Page 4 - FSUOGM Week 30 2021

FSUOGM COMMENTARY FSUOGM

Path clear for Nord Stream 2

after German-US deal

Germany and the US have promised sanction against Russia if it uses energy as a weapon

RUSSIA THE path is now clear for Russia’s Nord Stream And the economic gains Germany stands to
2 gas pipeline project to go ahead, following a make are substantial. Nord Stream 2 will supply
WHAT: landmark agreement between Germany and the cheap gas to support its burgeoning automobile,
Panel no indent US. chemicals and electrical equipment industries. It
Panel indent The US has vehemently opposed Nord will also gain valuable revenues from transiting
Stream 2 that will carry Siberian gas under the the pipeline’s gas to its neighbours.
WHY: Baltic Sea to Germany, both on political and Both Germany and the US have expressed
Panel no indent commercial grounds. On the one hand, it fears to desire to maintain Russian gas transits via
Panel indent that the pipeline will bind Germany and Rus- Ukraine, however. Moscow conceived Nord
sia in a closer relationship, undermine Europe Stream 2 as a means of diverting this gas away
WHAT NEXT: energy security and give Moscow greater polit- from the Ukrainian system. Not only would
Panel no indent ical leverage in the continent; on the other, as Kyiv lose billions of dollars in transit revenues
Panel indent Russia has often pointed out, the US fears that if this were to happen, but it would increase
the pipeline will allow Russia to occupy space in the likelihood of Russian military invasion of
the European gas market that could be taken up Ukraine, as Russia would no longer have to
by US LNG. Yet despite aggressive US lobbying rely on its neighbour to supply its European
over the years, Germany has remained a staunch gas customers.
supporter of the project, despite its turbulent With diplomacy failing, US resorted to sanc-
political relationship with Russia. As German tions in an attempt to derail Nord Stream 2. It
Chancellor Angela Merkel has often stressed, imposed its first punitive measures against the
Berlin views Nord Stream 2 as an economic pro- project in December 2019, which forced Swiss
ject and nothing more. contractor Allseas to abandon its work on the

P4 www. NEWSBASE .com Week 30 28•July•2021