How Putin’s $11 billion pipeline divided NATO and the EU in times of crisis

The United States, United Kingdom, Ukraine and several European Union member states have fiercely opposed the pipeline since it was first announced in 2015, warning that the project would boost Moscow’s influence in Europe.

According to experts, this in itself is a victory for Russian President Vladimir Putin.

Kristine Berzina, a senior fellow at the German Marshall Fund of the United States, a nonpartisan research center, said Moscow had benefited from the drama around the pipeline. “Everything about the Nord Stream 2 pipeline was a victory for Russia,” she told CNN.

“Given that Russia’s goal is to divide everyone, if they seek to break unity in the European Union and in NATO, this pipeline has been a wonderful vessel.”

For years, Russia and Germany argued that the pipeline was purely a business venture and had nothing to do with politics.

But in Central and Eastern Europe, where Russian gas supplies play a vital role in power generation and home heating, few topics are more political than energy security. With natural gas prices already near record highs, many fear further tensions could cause more suffering for European consumers.

And while Russia has denied using the energy to pressure Europe, the International Energy Agency has blamed Moscow for contributing to Europe’s gas price crisis by cutting off supplies. .
The United States and Europe are preparing for the possibility that Russia could weaponize its gas exports to Europe to retaliate against possible sanctions. The Biden administration has had regular discussions with a number of countries in Europe, the Middle East and Asia about increasing their production of liquefied natural gas to Europe in the event of a Russian invasion of the Ukraine would lead to gas shortages, several US officials familiar with the discussions told CNN.
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As Russia’s biggest gas customer, Germany had been reluctant to use the pipeline to pressure Moscow. Less than two weeks ago, German Defense Minister Christine Lambrecht warned against training Nord Stream 2 in the conflict.

Yet as tensions grew between Russia and the West over Ukraine, the claim was quietly dropped by the Germans. Under pressure from the United States, German Foreign Minister Annalena Baerbock acknowledged last week that the Nord Stream 2 gas pipeline could be included in a sanctions package against Russia for its involvement in Ukraine.

At the same time, the United States has somewhat reduced its vocal opposition to the pipeline. Earlier this month, the US Senate rejected legislation by Republican Senator Ted Cruz of Texas to sanction entities associated with Nord Stream 2. The Biden administration’s main argument was that sanctions on the pipeline would undermine US efforts to deter the Russian threat by giving the West less influence.

“Putin wants to see Nord Stream 2. If somehow he is killed before any potential invasion, he has one less reason not to invade Ukraine,” said the US Senate Speaker. External Relations, Bob Menendez.

Pipe systems are seen at the Nord Stream 2 gas receiving station in Lubmin, Germany.

Ukraine and other Eastern European countries have warned that the new pipeline could make the region more vulnerable to Russian whims.

Disputes over energy prices have plagued relations between Russia and Ukraine since the collapse of the Soviet Union in 1991, with Russia repeatedly cutting off gas supplies to Ukraine. Right now, Russia needs Ukraine because much of the gas it sells to Europe is still flowing to the rest of the continent through Ukrainian territory.

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By bypassing Ukraine, Nord Stream 2 would make it easier for Russia to isolate Ukraine.

Germany’s decision not to supply arms to Ukraine makes the situation even more complex. While several other NATO countries, including the United States, the United Kingdom and the Czech Republic, have said they will send weapons to the country, Germany has so far refused, drawing criticism from Ukrainian officials.
German Navy chief Vice Admiral Kay-Achim Schönbach’s controversial remarks that Putin ‘probably’ deserves respect and suggesting that Ukraine had permanently lost the Black Sea peninsula of Crimea to Russia only aggravated the tensions. While Schönbach resigned over the comments, Ukraine’s Ambassador to Germany Andrij Melnyk said on Sunday that the German government “must change course towards Kyiv” in order to “restore full confidence in German politics.”
Runners pass pipes for the Nord Stream 2 gas pipeline at Mukran Port in Sassnitz, Germany.

The pipeline is particularly valuable to Russia, which depends on oil and gas exports for more than 40% of its government revenue. If operational, it would deliver 55 billion cubic meters of gas per year directly from Russia to Europe. Gazprom, the Russian state company that owns the pipeline, said its average export price was $280 for 1,000 cubic meters of gas in 2021, meaning the new pipeline could be worth more than $15 billion. dollars per year.

Gazprom has already invested some $11 billion in the project.

“The West needs every form of leverage possible to deter Russia from invading Ukraine,” Berzina said, adding that not sanctioning the pipeline now means it could be used as leverage in the future. . “Russia’s ambitions at this time are enormous and the explicit demands it has made of the West to bring the troops back to where they were in the early 1990s and close the door to NATO enlargement , it’s not in line with Western values, so the West really can’t give Russia what it wants there.”

Andrey Kortunov, director general of Russia’s Council for International Affairs, said Moscow saw the Nord Stream project as a test of the EU’s strategic autonomy from the United States.

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“If the Nord Stream 2 project falls through, which is possible, it would confirm this perception that Europe is not a reliable partner and that we cannot work with the European Union because they can’t agree on anything and they can’t make every decision. So if you want something done, you should go to Washington,” he said.

Russia has repeatedly warned the West not to drag Nord Stream 2 into the political crisis. Russian Foreign Minister Sergei Lavrov said attempts to politicize the Nord Stream 2 issue were “counterproductive”.

But while the pipeline is hugely valuable to Putin, it’s doubtful it could play a decisive role in persuading him to scale back any plans to cross the Ukrainian border.

“If this fails it will be a big loss for Gazprom and the Russian economy, but it’s not like the Russians would say okay, you can go ahead with NATO enlargement, but as long as Nord Stream 2 is up and running, it’s fine,” Kortunov said.

“The question is what is [Putin’s] ultimate goal? He has the money, the currency reserves that Russia has saved up, they can afford to lose money right now… is the economic relationship, the pipeline, is a cost that he is ready to pay?” added Berzina.

CNN’s Natasha Bertrand contributed to this report.

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