is not to mention the fact that US shale oil is but one of few other objectives Russia pursues in her big game with the US and she has necessary cushion to play this game for a long time--time which neither US, let alone KSA, have. And here we come to Western media MO with opinions "from Russia". Let's take a look who US media draws its "opinions" from? Just one example out of many. 

For starters, let's get to RIAC. The first giveaway here is the year of its founding--2011. During Medvedev's Presidency and one after another failures of Russia's diplomacy starting from giving up Libya to being unable to stop the gang rape of Syria, yet still "integrating" with the West. In the end, enough to take a look at such people as Aven being on RIAC's board. So, in general, RIAC is a copy of a good ol' Western "think-tanks" whose real practical value approaches zero and which are involved deeply in doctrine mongering and are nothing but clubs of interests for people who think that they are good at something. RIAC is radically pro-western think-tank. Kortunov's biography is available at RIAC's site and reads exactly as a biography of any other American counterpart in US "think-tanks"--humanities degree (granted obtained at MGIMO), then white board "academic" career in fully discredited Institute of US and Canada, a teaching "tour" in the US, some "research" and writing of papers which lose any value even before they are published anywhere. It is obvious that Kortunov's "portrait" is that of a Russian "liberda" which is directly used by Western media and NGOs to distill opinions on matters of Russia's foreign and domestic policy  and present them as viable. Opinion "generators" for US media of this type which come to mind, of course, are Moscow Higher School of Economics (VShE), another zoo of confused globalists, rags such as Moscow Times, military "specialists" such as Pavel Falgnehauer, or creatures such as Masha Gessen among many others. So, you see how it works? 

As per reality, even Bloomberg had to publish later "attitude adjustment" piece:

“The scale of production cuts is a move in the right direction, but considering how badly demand is affected, it was never going to be significant enough to push the market closer to balance,” said Edward Bell, senior director for market economics at Emirates NBD PJSC in Dubai. “Is Russia going to cut production by 2.5 million barrels a day in two weeks? That’s a pretty steep ask.”

Remember this simple fact, everyone knows, that Russia is fine with the price of oil $30 per barrel, and she is happy as clam with $40 per barrel--prices which do not work for either Saudis or US. So what is the real target here? Obvious, having the US joining the emerging cartel and, in the end, Petrodollar. But as famous Mikhail Bulgakov's character of Professor Preobrazhensky from the Heart of a Dog used to say to his assistant, Dr. Bormenthal: "Don't read Soviet newspapers before lunch." You know what word to change in Preobrazhensky's advice in order to avoid a severe cognitive dissonance. 

As Was Expected.

Recall, from the get go, people who deal not just in oil or economy, but practical geopolitics too, predicted and stressed that Russia will cut production ONLY when the United States joins in. Call it whatever you want, OPEC ++, Cartel, Toys R US, but it is happening. Let's recall what was pointed out by many (me included):

The condition to Trump was articulated, in fact, spelled in the most clear and easily understood way: Russia is going to negotiate ONLY on the condition of the United States joining those negotiations and showing readiness to cut own production.It is either that or the United States cuts production in the most uncontrolled manner down the road due to obvious economic depression unfolding in a front of our very own eyes. 

So, the United States made a correct choice and joined in. 

OPEC+ will cut 9.7 million barrels a day -- just below the initial proposal of 10 million. The U.S., Brazil and Canada will contribute another 3.7 million barrels as their production declines. OPEC officials were still waiting to hear more from Group of 20 members -- though it’s not clear if those numbers will represent real cuts or just production idled because of market forces. 

Didn't we tell you so? I understand that the second wave of reasonable enough questions on how can one trust the United States in this matter is coming. The answer to that is damn simple--the United States is profoundly invested in this cut because it is about the United States' oil industry survival as such. It is akin to a victim of an earthquake having one of its legs completely smashed by a fallen massive concrete block and facing two options: either die in place with his leg under this block or have the leg amputated in place (yes, this was performed in reality and not for once), because it would have been amputated anyway, and have a good fat shot at continuing living. Yes, as a disabled person, but still--alive with most of functions still intact. That is a good analogy. This is exactly how it all happened. 

There are still speculations on what will be the actual American contribution to global cuts, but it is clear it will be at least 2 million bpd and possibly as high as 3 (in Russian). It is a historic deal and it is a first step to global oil cartel--the exact strategic objective of Russia who simply got tired from propping up American oil and gas producers by playing along with OPEC. Now let the speculations and rumor mill, together with face saving spins, start but it is clear that MBS and Saudis had their ass handed to them, as was expected, plus they ended up having to shoulder all blame for starting the war against US shale oil. The big guns, meanwhile, have a lot to discuss apart from OPEC++, oil and other energy issues. But that is a separate story and it is related to Noblesse Oblige. In news related to that issue: Putin spoke yesterday, on the eve of Russian Day of Cosmonautics (April 12, 1961 Gagarin launched into space), to the crew of ISS and praised Moscow-Washington cooperation in space. 

It is a coincidence but I also congratulate my Western Christian denominations friends with Easter (Eastern Orthodox one is on April 19) and as they say in Slavic countries: Christos Voskrese (Christ is risen). Good health and good fortune to all of you.

OPEC++.

Could it have been better handled? Sure, for starters Saudis and the United States could have "tuned up" quotas between themselves to spare oil market an unprecedented shock it continues to experience.  In the end, oil market IS a global market. But it is what it is and we all have to look at the reality of it all, because once Russia entered the fray it became not just about the oil price but the change of the rules of global oil production and trade. And I mean real change. This change did happen, as was predicted, because the issue became not HOW Russia will wipe the floor with Saudis, that was clear from the get go, the issue was HOW Russia will convince the United States to "join the party" and try to behave itself. In the end, as I stated not for once, for Russia the United States is a strategic "partner" and another superpower for who different set of rules applies. In other words: Russia can harm the United States, but she is absolutely not interested in burying the United States because understands catastrophic consequences of such a collapse. Per Saudis, Russia doesn't care if this country disintegrates or survives, both scenarios can be handled. But oil, well, is a separate issue. Russia wanted global cartel, OPEC++ which would see the United States joining in which means a radical change of the game, in which the United States has responsibilities, not just interests. Well, guess what!?

The United States is ready to help Mexico reach its production cut quota as part of the tentative OPEC+ deal, Mexico’s President Andres Manuel Lopez Obrador said on Friday, while the global pact to reduce production was in a kind of Mexican standoff early on Friday as Mexico was still balking at the large cuts it is asked to make. Lopez Obrador spoke with U.S. President Donald Trump on Thursday and the United States agreed to cut 250,000 bpd for Mexico to help it reach the 400,000-bpd cut OPEC+ is asking of it, the Mexican president said at a news conference on Friday, noting that he had informed OPEC+ of this development.

That is much better. Not quite there yet, but much, much better. Trump called Putin and Ria gave a dry summary (in Russian) of that conversation which, it seems, was rather pleasant as it should be. Russia was getting what she wanted, getting US at the table. Well, of course, all this is very reminiscent of feast during the plague, but it wasn't Russia who drove the market to this state. Some even call it Russia's Pyrrhic Victory, and they may even have a point, but in the larger scheme of things very many would love today to be in the position of Russia.  

NEW YORK (Reuters) - Major U.S. lenders are preparing to become operators of oil and gas fields across the country for the first time in a generation to avoid losses on loans to energy companies that may go bankrupt, sources aware of the plans told Reuters. JPMorgan Chase & Co, Wells Fargo & Co, Bank of America Corp and Citigroup Inc are each in the process of setting up independent companies to own oil and gas assets, said three people who were not authorized to discuss the matter publicly. The banks are also looking to hire executives with relevant expertise to manage them, the sources said.

It is almost anti-climactic. And as rumor has it, the United States will cut something around 1.8 bpd in addition to taking up part of Mexico's quota. Judging by a surprising lack of new updates on Yahoo Finance something IS afoot there. Obviously, all of it is too little, too late and funeral pyres for oil industries of many countries may start burning pretty soon, but then again--nothing personal, just business. It is just the start of the process and who knows where will it lead. Oil prices are crashing no matter what now and we all know what it means, but at least some fuzzy shape of the global oil cartel begins to emerge and that is exactly what Russia demanded. In a funny twist, Putin and Trump also discussed in their phone call exploration of space. Why not. Russia has some interest in seeing the United States getting used to new world order. As Scott Ritter noted:

Russia has the US between a rock and a hard place. The only question that remains is how much pain does Russia intend to inflict, and at what cost? It is unrealistic to expect Trump to exert influence on a fragile US oil market. But by sustaining the pressure generated by free market realities, Russia may be able to leverage any relief it can provide for long-term US sanctions relief. This is the real game being played, and should be kept in mind as the G20 gathers to discuss the future of global oil markets.

You see, once the military threat from the United States was addressed in the most dramatic way, new rules started to get enforced. Indeed, Russia can handle any sanctions the US can introduce, but Iran needs urgent help--she need IMF loan to fight Covid-19 pandemic, she also needs all help she can get including from EU which is beginning to cautiously bypass US sanctions on Iran. Venezuela needs help, Yemen's slaughter supported by the US also needs to stop. So, you see--there are so many issues to discuss between Russia and the United States. As old Arabic proverb says: if the mountain doesn't go to Mohamed, Mohamed goes to mountain. Russians are proud people but when is needed they go to mountain and when they go... well, you know this blog for 6 years, don't you? It documented it thoroughly. It is a new brave world out there and we all need to survive its unfolding. Playing by the common sense rules increases chances of survival dramatically. And that is the name of the game. 

Preliminary Results.

As you know, OPEC+ was "meeting" today (on-line) in discussion on oil production cuts and throughout the day all kinds of "sources" continued to feed disinformation on the size of possible cuts in attempts to manipulate market. At some point of time the rumor of cut of 20 mbds even circulated as an information from some source "close to negotiations", right. I am also a source close to negotiations about quotas for mining beryllium on Saturn. But here is what is known so far and it seems to be real:

OPEC has succeeded. On Thursday, the OPEC++ group agreed, in principle, to cut 10 million bpd in oil production, according to media. But will it be enough? Today’s oil prices suggest not. As oil inventories burst at the seams and threaten oil prices the world over, the oil markets have been riveted by the Organization of Petroleum Exporting Countries’ (OPEC) actions as it relates to potential production cuts. While many analysts doubted that the group, and various other states who agreed to sit down with OPEC to hash out a new market stabilization plan, would cut as much production as would be necessary to draw down inventories, the group’s actions have never been more crucial to the survival of the entire oil industry.

Of course it is not going to be enough, but enough for who? You know the answer. And, in the end, the issue for US shale oil is not resolved and yet another discussion on cuts will be held at G-20 meeting. US shale oil to survive needs the price of crude to be, by different estimates, way in excess of $45. And this is an "optimistic" threshold. I am not an oil expert, never pretended to be, but I don't see this happening. You can see oil prices (almost in real time) here. So, sober opinions of people around US oil have been making it to media.

Many analysts expect a deal to cut production would have to involve the United States. According to his spokeswoman, Secretary of Energy Dan Brouillette will participate in the G-20 meeting, “to discuss with his counterparts around the world the urgent need to restore calm to global energy markets.”

So, the glut which Saudis created is here to stay for a while. Just as a reminder: Russia's budget was written with $40 price per barrel in mind and since then it was updated for even lower price. Per Saudis? I already expressed my opinion on that earlier last month and I may only reiterate:

That may help to explain why Saudis are going nowhere, because, as I write for years, tangibles win in the long run, and even if to imagine that somehow Saudis will survive next 4 years without consuming their $500 billion worth of reserves (sure, and I am Clint Eastwood) in the economy which produces next to nothing, Russia's National Projects will be already in their full steam and those are ranging from cutting edge research, aerospace, machine-building complex and other things of which Saudis have very little understanding.

So, the story continues and who knows when it ends. WTI still dropped more than 2% as of writing this, while Mexico altogether refused any cuts and, in fact, boosts output. So, let the real experts in oil/energy market excavate this pile of contradictory information and make sense of it.

Meanwhile, frigate Admiral Goshkov continues to test 3M22 Zircon and departed three days ago for Belomor Naval Base to be loaded with Zircons (in Russian) to continue with tests. As TASS reports, 4 more test-launches should be conducted by the end of this year. In general, the events unfold with such speed that, as I predicted, they throw me constantly off the track while writing a preliminary outline for my new book--it is simply impossible to grab the tiger by the tail. I am trying, though.    

Stage-3 Butt-Hurt.

Bloomberg (yes, this famous propaganda outlet) produced today a fascinating example of delusion and an extreme, stage-3, butt-hurt, stage-1 and 2 being butt-hurts which still could be controlled by meditation and delusions. Stage-3 however, while allows one to produce delusions hits hard because those who stick to this delusion begin to understand that this is just that--a delusion and begin to grasp, however fleetingly, an unfolding reality. This is what makes Stage-3 so painful and makes delusions so unconvincing.  Get a load of that:

The real wild card here has been the coronavirus. Not just the direct economic hit, but also Putin’s distant initial reaction and the lack of a fiscal boost, which means he hasn’t seen the sort of rallying effect in the polls that has helped U.S. President Donald Trump and other political leaders. Nigel Gould-Davies, at the International Institute for Strategic Studies, suggests the risk is a repeat of Putin's Kursk debacle two decades ago, when his perceived leadership failure at the time of the submarine tragedy triggered widespread criticism. This isn’t a threat to the plan to change the constitution to allow him to stay on, but his “father of the nation” gambit may be harder to implement, especially if Russia’s under-resourced health system buckles.

The cretinism of this statement is such that it is even difficult to deconstruct it because it is basically a verbal diarrhea which even those who produce it know is shit. Reference to Kursk disaster and alleged "criticism" of Putin, of course, misses this teeny-weeny fact that it was precisely Kursk tragedy which DID reveal to Russia Vladimir Putin Russians came to know and appreciate. Then there was an end to war in Chechnya, then there was a Nord-Ost hostage drama, then there was a tragedy of Beslan and through all of this Putin  emerged as a true statesman and a national leader. But as it was always the case Western journos and "analysts" have huge issues with causality, that is they cannot properly tie together cause and effect (which is normal for people who have no viable education). Drawing parallels to Donald Trump's rating to Putin's position as a national leader is the same as comparing a high-school musical to opera from La Scala. But that is Western journos for ya. 

But why, one may ask, such statements:

Moscow is pragmatic. But Trump will need to make some concession-like noises at least on American production cuts, to help Putin save face. Not easy, but given the shut-ins already triggered by the price fall, also not impossible, with the help of U.S. state energy regulators.

LOL. So, it is not about killing, or letting live, US shale oil whose fate is in Russia's (not even Saudi) hands but to "help Putin save face". This is Stage-3, folks. It is a level of butt-hurt which triggers the only "defense" one hurting (in the butt) can offer--to project own pain onto those who are just alright. You  know like the statement on Russia's "under-resourced" health care. But why, why (wink, wink) such a drama--here is the answer.  

“The U.S. oil industry is being wrestled to the ground by the Russians and Saudis,” Michael Lynch, president of Strategic Energy and Economic Research in Winchester, Massachusetts, said before the report was released. “Involuntary participation is the best way to put it.” EIA forecasts that the U.S. will return to being a net importer of crude oil and petroleum products in the third quarter of 2020 and remain a net importer in most months through the end of the forecast period. The agency expects Brent, the global benchmark crude, to average $33.04 a barrel this year, down from earlier expectations of $43.30.

Ah, that's warmer. But here is even more increased temperature:

A deal still hinges on some form of co-operation with America, according to delegates involved in the talks. That may be difficult for OPEC to achieve, as President Donald Trump resists any partnership with the cartel that he’s vilified for years. However, the collapse in crude prices to 18-year lows has triggered deep reductions in U.S. drilling that mean a drop in production is inevitable, which could be enough to satisfy Saudi Arabia and Russia. “Nobody’s asked me, so if they ask I’ll make a decision,” Trump said on whether the U.S. would participate in cutbacks. American producers are “already cutting back and they’re cutting back very seriously. I think it’s happening automatically.”

So, Trump DOES make "some concession-like noises" after all to "help Putin save face" as we are told. And sure, he absolutely must "help" Putin to save "face" because the US shale oil industry is being wrecked completely even this very minute I type this, and the United States can do absolutely nothing about it unless (and even this may be too little, too late) it does cut production and gets to negotiate, de facto joining OPEC+ and turning it into OPEC++. If not, follow the news in coming weeks. I warned, genuine multi-polarity is a bitch--one suddenly needs to calculate consequences, a skill long time ago absent from current US political class, which is not surprising once one learns how the "history" is "taught" in the US and, this ever present trouble with cause and effect, add here the sudden epiphany about own self experienced through the acute, Statge-3, pain in the rear and, who knows, one may begin to suspect that producing verbal diarrhea is not the best way to deal with cold hard facts. This, mind you, without us going into the issue of REAL productive economy, which the United States needs to return in some form to its shores, thus giving itself at least some chance to survive intact. But that is a huge, separate discussion in itself since the projection numbers on the US GDP are staggering:

The bank expects second quarter GDP to contract by 33.5%, according to a Monday note. That means the period from April 1 to June 30 is shaping up to be the worst quarter on record going back to 1945, analysts led by Jonathan Golub wrote. It shows the stark effect the coronavirus pandemic is having on the US economy. In the financial crisis, the worst quarter of 2008 suffered only an 8.4% GDP slump, according to Credit Suisse. Coronavirus is also outpacing the previous record — a 10% slump in the first quarter of 1958, amid the Eisenhower recession. 

What it all means in real terms, even if the economy "bounces" back in some way in the future, nobody knows in the United States, unless we are talking about minds of the scale of Michael Hudson. Meanwhile, printing press is overheated and with each cycle it spells the end of the US Dollar as we know it and that can push butt-hurt to 11, granted we somehow survive to observe and experience it. I am not looking forward to it.

Trump's World 2.0

I already noted that The Donald has this tendency to exaggerate, let's call it that, somewhat few days ago when he claimed that he "brokered the deal" between Saudis and Russia on oil. Sure he did, and I know where the body of Jimmy Hoffa is buried. Reality has this bitchy tendency to correct people who deny it. So, it did. 

(Bloomberg) -- President Donald Trump ramped up threats to use tariffs to protect the U.S. energy industry from a historic glut of oil, as efforts to forge a global deal to cut output appeared to lose momentum. Trump said Saturday at a White House press briefing he’d use tariffs if needed to protect the domestic oil industry, even as he predicted that Saudi Arabia and Russia would come to an agreement to cut output and stem the rout in prices. But such a deal looked a bit further from reach at the weekend after a diplomatic row between Saudi Arabia and Russia. A gathering of OPEC+ members and other producers scheduled for Monday was pushed back, to give more time for negotiations.

But, wait a minute, just two days ago he said that everything was ready to go. Hm. Of course it was not, because Russia is not going to negotiate anything until the United States joins in--the step Trump tries to avoid, evidently, by all means. I am not a specialist in oil industry, far from it, but here is what Trump and US oil industry are facing, and I quote:

Hundreds of thousands of U.S. oil industry jobs are hanging in the balance, with about $15 billion of investments wiped out from the budgets of shale explorers and many of them on the brink of bankruptcy.

The condition to Trump was articulated, in fact, spelled in the most clear and easily understood way: Russia is going to negotiate ONLY on the condition of the United States joining those negotiations and showing readiness to cut own production.It is either that or the United States cuts production in the most uncontrolled manner down the road due to obvious economic depression unfolding in a front of our very own eyes. When writing about Noblesse Oblige five days ago I assumed that the United States will behave itself as a true superpower--I was wrong. Nor the issue of North American refineries which are very specifically "tuned" for different types of crude is properly discussed. If that wasn't bad enough, "good" news continue to pour in for Boeing's B-737 Max, with Boeing losing a contract for another 75 B-737 Max. Ain't the globalism grand? 

UPDATE: same day. 

(Reuters) - Boeing Co <BA.N> said on Sunday it would extend the suspension of production operations at its Washington state facilities until further notice amid the coronavirus outbreak. The largest U.S. planemaker said on March 23 it would halt production at its Washington state twin-aisle jetliner factory as a temporary measure to help fight the outbreak of the respiratory disease. Production had been expected to resume early this week. Boeing declined to say when production could resume. It said the actions were "being taken in light of the company's continuing focus on the health and safety of employees, current assessment of the spread of COVID-19 in Washington state, the reliability of the supply chain and additional recommendations from government health authorities."

One word: WOW!

OPEC Issue.

There is an OPEC issue which popped up in the last couple of days--it is sudden realization that OPEC doesn't mean that much in terms of oil production (or cuts in it) without...yes, Russia. It occurred to Forbes that:

But today OPEC faces Russia, a non-OPEC member who, over the last three years, has managed to obtain for itself a practical veto power over OPEC decisions. Russia has become the second most powerful oil producer in the world, and this is not just because it is the second largest oil producer in the world.

Damn, those Rooskies weaponize everything, from sausage, to cartoons to oil production. But the truth of the matter is that in reality, unlike it was the case with Masha and the Bear, Russia DID "weaponize" oil production because... because... because she can. As Forbes is longing for those higher oil prices to return, it notes, in desperation:

Only Russia can bring those prices back. Only Russia can make a deal. Only Russia can give these powerful oil producers what they want. Russia hold all the cards.

No, Russia is not bringing those prices back, not yet anyway, and there were already events which may testify to a rather grim mood in the Kingdom of Saudi Arabia which is the backbone of OPEC. They uncovered yet another coup conspiracy there. Oh, boy. But what are those proverbial cards Russia holds? Two of them: 

1. Russia's economy, as I, and others, write about for years and years IS NOT hydro-carbons' extraction and export dependent or oriented. Not only Russia's non-hydro-carbons exports was shrinking  relative to Russia's other exports (in Russian), but Russia's military and agricultural exports become increasingly important, together with other high value added exports. This is not to speak of Russia's budget being formed primarily by other, non-raw materials, contributors. But as I repeat ad nauseam, people who calculate economy in US Dollar "values" fail to comprehend this fact--they simply have no frame of reference other than the speculation bubble of financial markets.

2. Russia is military superpower, period. Anyone wants to fight Russia? Well, I am sure there are some lunatics out there but even NATO knows that it stands no chance, despite all chest-beating and posturing. 

So, Russia goes about it her own way: she will continue to extract geopolitical and economic favors for herself while simultaneously pacifying the region, Middle East and adjacent regions that is, because only peaceful and stable region insulated form "activities" from Gulfies' satrapies and the United States allows to form real market there and then shape it as a reliable recipient of Russia's goods, real, tangible ones. Such market must be stable and peaceful. So, that's the message from Russia to OPEC and others. As you can see yourself, investments into real cutting edge weaponry, which is predicated on a development of modern industry (as in manufacturing) is a very wise investment, when one counts own country not as some collection of individuals but as a nation. Raw power matters and it wasn't Russia who established these rules.  

In related news. Russia's Black Sea Fleet and Southern Military District are on the verge of morale and discipline breakdown and Russia is about to abandon Crimea because the United States are supplying Ukraine with mighty Mark VI patrol boats: 

According to CNN, the new assistance package includes counter-artillery radars and armed Mark VI patrol boats, the latter of which is seen as particularly important given Ukraine’s tensions with Russia in the Black Sea and the Sea of Azov.The MK VI designed to fulfill the requirement for an armored boat with greater range, more lethal firepower and sea keeping capabilities that exceeded the Navy’s small boat capabilities. They can conduct missions in the open ocean for protecting defence forces. The versatile patrol vessels can support search-and-seizure operations, maritime intercept operations, theatre security cooperation operations and other clandestine security force activities. They can function as escorts for high-value assets and also take part in mine hunting and fast attack combats. The 85-foot-long vessels averaged a speed of 25 knots, just under 30 mph.

Make no mistake, those are nice boats, it's just that they are good only, once one discards all fluffy Pentagonese descriptions of those, for.... being sunk in case of doing stupid things in the Sea of Azov or Black Sea. It takes single SU-30 SM with anti-ship (ground-attack) package to...well, you know. 

Nice boats, indeed, and you know my soft spot for Mosquito fleet.