One of the supposed side-benefits of the collapse of the price of hydrocarbons is that various noxious jurisdictions – which had been flush on petro-dollars – have much lower cash-flow and thus much less ability to cause trouble.

However, one overlooked economic error involves focusing solely on the “price” of something in the open marketplace. If you need something but can’t get it, the price is effectively infinite.

So? Well, Russia is now expanding its “gas offensive” beyond Ukraine, and is apparently targeting other European countries.

Six countries reported a complete shutoff of Russian gas shipped via Ukraine on Tuesday, in a sharp escalation of a struggle over energy that threatens Europe as winter sets in.

Bulgaria, Greece, Macedonia, Romania, Croatia and Turkey all reported a halt in gas shipments from Russia through Ukraine. Croatia said it was temporarily reducing supplies to industrial customers and Bulgaria said it had enough gas for only “for a few days.”

For the moment, it’s difficult to say what’s really going on here. The Russians are saying that the Ukrainians – cut off last week – are diverting gas intended for customers elsewhere in Europe. The Ukrainians deny this. Who knows.

This will need to be watched closely. As your humble correspondent wrote in his musings on 2009′s trouble-potential, the core Putinesque-Russian-nationalists believe that they must make Russia great again to save Russia from self-destruction. Despite the price collapse, much of Europe is still very dependent on Russian gas – at any price – to literally keep warm and to keep their economies going. This is too tempting a target for Putin and co. to just ignore.

Although Ukraine says that it has stored up several months worth of gas supplies and should be able to cope, the Ukrainian economy is already in a precarious condition and can’t take much more.

And naturally this comes (unlikely by accident) at the worst possible time for Europe in general – given that it’s the middle of winter and that economies are already in a very weakened condition.

Swinging boldly into action,

The European Union in Brussels called the sudden cutoff to some of its member countries “completely unacceptable.”

And the bold, strong, decisive action that the EU is taking in this matter is:

In a strongly worded statement, the EU complained….

(No need to read beyond that….)

Russia is weak, but the rest of Europe is weaker. Russia is in a hurry. And the Russians have clearly concluded that they will get no pushback from the incoming administration….