Joe Biden, who is set to take up the top post in the United States, now has the opportunity to knock his Russian counterpart, Vladimir Putin, on the ground in the very first days of his time in office.
To this end, he won’t need a tatami ring against Russia's "most famous judoka." All he has to do is to sign off the National Defense Appropriations Act 2021 early next year, which, among other things, lays down new sanctions against insurance and certification companies who dare take part in the implementation of the Nord Stream 2 gas pipeline project aimed to deliver gas from Russia to Germany via the Baltic Sea.
As the German newspaper Bild notes, Biden is determined to go for it in order to deliver a deadly blow to Russia's politicized energy project, which has already cost Moscow tens of billions of dollars.
It should be noted that Russia had initially planned to complete Nord Stream 2 at the end of 2019. However, for twelve months already, no works have been carried out on the pipe that's just miles short from being completed.
This was facilitated by the U.S. sanctions introduced in December 2019 against pipe-laying vessels involved in the project. Ukraine also played an important role to this end, as its representatives had been tirelessly convincing congressmen in Washington of the need to step up measures to stop the construction of the notorious pipe.
However, the risk remains that construction resumes and ultimately completes. To prevent this from happening, the United States intends to expand and strengthen sanctions. In Washington, there is bipartisan agreement on upping restrictions, while Joe Biden seems to also be all in on the issue.
For Ukraine, Nord Stream 2 is an existential challenge, another front on which Kyiv confronts Putin's Russia
For Ukraine, Nord Stream 2 is an existential challenge, another front on which Kyiv confronts Putin's Russia, which has long been seeking to get the neighboring country back in own sphere of influence. If this pipeline is completed, gas transit from Russia to the EU via Ukraine will stop.
This will lead to Ukraine losing several billion dollars in annual revenues and the country's significant place on Europe's energy map.
What's the U.S. interest here – besides their sincere will, which no one doubts, to help its European ally opposing Russia's aggression?
First, the very idea that Germany and Russia would merge into an energy alliance has for many years been bugging decision makers across the Atlantic.
Indeed, if the project were implemented, Germany would be able to practically monopolize most of the Russian gas on the European continent, which will strengthen Germany's dominance over other European countries.
In turn, Vladimir Putin, having hooked Germany on this gas needle, will have the opportunity to increase his influence on the policy of this country – the largest EU economy.
The project's implementation would strengthen Russia's position in the EU gas market, which directly contradicts the U.S. interests. For several years, Washington has been trying to gain a significant share in this market by increasing LNG supplies, not least by squeezing Russia out of this market.
Therefore, consistent U.S. action to counter Nord Stream 2 looks logical and will most likely bring the project to a full halt.
At the same time, the United States is not the only force that could in the near future remove Russia from Europe's energy map or, at least, significantly curb its influence on the continent.
Coronacrisis, which led to a record drop in natural gas prices in Europe and a significant decline in demand, also plays against Russia. In the first nine months of 2020, the Russian gas monopoly Gazprom reported a loss of RUB 592 billion ($7.6 billion), while for the same period last year the company's profit amounted to RUB 434.9 billion.
If quarantine restrictions caused by the pandemic drag on, no recovery should be expected in demand in the coming years, which means that the Kremlin's "gas baton" Gazprom will face troubled times, as will Russia, which is significantly dependent on revenues from exports of raw materials.
Time is not on Russia's side either. Europe is switching to renewable energy sources, investing billions in developing hydrogen technology, which in the future will lead to the complete abandonment of fossil fuels.
Russia, which has for years been trying not to notice where the developed economies were heading, and ignoring renewables, risks being left on the sidelines of history and in to soon say goodbye to the self-proclaimed status of "energy superpower."
Nord Stream 2 will most likely forever remain a rusty monument to human insidiousness and stupidity at the bottom of the Baltic Sea
The colossus that Putin has been building for years, blackmailing and corrupting European countries, is about to fall. His feet of clay have already started cracking: Nord Stream 2 will most likely forever remain a rusty monument to human insidiousness and stupidity at the bottom of the Baltic Sea, while the Kremlin's dreams of higher demand for Russian natural gas in Europe will never materialize.
Ukraine, for its part, can also contribute to the collapse of this Colossus. Ukraine's success lies with the defeat of Putin's Russia. It must pursue its market reforms, integrate into European projects on implementing ambitious plans for the development of renewables and other environmentally friendly energy sources, as well as enhance cooperation with neighboring countries and the United States, gradually transforming one of Eastern Europe's regions into one of the major energy markets.
The main thing is for Ukraine not to stop on its path. In such a rapidly changing and unpredictable world, stagnation is tantamount to death, even for countries whose regional dominance once seemed unshakable.
Ihor Orel
