It was my pleasure to be with Thierry Bros of Sciences Po University, Paris, and Peter Zalmayev, Ukrainian security analyst and executive director of Eurasian Democracy Initative on David Foster’s Roundtable on TRT World, London, broadcast 9 June 2021.
I discussed Biden’s apparent reasoning for waiving Nord Stream 2 sanctions:
First off, the German government of Angela Merkel simply would not cooperate otherwise. Allowing her pet energy project to go forward was the price she had demanded for trans-Atlantic “unity” before Biden’s summit with Putin.
(Aside: My research in Berlin and elsewhere has convinced me that, at no point from the late-Trump administration through Biden’s six months in office, did the German side actually engage in any meaningful “negotiation” or discussions with the US side to seek to find some compromise or to initiate a moratorium on construction. Not until Biden waived sanctions on Nord Stream 2 AG, and decided not to sanction any German firms inolved in construction did Merkel show any real interest in discussions. She emphasized her change of attitude on negotiating with Biden about: “what now are also the necessary commonalities in the relationship with Russia” in comments during a German national broadcast interview immediately following Biden’s sanctions waiver. Until this waiver, she had held up any real discussion of the pressing issues of trans-Atlantic unity-in-general, whcih urgently needed attention.
Here are four issues on the Biden-Blinkin sanctions decision I discussed with EuroNews and other news media in the last few days:
-1- Regarding Biden’s waiving of sanctions on the company Nord Stream 2 AG and its head Matthias Warnig (former Stazi officer):
These sanctions would be unlikely to stop NS2, though it would cause difficulty for the firm and the European oil and gas firms that are partnering with it.
I am not surprised, however, in light of the upcoming Biden-Putin summit. It should be noted that the Russian side (e.g., their ambassador here in Berlin) has made clear, publicly, that sanctions would kill the Biden-Putin summit — which both sides need on many hot issues (see my comments of yesterday, on Iran negotiations, and US necessity to withdraw on-the-ground forces from the Middle East, and to focus on “Great Power Competition” vs. especially China, and Russia).
-2- As for effect of the new sanctions on the pipeline’s construction, and what options the US has:
I was very happy to be interviewed for the Latin American “Energy Analytics Institute” (EAI), a Houston-based consultancy and news service. I’ve followed its work for years.
With Biden in and Trump out, everyone is debating how to deal with Maduro and his chavista regime that’s brought such misery and ruin in Venezuela. It’s not only the USA’s new LatAm team of Biden, Blinken and Nichols, but the EU, Norway, the OAS, the Lima Group, who are all looking for a new strategy. And so has the Venezuelan opposition, plus an increasingly important actor: the growing and doggedly persistent civil society organizations. Increasingly suffering forced-isolation from abroad, this array of social, cultural, media, medical, educational, nutrition, economic and political resistance groups do largely self-sufficient work to replace basic necessities and social-services, which the chavista government and ruined private sector can no longer provide.
However, in this brief Q&A what was addressed was not strategy per se; but a key underlying issue to understand in framing a strategy: the interests of both Moscow and Beijing as key obstacles to removal of the chavista regime. Read at EAI site (free) or Read below – Tom O’D.
China, Russia, Venezuela: Q&A With Thomas O’Donnell
(Energy Analytics Institute, 13.Feb.2021) — China and Russia continue to push around their might in Venezuela. Thomas O’Donnell with the Hertie School of Governance & Freie Universität-Berlin weighs in briefly here.
Energy Analytics Institute: What might China and Russia be willing to do this year to assist Venezuela’s President Nicolas Maduro?
Thomas O’Donnell, PhD: Beijing’s original (and perhaps still) plan for Venezuela was deep vertical integration mirroring PDVSA-Citgo Petroleum: new Faja upgraders, a pipeline to Colombia’s Pacific coast, dedicated ships, dedicated domestic Chinese refineries, etc. All very rational and lucrative for both sides. China became alarmed with Hugo Chavez’ unreliability and incompetence within a few years and with Maduro’s incapacity to reform within a year or so. The entire “oil-for-loans” history was a fallback strategy for Beijing – at least secure an oil stream with minimized risk. I have no doubt the Chinese Communist Party wants a new Caracas regime it can work with.
This 10 February half-hour roundtable on TRT Television, London looked at the possibility of Nord Stream 2 being stopped by US sanctions. My thanks to host David Foster for the invite.
Today is 20 February, and I should add that since this was recorded, the Biden-Harris-Blinken administration has surprised Congress by sanctioning significantly fewer ships than it expected to be sanctioned for assisting Gazprom to lay pipe in Danish and German waters.
This White House attempt to generate goodwill with Berlin and with Merkel’s ruling coalition is generating bipartisan objections in Congress. Upcoming posts will analyze this development . Tom O’D. Below is the text from TRT network’s promotion of the show. and guests’ names and affiliations.
In this live interview with Deutsche Welle (DW.de) on 12 February, I told host Christoph Kober, that this pipeline is clearly “geopolitical”.
Without Nord Stream 2, Putin can’t significantly escalate his war inside Ukraine; he’d risk his lucrative gas-export business with EU. That’s because, without Nord Stream 2, most of the gas Russia exports to EU countries currently has to arrive via pipelines transiting Ukraine that belong to its finance ministry (the remainder Russia pipes to EU states arrives via Belarus-Poland).
I pointed out that, by invading Ukraine in 2014, Putin created his own worries about his lucrative gas business with the EU. Unfortunately for Ukraine, Germany’s government also frets about this gas, fully 40% of all EU imports, having to pass through Ukraine. And so, Berlin made a “realpolitik” decision in 2015, to assist Russia’s Gazprom to build a huge new a detour pipeline around Ukraine. (I analyzed this policy, in 2017, as a “Neue Neue Ost Politik” and here – i.e., the New New Eastern Politics, a third historical iteration of German elites’ reorientations towards Moscow.)
These two interviews critique the new “environmental foundation” founded by a local German state, and paid for 99% by Russia’s Gazrpom, as a self-described “clever loophole” to circumvent US sanctions. The publicly admitted scheme is to have the foundation purchase materials and equipment from the specialty companies able to supply them, and have the foundation later supply these materials directly to Gazprom, enabling Gazprom to finish building the pipeline beneath the Baltic Sea. The foundation” is telling firms this will protect them from being sanctioned for selling directly to Gazprom. However, the US sanctions specifically target “circumvention” of sanctions, and I explain that German firms are ill-advised or naïve to cooperate, risking ruinous sanctions.
The permit from Denmark has been received and new pipes for Nord Stream 2 could soon be laid. However, it is more questionable than ever whether the American sanctions threats can be circumvented.
The completion of Nord Stream 2 remains uncertain. 94 percent of the Baltic Sea gas pipeline has been laid, but the last few meters are still stuck. After the departure of the Dutch-Swiss laying vessels in December 2019, progress was only brief when 2.6 kilometers were erected a few weeks ago . It was not a breakthrough: the pipeline consists of two parallel strands with a total length of around 2,460 kilometers. 30 kilometers are still missing in German, 120 kilometers in Danish waters.
Theoretically, things could continue this week on Friday for the construction consortium Nord Stream 2 AG, a subsidiary of the Russian state group Gazprom. From January 15th it has a permit from the Danish Maritime Administration, and the Russian ship Fortuna is authorized for the work. But according to reports, only preliminary work is planned.
[This post is a dey late due to the violent attack on the US Capitol orchestrated by the outgoing-president and his followers. This assault has been defeated and the election is being certified by Congress. Trump will soon leave and Biden will take office in accordance with the Constitution and laws. T. O’D.]
The EuroNews Morning Show asked me [yesterday 6 January,] again about the Nord Stream 2 pipeline. Two key points made in the earlier interviews were:
That the plans of Nord Stream 2 AG (NS2 AG) to restart pipelaying before the holidays in German waters was a propaganda exercise (viz, “a disinformation campaign”) orchestrated by Moscow and Gazprom to create the impression the pipeline can be finished.
Despite this new pipelaying “bravado”, the pipeline was effectively “dead” because of the US sanctions.
These points were an assessment of the impact of the new sanctions law, which was about to be enacted by the US Congress. This is the “Clarifications” of the Protecting Europe’s Energy Security Act, or PEESCA, which was enacted December 2021, despite a veto by President Trump. These PEESCA sanctions have been added to the previous PEESCA (December 2002) sanctions and the Countering America’s Adversaries Through Sanctions Act (CAATSA, initially 2017) sanctions against NS2.
Host Rosie Wright, of EuroNews Morning Show interviewed me today. I explain how Nord Stream 2 AG’s plan to lay 2.6 kilometers of pipe in shallow German waters actually shows that US sanctions have effectively killed this German-Russian mega natural gas project designed to help both countries avoid shipping/receiving gas that transits Ukraine (mostly), Belarus and Poland.
The pipeline is not bringing “new” gas to Europe, but is designed to end Gazprom’s (the Russian-state gas export monopoly) having to ship its gas exported to Europe across regions which Putin’s regime wants to subvert and pressure (including by military means) back into the Russian orbit. Ukraine and Belarus.
Berlin for its part, does not want to risk the EU’s gas supply by standing up to Moscow’s subversion against Ukraine and Belarus. The USA (i.e., Congress, on a bipartisan basis, and not Trump) has imposed harsh sanctions that are succeeding in stopping completion of the project. The Biden administration will not alter this reality; Biden has opposed this project and always championed the cause of Ukraine reform and independence from Russian dominance, in favor of moving towards the EU.
Note: EuroNews is the most watched news in Europe, reaching 135 million viewers/month. — Comments and critiques most welcomed, either below, or privately to twod-at-umich.edu. — Best, Tom O’D.
My analysis of the US-German crisis over Nord Stream 2 and policy towards Russia, published in Washington by the American Institute for Contemporary German Studies (AICGS), 8 October 2020. Read it at AICGS website\. Or, continue here. Comments & Critiques welcomed (below or via email)
Nord Stream 2: Allies’ Crisis
Two decades of Washington-Berlin collisions over the Nord Stream 1 and now the Nord Stream 2 pipelines have come to crisis.
The U.S. Congress stopped Nord Stream 2 construction in December 2019 by enacting sanctions under the Protecting Europe’s Energy Security Act (PEESA), and is poised to enact a much harsher “Clarification” of PEESA, sanctioning any entity that resumes or aids in resuming construction in the Baltic Sea. German officials insist the project will, nonetheless, be completed, denouncing U.S. sanctions as “extraterritorial” interference in “European sovereignty.”
In reality, the project appears dead. Statements by businesses interests, as opposed to political actors, support this. To resume construction, companies, ports, officials, and insurers would require guarantees against ruin, including being personally sanctioned, which is difficult to imagine the German state providing. And there is no evidence of preparations to do so. Nevertheless, Russia’s Gazprom continues preparations to resume work.
Complicating matters, the U.S. Congress, having mandated sanctions against the pipeline, would have to approve any compromise. On the other side, the German Bundestag roundly “savaged” a motion by the Green Party to abandon Nord Stream 2 in response to Navalny’s poisoning, unprecedentedly uniting the CDU/CSU of Chancellor Merkel and her SPD coalition partners with both the far-left Die Linke and far-right Alternative for Deutschland.