Tough answer: EC will protect Nord Stream 2 from US sanctions

The Americans are introducing ever new sanctions for Nord Stream 2, but the European Union is determined. After a series of statements by German and European officials about the violation of sovereignty and Washington’s unheard-of audacity, concrete actions will follow.

Threats and intimidation

The United States is not abandoning its efforts to prevent Russia from completing a pipeline in the Baltic Sea. New measures have been approved in Congress.

“Get out now,” Secretary of State Mike Pompeo advised foreign participants in the project. The restrictions will also affect the Turkish Stream. And those who disobey face “serious troubles.”

In accordance with the updated law “On Countering US Adversaries Through Sanctions” (CAATSA), Washington may freeze American assets of participants in Nord Stream 2.

At the end of June, the Eastern Committee of the German Economy (OAOEV), which unites the countries of Central, Eastern, and South-Eastern Europe, proposed to introduce counter-restrictions. The head of OAOEV Michael Harms noted that this will significantly affect the interests of Washington in Europe.



“Tough diplomatic statements or compensation for German companies are possible. We reserve the right to defend ourselves,” Harms said.

In late July, the US Senate extended sanctions to the insurance companies involved in the project.

And in early August, senators sent a letter to the operator of the German port of Sassnitz, urging them to stop working on the gas pipeline. Otherwise, the Americans threatened, the port of Sassnitz will face a “financial collapse”.

Tug of war

This was the last straw. German business demanded decisive action from the European authorities. “Wordless statements lead nowhere. The federal government and the European Commission are obliged to protect German and European companies from similar attacks from third countries.

Targeted countermeasures are needed, “OAOEV stressed.

According to the Süddeutsche Zeitung, the final construction phase of Nord Stream 2 is like a tug of war between the United States and Germany. At the end of last year, Washington had already passed a defense budget that would include restrictions on companies involved in laying the pipeline.

Then the Swiss firm Allseas stopped all work. However, Russia decided to complete the project on its own, sending the Akademik Chersky and Fortuna ships to Mukran. Now the American authorities are “targeting precisely these vessels,” the Süddeutsche Zeitung points out.

But, as the newspaper reminds, the port does not belong to a private person: 90 percent of Mukran is owned by the city of Sassnitz, and another ten – by the land of Mecklenburg-Western Pomerania. Therefore, the Ministry of Economy of the Federal Republic of Germany regarded these threats as “unsurpassed audacity”, and some experts even spoke of “declaring an economic war.”

In early August, it became clear: a single position of the EU has been formed, Washington will receive a coordinated rebuff.



“The European Commission is working on a Communiqué on Measures to Strengthen the EU’s Financial and Economic Sovereignty” to lay the foundation for a sanctions mechanism that will also increase resilience to extraterritorial actions by third countries, “said EU Ambassador to Russia Markus Ederer.
EU High Representative Josep Borrell called the US sanctions against Nord Stream 2 contrary to international law.

It is high time

State Duma Deputy Vladimir Gutenev noted that the European Union should have long ago created a mechanism to counter the extraterritorial sanctions of third countries. According to the parliamentarian, European officials delayed this decision because of fears for their own careers.

The Americans oppose the project, as they seek to impose their own liquefied natural gas on the Europeans. However, Nord Stream 2 is supported by Germany and Austria interested in reliable fuel supplies.

And the Norwegian government owns 30 percent of the shares of Kvaerner, one of the construction contractors.
So far, everything is limited to statements, but, most likely, the European Union understands economic sanctions against the United States by the mechanism of counteraction. And there are many options.

“Europe can impose an embargo on American products, the same LNG, or duties on cars, which will hurt the US auto industry, which is experiencing a strong recession. Or a ban on agricultural imports such as corn,” said Leonid Khazanov, an independent industry expert.

The analyst stressed that sanctions will be announced before the US elections, possibly even in the next two weeks, if Trump, Congress and the Senate continue to exert political pressure on Europe.