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As the Russia-backed Nord Stream 2 natural-gas pipeline nears completion, likely by next month, the U.S. and Germany have struck a deal that would resolve their years-long dispute over the project, according to the Wall Street Journal.
A draft proposal under consideration by Washington and Berlin, which was obtained by Bloomberg, would commit Germany to retaliating against future Kremlin efforts to weaponize energy flows against Ukraine. According to the proposal, in such a situation, Germany would potentially respond by cutting off gas flows from Russia.
But the agreement will face major opposition, including from bipartisan critics in Congress and U.S. allies who might vocally object to it. These two groups view Nord Stream 2 as a malign, authoritarian influence project that would put frontline states at the mercy of Russian gas flows and increase Europe’s dependence on Moscow.
Curiously, the Biden administration sees it this way, too, but still takes a stance deferent to Chancellor Angela Merkel’s fierce advocacy for it and opposition to U.S. sanctions that would target European companies and individuals involved in its construction. Responding to the reports on a potential agreement during a press briefing this afternoon, State Department spokesman Ned Price reiterated that criticism: “We have made no bones about the fact that it is a bad deal for Germany. It is a bad deal for Ukraine and for Europe more broadly.”
Ukraine stands to lose some of the revenue it makes from transit fees from the gas pipelines that currently run through its territory. The country’s leaders also worry that the completion of Nord Stream 2, which bypasses Ukraine, would detract from some of the leverage it needs to deal with the ongoing Russian military threat.
Still, the administration has consistently deferred to German sensitivities, if not rhetorically, then in practice. In May, it waived sanctions on the project’s German CEO Matthias Warnig and the corporate entity that he heads, and Price struck a defensive tone during his comments today. “It’s also worth a reminder of what this administration inherited and that it is a pipeline that was over 90 percent complete when we assumed office,” he said, reflecting the administration’s view that the pipeline’s completion is all but given.
But this was not always a given. Secretary of State Antony Blinken lost the intra-administration debate over the sanctions waivers to National Security Council officials who didn’t see stopping Nord Stream 2 as a worthy enough goal to damage U.S.–German ties. At one point, at least, senior State Department officials apparently viewed it as possible, or worthwhile, to attempt to stop the pipeline from being built.
But now, by mending fences with Germany’s outgoing government with a potential deal, compromising on U.S. opposition to Nord Stream 2, President Biden and his team might be creating problems elsewhere.
In recent months, top officials from those countries, including Ukrainian president Volodymyr Zelensky and Polish foreign minister Zbigniew Rau, publicly complained that the Biden administration hadn’t looped them in on key sanctions decisions.
