US prepares new sanctions against Nord Stream 2 / News / News agency Inforos
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US prepares new sanctions against Nord Stream 2

The White House has also announced the upcoming activation of the instructive leverage on the Russian oil sector

US prepares new sanctions against Nord Stream 2

In late January, the Russian side announced the completion algorithm for Nord Stream 2: the pipeline will be finished by domestic pipe-laying companies. This came from Deputy Chairman of the Gazprom Board Yelena Burmistrova during the European Gas Conference in Vienna.

In fact, Russia is well positioned to complete the gas pipeline. However, special ships (for offshore piping works) still need to be retrofitted and sent to the Baltic waters. These procedures will take some time. But Gazprom has a time lag of over a year, with Vladimir Putin having publicly stated in mid-January that the new commissioning benchmark is the first quarter of 2021. Later, on January 31, the same deadline for launching Nord Stream 2 was publicly recalled by the German Ambassador to Russia Géza Andreas von Geyr. So construction activities will be completed anyway.

What is different about it is that the project's foreign investors appear distinctly excited. The gas pipeline's payback period is being shifted, with an increase in contracted loan servicing expected. Thus, leaders of European energy companies Shell and OMV have lambasted US sanctions against Nord Stream 2. Moreover, the OMV head called for European Union's proactive attitude in supporting Nord Stream 2. Brussels' passivity is attributable to the fact that in general, the region's energy security with a successful late 2019 solution to the issue of maintaining Ukrainian transit has reached an acceptable level – pumping sufficient volumes of Russian gas on this direction will be preserved for at least five years.

But the US authorities double down on efforts to obstruct the Nord Stream 2 project. They are obviously really annoyed by news on its high readiness and completion inevitability. On February 4, another package of US sanctions against Nord Stream 2 was announced. As reported by the German Handelsblatt business newspaper citing American diplomatic sources, if Russia attempts to complete the gas pipeline, restrictions may affect European companies. Even if Russia does this single-handedly.

According to Handelsblatt, new sanctions may threaten European investors engaged in the project, as well as companies that will buy gas supplied via Nord Stream 2. Moreover, the relevant law may be revealed as early as in February or March.

Sanctions to this effect will be an explicit challenge to Europe. This story should finally prompt the European Union to actively defend the rights of European energy Nord Stream 2 investor companies. The United States' impeding the completion and future operation of the new gas pipeline is a blatant attempt on the energy security of Old World countries. In fact, we are talking about a direct ban on buying gas from a producer who has been supplying gas to Germany for 50 years (February 1, 2020 marked the 50th anniversary of the legendary "Gas-Pipe" deal of the century between the USSR and Germany. Over one trillion cubic meters of natural gas have been delivered to Germany over half a century).

Besides, the Americans are preparing obstacles to the development of Russia's international projects in the oil sector. So, US Special Representative for Venezuela Elliot Abrams told reporters that Washington is considering sanctions against Rosneft. The announcement says that in the next 30 days, the US intends to take new "quite painful" measures against the Venezuelan government. In particular, Rosneft may become subject to new sanctions. The company, according to the Americans, conducts dealings with the sanctioned Venezuelan state-owned PDVSA company.

Against this, the following statistics looks contrast-enhanced: it is due to the replacement of Venezuela's oil exports that October 2019 saw Russia move to the rank two (after Mexico) as a supplier of oil and petroleum products to the United States. There is an essentially schizophrenic situation when the White House openly combats the Russian oil and gas business, while the latter increases the export of hydrocarbon raw materials to the United States.

There are also "top-ranking" Russian-American rounds of consultations: on February 6, Russian Energy Minister Alexander Novak met with US Ambassador to Russia John Sullivan to discuss the current state of bilateral cooperation in the energy sector. Sullivan also held talks with Chairman of the Audit Chamber of the Russian Federation Alexey Kudrin, after which they called for reducing sanctions in the future. But so far, the zeal of Russian diplomacy to actually contain US sanctions against the Russian oil and gas sector has come to naught. However, it is still important that the energy dialogue between Russia and the United States is not suspended.

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