President Donald Trump has signed into law sanctions against companies working with Russian state-owned oil company Gazprom in its project to complete a pipeline into the European Union.
In particular, the sanctions are focused on hitting Nord Stream 2, an underwater gas pipeline stretching from Russia to Germany via the Baltic Sea. The project’s price tag has come out to almost $11 billion.
In the U.S., the gas pipeline has caused considerable anger for various reasons. The ostensible reason given by the White House, as well as both Republicans and Democrats in Congress, is that it strengthens Russia’s grip over European gas supply. Trump has even gone so far as to claim that Germany could be turned into a “hostage of Russia.”
A more likely underlying reason is that Gazprom will create even greater competition in the European market of liquified natural gas.
The issue of Nord Stream 2 is not a new one and has been repeatedly brought up by the U.S. with Germany being a particular target of American ire.
Officials on the other side of the Atlantic were quick to denounce the sanctions. German Finance Minister Olaf Scholz described them as an infringement of sovereignty, while Foreign Minister Heiko Maas stated that they are an “interference in autonomous decisions taken in Europe.” A few days earlier, Merkel made clear her opposition to “extraterritorial sanctions.”
That position was reiterated by a spokesman for the European Union who said that “As a matter of principle, the EU opposes the imposition of sanctions against EU companies conducting legitimate business.”
Unsurprisingly, Russia, already facing economic measures by the U.S., likewise decried the sanctions. The country, which already provides 40% of the EU’s gas supplies, described the move as an attempt by the United States to hinder global competition.
The sanctions also impact TurkStream, a joint Russian-Turkish pipeline. Measures also include the cancellation of American visas for contractors involved in the project as well as the freezing of assets.
Nord Stream 2 has also faced significant opposition within Europe. The two primary reasons are concerns over continued reliance on Russian gas and environmental worries. In particular, Poland has repeatedly been critical of the project. Earlier this year, the bloc almost blocked the project until a compromise emerged in which the pipeline would face greater regulations. At the same time, the EU is seeking to diversify its energy sources, such as through a Norway-Poland pipeline.
Activists see the pipeline as simply contributing to the growth of carbon emissions and the exacerbation of climate change. Back in May, climate activists occupied parts of Nord Stream 2 in Germany. They have been calling for a transition towards renewable energy instead.