April 15, 2021

Russia's Nord Stream 2 pipeline nearly complete, faces US sanction threats

Russia's Nord Stream 2 pipeline nearly complete, faces US sanction threats

The Prudentialist submitted this article.

Earlier this week, American President Joe Biden had a phone call with Russian President Vladimir Putin. Biden and Putin discussed a variety of issues including arms reduction, cybersecurity, and the ongoing Russia-Ukraine tensions. Both nations have been amassing troops near the borders of the disputed Donbas territory, with the Russian military buildup in the region at its highest since the annexation of the Crimean peninsula in 2014.

Conspicuously absent from the official readout of the phone call was any mention of the Nord Stream 2 pipeline. The 734-mile (1,230-kilometer) pipeline would carry Russian natural gas to Germany by way of the Baltic Sea. It would also potentially strengthen the Kremlin’s existing leverage on Europe’s energy policy, with nearly 40% of the EU’s gas supply already coming from Russia. Numerous Western leaders have called for sanctions targeting the project following the arrest of opposition figure Alexei Navalny by Russian authorities. Some have also called for a halt to construction due to the pipeline’s alleged environmental impact. Now, the escalating tension between Russia and her neighbor Ukraine threatens the future of the pipeline as well.

Nord Stream 2 follows the same route under the Baltic Sea as the first Nord Stream pipeline, which was originally proposed in the late 1990s and completed in 2012. The original pipeline had also faced significant opposition, primarily from Baltic states that were cut off as Russia directed the flow of gas directly to Western Europe. Then-Polish defense minister Radek Sikorski even compared the agreement between the German and Russian governments to the Molotov-Ribbentrop Pact between Nazi Germany and the Soviet Union. Nord Stream has also faced severe criticism over its alleged environmental impact from the German Green Party -- criticism which the United States encouraged under the Trump administration. More recently, the Biden Administration has threatened sanctions on German corporations participating in the project. This has increased the strain on US-German relations after four years of tension between Berlin and the Trump administration.

The Nord Stream projects have demonstrated how Russia combines energy policy and foreign policy. The first pipeline bypassed most of Eastern Europe, but Ukraine was the most affected, losing out on the ability to collect transit fees. The 2009 Russia-Ukraine energy dispute provided Russia with further justification to avoid transporting gas over land. Since then, Ukraine has increasingly aligned herself with the West and NATO, making it even more in Russia’s strategic interest to deny Ukraine a source of revenue. In turn, this exacerbates the ongoing tensions between Russia, Ukraine, and the United States.

It’s unclear whether American sanction threats against German companies will kill Nord Stream 2. The German Greens, who adamantly oppose the pipeline, may increase their influence following the September elections. For now, German Chancellor Angela Merkel is allowing Russia to proceed with the project, even as her government issues statements criticizing Russia for amassing troops on the Ukrainian border. President Biden has called for a summit to discuss the ongoing tensions in Ukraine. Whether or not the United States will continue to intervene in the Nord Stream 2 project, the Russia-Ukraine dispute, and other European affairs remains to be seen.