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FILE PHOTO: The logo of the Nord Stream 2 gas pipeline project is seen on a pipe at Chelyabinsk pipe rolling plant owned by ChelPipe Group in Chelyabinsk, Russia, February 26, 2020.  REUTERS/Maxim Shemetov/File Photo
Report

Nord Stream 2: Background, objections, and possible outcomes

Executive Summary

Nord Stream 2 is an almost-finished natural gas pipeline from Russia to Germany. The Biden administration opposes it and has come under congressional pressure to invoke sanctions to prevent its completion, in large part because the pipeline seems a geopolitical project targeted at Ukraine. The German government, however, regards the pipeline as a “commercial project” and appears committed to its completion, perhaps in the next few months. U.S. sanctions applied on Russian entities to date have failed to stop Nord Stream 2, raising the question of whether the U.S. government would sanction German and other European companies for servicing or certifying the pipeline. Such sanctions would provoke controversy with Germany at a time when both Berlin and the Biden administration seek to rebuild good relations. The two sides have work to do if they wish to avoid Nord Stream 2 becoming a major point of U.S.-German contention.

Acknowledgments:

The author is grateful to Ed Chow, Dan Fried, and Constanze Stelzenmüller for reviewing and commenting on drafts of this paper. He, of course, is responsible for the final content. The author is also grateful to Ted Reinert, who edited this paper with assistance from Lucy Seavey, and to Rachel Slattery, who provided the layout.

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