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Germany under U.S. pressure over Russian pipeline

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Two workers construct the wall of the Nord Stream 2 pipeline.

Workers building a section of the wall of the Nord Stream 2. Carsten Koall/Getty Images

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The United States’ battle with Russian President Vladimir Putin is heating up.

Last week, the Biden administration slapped fresh sanctions on Russian officials over cyberattacks and “other hostile activities.”

And in a move that showed it’s even prepared to target allies in the campaign to curb what it considers malign Russian behavior, the White House stepped up pressure on the German government over a major pipeline deal. The U.S. warned it is ready to impose further penalties against the Nord Stream 2 project, which is designed to carry natural gas directly from Russia to Germany, its biggest customer, avoiding the main overland routes across Eastern Europe.

The underwater pipeline, more than 1,500 miles long and costing more than $11 billion, is almost complete, but the U.S. continues to oppose it as a geopolitical threat, arguing that it will undermine the stability of Eastern Europe, weaken European energy security and boost the Putin regime.

The German government, however, supports the project and refuses to block it.

Foreign Minister Heiko Maas describes it as a bridge that will keep Russia connected to the West and help constrain it. Speaking recently in the Bundestag, Germany’s parliament, Maas said that stopping the pipeline would drive Russia into economic isolation and a political and military alliance with China. “I’m against tearing down this bridge with Russia,” he said.

But Germany is divided over the issue. Many German politicians agree with the American view that the pipeline will pour extra cash into the coffers  of an odious regime.

Reinhard Bütikofer of the European Parliament: Nord Stream 2 is “wrong in so many ways.” (Courtesy European Union)

“How would we constrain them by handing Putin reliable revenue?” asked Reinhard Bütikofer, a German member of the European Parliament. “We would be fostering the aggressive policies of the Russian czar,” he said. Bütikofer, a member of the Green Party, also opposes the pipeline on environmental grounds. “This project will lock in additional fossil fuel infrastructure for the next 50 years, when we should be transitioning to nonfossil energy sources. This project is wrong in so many ways,” he said.    

Sascha Müller-Kraenner of DUH: “We should not strengthen Russia’s hand.” (Courtesy DUH)

Sascha Müller-Kraenner, head of the DUH environmental group, stated that if Nord Stream 2 were used to its full capacity, an additional 100 million tons of carbon dioxide per year would be released into Germany and Europe. “This is clearly very bad from a climate perspective,” he said. In addition to these environmental objections, Müller-Kraenner echoed U.S. concerns about the geopolitical implications of the pipeline. He agrees that it would enable Russia to shut down the main existing gas pipeline across Ukraine, depriving that country of billions of dollars in transit fees a year and making it even more vulnerable to Russian aggression.

“I think we should not strengthen Russia’s hand by giving them another access point to the European market. That could sideline Ukraine, which is an important partner of Germany,” Müller-Kraenner said.

Nord Stream 2 does have its supporters in Germany, who argue that the Berlin government is right to resist American pressure to abandon the pipeline. Michael Harms, head of a major association representing businesses involved in the import-export trade between Germany and Eastern Europe, said there is an overwhelming economic case for the project. “Nord Stream 2 will reduce gas prices in Europe,” he said. “It will increase the Continent’s energy security, and we need that. We need more gas as supplies from the North Sea will decline over the next few years.” 

Michael Harms of Ost-Ausschuss: “Nord Stream 2 will reduce gas prices in Europe.” (Courtesy OA)

Others say there’s a strong environmental case for the project too because Germany cannot yet depend on renewables for all its energy needs, and since natural gas emits much less carbon than oil and coal, it could aid the transition to a carbon-free future. Economist Gustav Horn said Germany has a particular need for an intermediate energy source because it has decided to close down the last of its nuclear power stations by next year.

“Since we are abandoning atomic power, we need some bridging energy supply, and that is gas. And therefore we need this gas from Russia,” he said. “We should stick with this deal with Russia.”

Gustav Horn, professor at the University of Duisburg-Essen: “We need this gas from Russia.” (Courtesy G. Horn)

Horn, a senior figure in the Social Democratic Party, which is part of the governing coalition, deplores the threat of further U.S. sanctions over the pipeline, especially since Germany is a close ally of the United States. He suspects that the U.S. isn’t driven solely by geopolitical concerns.

“The truth is that America has its own interest in this deal. And I think America wants to supply more of its own gas to Europe and especially to Germany because Germany is a big market for that,” he said.  

Agathe Demarais of the Economist Intelligence Unit: Germany sees U.S. pressure “as an infringement of its sovereignty.” (Courtesy A. Demarais)

The American sanctions seem unlikely to prevent Nord Stream 2 from being physically completed. Only 90 miles or so remains to be built, and the German government is shrugging off the American threat. “It’s about showing the U.S. that Germany is not going to cave in to this extraterritorial action,” said Agathe Demarais, director of forecasting at the Economist Intelligence Unit in London. “Germany sees this as an infringement of its sovereignty. Many people in Germany question how the U.S. would react if Europe were to sanction a pipeline that runs on American soil,” she said.

Nevertheless, Nord Stream 2 may never become fully operational. Gas may never flow through it. The sanctions could prevent it from being certified and insured, and Western companies may well be deterred from using it for fear of being excluded from the world’s U.S.-dominated payment system. In the end, German voters could seal the pipeline’s fate. The Green Party has vowed that if it helps to form the next coalition government after the fall election, it’ll block Nord Stream 2. And the Greens are riding very high in the polls.

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