Nord Stream 2, which will carry gas to Germany and central Europe, is being built by a company owned by Kremlin-controlled gas company Gazprom, but half the funding has been provided by five European energy companies: Shell, Uniper, OMV, Wintershall and Engie. “It’s a clear warning to companies that aiding and abetting Russia’s malign influence projects will not be tolerated,” Mike Pompeo, the US secretary of state, said on Wednesday. “Get out now, or risk of the consequences.”
The issue has soured relations between Berlin and Washington, as Germany accuses the US of interfering with its energy policy. But the Trump administration, with strong bipartisan backing in Congress, argues that punitive actions are needed to push back against Russia. Congress two years ago passed the Countering America’s Adversaries Through Sanctions Act (Caatsa), to try to stop Russia from completing the pipeline. At the time, the state department said loans and investments made before that date would be exempt from sanctions. On Wednesday, however, Mr Pompeo said the Trump administration was removing those protections.
“Let me be clear, these aren’t commercial projects,” he said. “Theyare the Kremlin’s key tools to exploit this bad European dependence on Russian energy supplies, tools that undermine Ukraine by cutting off gas transiting that critical democracy, a tool that ultimately undermines transatlantic security.” The move also comes as Congress prepares to debate an annual defence bill that includes further measures to try to derail the gas pipeline.
Ted Cruz, the Republican Texas senator who has been one of the drivers of the effort, said the state department move “again confirms that there is a unified bipartisan, bicameral, inter-branch consensus across the whole of the US government to ensure Putin’s pipeline never comes online”. Mr Cruz said Congress was also proceeding with a measure to expand the possible range of sanctions related to the Nord Stream project.
Moscow said the US threat was an effort to use political pressure against Russian business interests. Russia has previously vowed to retaliate against any new US sanctions and Gazprom has vowed to complete construction of Nord Stream 2 by itself if Washington forces all its partners to abandon the project.
“This is the use of political pressure for the purpose of unfair competition, an indicator of the American system’s weakness,” said Maria Zakharova, a Russian foreign minister spokesperson.
Moscow has consistently said the pipelines are commercial projects and that the US is seeking to stop their construction to promote its own liquid natural gas exports to European countries as an alternative supply.