Rabobank’s Michael Every told clients this morning about a very alarming situation emerging in the Baltics regions:
So, if you want to worry, look at less glamorous but arguably more significant headlines that don’t point to world war, per se, but to world disruption, and major world market volatility.
Official allegations of sabotage were made in the EU as: two of Finland’s five nuclear plants had to be shut down; a key Norwegian oilfield was shut by a power outage; the support cable on a Finnish suspension bridge broke; and two key Baltic EU data cables were severed. The Chinese vessel Yi Peng has been flagged as a possible cable culprit and at time of writing was forcibly moored in Denmark. This is likely to prompt a strong Chinese diplomatic response; and perhaps an EU one if it proves a Chinese ship damaged key seafloor infrastructure (again: this also happened to a gas pipeline between Finland and Estonia in October 2023).
Every’s full note, titled “Once You See ‘World War 3’ Headlines, You Might As Well Buy Everything Because Why Not,” can be read here.
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Update (0800ET):
The Finland National Bureau of Investigation stated that, based on a preliminary investigation, it has “decided to open a criminal investigation into the damage caused to the sea cable.”
Here’s the statement:
Based on preliminary inquiries, the National Bureau of Investigation (NBI) has decided to open a criminal investigation into the damage caused to the sea cable between Finland and Germany. The suspected criminal act is currently investigated as aggravated criminal mischief and aggravated interference with communications.
The National Bureau of Investigation is conducting an investigation into the damage caused to Cinia’s C-Lion-1 telecoms cable. The decision to open a criminal investigation was made today on Wednesday 20 November in cooperation with the Office of the Prosecutor General. Cinia submitted a request for an investigation to the NBI on Tuesday 19 November.
At this stage, the suspected criminal act is investigated as aggravated criminal mischief and aggravated interference with communications, but these may change as the investigation progresses.
The police will be releasing information on the progress of the criminal investigation at a later date.
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Update (0729ET)
On Monday, the Yi Peng 3, a Chinese-registered bulk carrier, was suspected of damaging two fiber-optic data cables beneath the Baltic Sea, which connect Finland, Germany, Sweden, and Lithuania. The bulk carrier is anchored in Kattegat Bay alongside a Danish Naval vessel.
The ship tracking website MarineTraffic shows the Danish Naval vessel “DNK NAVY PATROL P525” alongside Yi Peng 3 in Kattegat Bay. Both vessels are anchored.
X user Visegrád 24 claims military personnel from the Danish military vessel boarded Yi Peng 3.
“Denmark exercised the right under Art. X of the Submarine Cables Convention. It’s been done only once before, by the USA in 1959,” the X user said.
And this.
On Tuesday, Germany’s defense minister called severing the Cinia C-Lion1 submarine cables an act of sabotage.
“Nobody believes that these cables were severed by accident,” Germany’s minister of defense, Boris Pistorius, told journalists ahead of a meeting in Brussels.
Pistorius said, “Therefore we must state — without concrete knowledge of who was responsible — that this was a hybrid action,” adding, “And we must assume, without being certain, that this was sabotage.”
The foreign ministries of Finland and Germany released a statement on Monday night, warning:
“Our European security is not only under threat from Russia’s war of aggression against Ukraine, but also from hybrid warfare by malicious actors. Safeguarding our shared critical infrastructure is vital to our security and the resilience of our societies.”
“Some of the Baltic Sea countries affected by the destruction of undersea telecom cables by the Chinese vessel Yi Peng have announced how they’re classifying their investigations,” Visegrád 24 noted.
According to the Wall Street Journal, citing sources, Sweden, Finland, Lithuania, Germany, and other EU countries have found in preliminary investigations that the cables were likely severed in Swedish economic waters.
“The likely motive behind this clandestine offensive is to spread panic, bind security resources, and increase pressure on Western governments by boosting political parties who are campaigning against the massive aid provided to Ukraine, according to politicians, security and law-enforcement officials and intelligence operatives from several European nations and the U.S,” WSJ said.
Data disruptions have so been minor for European countries…
“We prepare for events like this, and there are multiple cables and routes for contingency, so the net result of this is only slower service for some providers,” a senior Finnish official said.
Our report on Monday noted that repair work to restore data transmission via Cinia C-Lion1 submarine cables fully could take upwards of two weeks.
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Authored by John Konrad of gCaptain,
A day after the C-Lion1 and BCS subsea data cables in the Baltic Sea, connecting Finland and Germany as well as Sweden and Lithuania, were damaged, specifics of the incident remain unconfirmed.
The incident is reminiscent of a similar event in 2023 when the Balticonnector between Finland and Estonia was damaged. Hong Kong-registered container vessel NewNew Polar Bear was later found to have dragged its anchor across the pipeline.
Danish authorities appear to have narrowed down a possible culprit to Chinese bulker Yi Peng 3, which traveled over the reported incident site at the time of the failure. Its AIS track shows the vessel drifting back and forth for around an hour the morning of November 18.
By the time Yi Peng 3 reached Danish waters the country’s Navy had dispatched several vessels shadowing the vessel. Online reports suggest that a Danish pilot was placed onboard the vessel during the afternoon of November 19 as it continued passing through the Danish Straits.
AIS data show several Danish patrol vessels in the vicinity of Yi Peng 3 and shorebased webcams confirm Navy vessels loosely following in its wake.
The foreign ministers of Germany and Finland issued a joint statement expressing concern about the incident. “The fact that such an incident immediately raises suspicions of intentional damage speaks volumes about the volatility of our times,” the statement reads.
“A thorough investigation is underway. Our European security is not only under threat from Russia’s war of aggression against Ukraine, but also from hybrid warfare by malicious actors. Safeguarding our shared critical infrastructure is vital to our security and the resilience of our societies,” the statement continued.
Incidents with damage to subsea cables and pipelines across Europe have increased in recent years, including in the Arctic. In 2022 Norway reported that an undersea fiber optic cable connecting a satellite ground station on Svalbard to the Norwegian mainland was severed. Norwegian media reported a Russian vessel traveling back and forth several times over the damaged section.
The Finnish investigation of the NewNew Polar Bear incident concluded that the vessel dropped its anchor during a storm dragging it over the Balticonnector pipeline. The vessel had been spotted with a missing anchor during its first port call following the incident.
After initial stonewalling by Chinese authorities Finnish counterparts launched their own investigation and eventually admitted that the pipeline’s damage was caused by NewNew Polar Bear. Like Yi Peng 3, NewNew Polar Bear had departed from a Russian port prior to the incident.