The decision by U. S. President Joe Biden on May 19 to waive key sanctions on Russia’s Nord Stream 2 pipeline in the Baltic Sea has triggered bipartisan protests, as well as dismay from Ukraine and the nation’s friends and allies around the world.
“I have determined that it is in the national interest of the United States to waive the application of sanctions on Nord Stream 2 AG, its CEO Matthias Warnig, and Nord Stream 2 AG’s corporate officers,” U. S. Secretary of State Anthony Blinken said in a statement on May 20. Blinken added that the action was “consistent with the president’s pledge to rebuild relationships with our allies and partners in Europe.”
The secretary of state claimed, however, that the U.S. would “continue to oppose the completion of this project, which would weaken European energy security and that of Ukraine and Eastern flank NATO and European Union countries.”
However, given that the main Swiss-registered company involved in the project and its CEO have escaped U.S. sanctions, the completion of the pipeline seems a certainty this year, absent an abrupt reversal by the Biden administration.
The decision is a victory for Russia and Germany, which lobbied the U.S. to not sanction the pipeline. But much of Europe, aside from Poland and the Baltic states, has not joined in the sanctions push to stop Nord Stream 2.
Defying Congress
Congress passed legislation in January requiring sanctions on the Nord Stream 2 pipeline, which links Russia and Germany through the Baltic Sea and whose construction is currently 95% complete. The $11.6 billion, 1,230-kilometer pipeline bypasses Russia’s main natural gas transit route in Ukraine, doubling existing Russia to Germany transit capacity to 110 billion cubic meters annually.
While Biden imposed sanctions against eight Russian entities involved in the project, the pipeline is likely to be completed soon without broader sanctions. The lifting of the sanctions came at an odd time. Russia is massing troops near the Ukrainian borders. Russian hackers disabled a major U.S. gasoline pipeline. Evidence shows that Russian intelligence officers poisoned Kremlin opposition leader Alexei Navalny, blew up weapons depots in the Czech Republic and killed a weapons dealer in Bulgaria. Many nations have consequently expelled Russian diplomats in protest.
Warnig’s background
One of those who escaped sanctions, Warnig, is a former officer of the Stasi, East Germany’s secret police. He is a long-time associate of Russian dictator Vladimir Putin. Warnig says he first met Putin in 1991. However, the Wall Street Journal reported that their first meeting took place in Dresden in 1989, when Putin was a KGB operative there.
The two men allegedly collaborated on recruiting West German citizens for the KGB. Warnig also spied on Germany’s Dresdner Bank before he started working for it in 1991, according to intelligence documents cited by the Wall Street Journal.
In 2002–2005, Warnig was the head of Dresdner Bank’s Russian branch. At that time, the branch advised the Russian government on the unlawful seizure of the assets of Putin’s jailed political competitor Mikhail Khodorkovsky.
Cotton’s response
Strong criticism to Biden’s actions came from several members of Congress, including Tom Cotton, the Republican senator from Arkansas. “This refusal to implement sanctions approved by Congress directly benefits — by design — the Russian company building Nord Steam 2 and its CEO, who, you won’t believe it, is a former Communist East German Stasi officer and longtime crony of Vladimir Putin,” Cotton said. “President Biden’s decision to cave on Nord Stream 2 is just the latest show of weakness toward Russia by this administration.”
Cotton argued that Nord Stream 2 would “serve as a noose around the neck of Europe’s energy supply.”
“It will allow Russia to squeeze the sovereign nations of eastern and central Europe into submission,” he continued. “You may think I’m exaggerating, but Russia has used energy as a weapon of foreign policy many times in the past.”
In 2006 and again in 2009, Russia halted natural gas supplies to Europe amid disputes with Ukraine.
“All of Europe could suffer, but Ukraine would be hurt most of all,” Cotton said. “This would not only cost Ukraine’s economy billions of dollars in transit fees, but it would also give Russia the ability to isolate and starve this proud nation. It’s hard to imagine a worse time for this to happen, with Russian troops massed on the Ukrainian border while Russia’s dictator salivates over conquering or further partitioning this country.”
He also argued that Biden’s “actions are directly empowering a dictator who poses the greatest threat to their dreams — a man who rose to power and has maintained it through extortion, murder, and brutality.”
“Putin’s most recent political rival, Alexei Navalny, was poisoned with a nerve agent and today is rotting in a Russian penal colony,” Cotton said. “Navalny’s only crime was exposing the corruption and depravity of the Russian state. Yet, President Biden wants to enrich and reward this very regime.”
Other responses
Democrat Bob Menendez, chairman of the Senate Foreign Relations Committee, also opposed the waiving of the sanctions.
“I am opposed to the decision by the Biden Administration to waive sanctions on NS2 AG and Matthias Warnig,” he said. “I urge the administration to rip off the Band-Aid, lift these waivers and move forward with the congressionally mandated sanctions. The administration has said that the pipeline is a bad idea and that it is a Russian malign influence project. I share that sentiment, but fail to see how today’s decision will advance U.S. efforts to counter Russian aggression in Europe.”
“This decision has created uncertainty in many corners of Europe and I expect to hear very soon from the administration on its plans moving forward,” he continued. “I believe President Biden should do everything possible to accomplish what the Trump administration failed to do for four years: stop the completion of the Nord Stream 2 pipeline for good.”
Republican Senator Ben Sasse, a member of the Senate Select Committee on Intelligence, also condemned the decision on Nord Stream 2.
“Two months ago, President Biden called Putin a ‘killer,’ but today he’s planning to give Putin, his regime, and his cronies massive strategic leverage in Europe,” he said. “You can’t pretend to be a Russia hawk but then just roll over. It’s wrong to roll back a tool that hurts the completion of a core Putin pet project to weaken NATO. Allowing the completion of the Nord Stream 2 pipeline would be a strategic mistake and the administration should rethink this.”
Biden’s move was also criticized by the Ukrainian Congress Committee of America and Democratic Senator Jeanne Shaheen.
Previous actions
Gazprom started building Nord Stream 2 in 2018. However, it had to halt the construction in 2019, when Congress introduced the first batch of sanctions against the pipeline. In late 2020, Russia resumed the project but Congress then passed the second batch of sanctions, which applied to companies that provide insurance, testing, inspection, and certification services for the pipeline.
In February the U. S. State Department sent a report to Congress, detailing its latest sanctions on companies involved in the pipeline, but failing to deliver the punitive measures expected by Congress. The report didn’t name any new companies as targets for sanctions.
It also did not mention any German or other European entities involved in the project, allowing work to continue on the pipeline.
“This Russian pipeline is bad for America and bad for Europe,” Cotton said. “If the president wishes to take the reins of international leadership, this is his opportunity. Kill Nord Stream 2 now, and let it rust beneath the waves of the Baltic.”
