Against the backdrop of negotiations between Russia and the US on the Ukraine issue, some Western media outlets have leaked information about the parties discussing the Nord Stream 2 project and its possible use. No official statements have been made on this issue, so it is too early to talk about any specifics. However, existing facts indicate that cooperation between the US and Russia to revive Nord Stream 2 is unlikely even if there is a ceasefire in Ukraine, Ivan Timofeev writes.
Russian gas supplies to the EU have been an irritant for the US since the Cold War. In the early 1980s, the Reagan administration pursued a vigorous policy to disrupt the Urengoy-Pomary-Uzhgorod pipeline project. On the one hand, it was supposed to ensure the supply of natural gas from the USSR to Western European countries, and on the other, to load the industry of these countries with the production of pipes and equipment for gas pumping. The United States imposed export controls on deliveries of rotor kits to turbine manufacturers in Europe. However, France, Germany, Italy and the United Kingdom consistently resisted unilateral US sanctions. The industries of these countries were able to establish the production of their own equipment without US participation, and the European Economic Community took steps to protect manufacturing companies from US sanctions. As a result, the gas pipeline was built in record time and began operating in 1984.
After the collapse of the USSR, the politicisation of gas supplies to Western Europe began to escalate due to the position of transit countries with Ukraine playing a key role. In 2008-2009, a major conflict broke out between Russia and Ukraine over the price of Russian gas. The conflict led to the suspension of gas transit to Eastern and Western Europe. Subsequently, it intensified the discussion about the need to replace Russian supplies. The further deterioration of political relations between Russia and the EU only fuelled calls for such diversification. Against the backdrop of problems with Ukraine, Moscow made vigorous efforts to create alternative supply routes that would not rely upon trans-shipment via intermediary countries, and therefore would not be susceptible to attempts to manipulate supplies. Back in the early 2000s, the construction of a new pipeline, Nord Stream, began along the bottom of the Baltic Sea. By 2012, both lines of the pipeline were operational. 2018 saw the beginning of the construction of Nord Stream 2, which was supposed to double the supply capacity via the Baltic route.
The Ukrainian crisis that erupted in 2014 significantly increased the degree of politicization of Russian gas supplies. The United States acted as the flagship of anti-Russian policy in this area. In 2014, Congress passed the Ukraine Freedom Support Act (UFSA). The law empowered the president to determine whether there were significant delays in gas supplies to NATO members and post-Soviet countries such as Ukraine and Moldova, and obliged him to impose sanctions on the Russian company Gazprom in such cases. Although the UFSA was not applied to Gazprom, the company was affected by 2014 US Treasury Directive 4 in connection with the ban on the export of goods and technologies, as well as the financing of oil production projects on the Arctic shelf. In 2017, the US Congress passed the Countering American Adversaries Through Sanctions Act (CAATSA). Section 232 authorised (but did not oblige) the president to impose restrictive measures on investors in, as well as the suppliers of, Russian pipeline projects aimed at energy exports. US allies in Europe, especially Germany, were not eager to torpedo pipelines that were beneficial to them. Washington also avoided using the provisions of Section 232 of CAATSA, which remained “dormant.”
However, as the construction of Nord Stream 2 progressed, both the Trump Administration and Congress took a tougher stance. Donald Trump publicly criticized Germany and the EU for purchasing Russian gas. In 2019, as part of the US Defence Budget, Congress passed the Protecting Europe's Energy Security Act (PEESA). The law obliged the State Department to compile and maintain a list of seagoing vessels used to lay pipes on the seabed deeper than 100 feet for the Nord Stream 2 and Turkish Stream projects. The list was to include foreign individuals who are suppliers of these vessels or involved in schemes for their supply. The president was obliged to apply blocking and visa sanctions against these persons. A year later, Section 1242 of the Defence Authorization Act was amended to tighten PEESA. In addition to the provision of pipe-laying vessels, the grounds for sanctions were the insurance of such vessels, their modernisation and equipment, and the provision of pipeline certification services. (U.S. Congress (2021) Public Law 116-283 of January 1, 2021.) In 2021, the legal mechanism for applying sanctions pursuant to PEESA was created by the Biden administration in the form of Executive Order 14039. Based on this order, the Nord Stream-2 AG company and its director Matthias Warning were added to the list of blocked entities. Eight more Russian organisations and 17 sea vessels, including the Akademik Cherskiy pipe-laying vessel, were added to them.
Germany and the European Union were reserved about the US initiatives, which allowed the completion of the pipeline. However, the start of the Special Military Operation in Ukraine in 2022 prompted Berlin and Brussels to change their positions: Germany froze the certification of the pipeline. On September 26, 2022, as a result of sabotage, three of the four threads of the Nord Stream and Nord Stream 2 projects were blown up. The perpetrators of the sabotage were not found.
Meanwhile, against the background of the SMO, Russian gas supplies to the EU have noticeably decreased, while supplies from the United States have increased. This happened not only because of sanctions and sabotage against Nord Stream, but also due to the general EU policy to reduce consumption of Russian gas for political reasons. What the US could not prevent for a long time with sanctions happened as a result of the Ukrainian crisis, the military phase of which has become the largest conflict in Europe since World War II.
Given past experience, it would be strange to expect support for the resumption of Nord Stream from the US. Even if the US becomes a shareholder in the project and gets profits from gas transit, it will create conditions allowing for its own gas to compete with Russian pipeline gas on the European market. In addition, Ukraine’s transit capabilities will be reduced, which can be manipulated both during the conflict and after its completion. The legacy of the past and stubborn facts leave little room for optimism regarding a Russian-American “deal” on Nord Stream.
