Germany will freeze the Nord Stream 2 gas pipeline in case of any "escalation" between Russia and Ukraine, the new German foreign minister said, citing an agreement between her country and the United States.
"In the event of further escalation this gas pipeline could not come into service," Annalena Baerbock told German media, as quoted by AFP.
The remarks follow a comment from Germany's new Prime Minister, Olaf Scholtz that "It would be a serious mistake to believe that violating the borders of a European country would remain without consequences."
The Nord Stream 2 pipeline that will double the capacity of the existing Russia-Germany artery by 55 billion cubic meters of gas, is awaiting certification from the German authorities. The pipeline was completed earlier this year but Germany said it cannot give it the green light until several formal requirements were met.
The latest-flare up with Ukraine came after the U.S. claimed it had intelligence that Russia was planning an invasion into its neighbour, which spurred a series of warnings from Washington and Brussels to Moscow.
Meanwhile, the certification process for the infrastructure has been suspended by the German authorities because the pipeline must have an operator that is incorporated under German law. This means that the commissioning of the pipeline could be delayed until March next year. It could be delayed even further because after Germany approves it-if it does-the project will have to go to the European Commission, which would be tasked with making sure it complies with EU regulations.
According to government sources from European countries, it is because of this potential delay that Russia is not sending more natural gas to Europe, beyond what it is obliged to send under long-term contracts. The problem for Europe is this limited supply of gas could continue for months during the season of the highest demand.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More
Comments
So Germany’s threat to freeze Nord Stream 2 gas pipeline in case of any escalation between Russia and Ukraine is just hot air. While Germany can for a short freeze Nord Stream 2, it will be forced eventually to reactivate it because of its growing dependence on Russian piped gas and also because hundreds of German companies have invested hugely in the pipeline. The loss to them could match Russian losses if not exceed them. Moreover, Russia could immediately suspend any gas shipments to the EU and Germany via Ukraine thus depriving the Ukraine of gas transport royalty which are essential for the survival of the Ukraine economy.
So if Germany tries to play Russian roulette with Russia, we can easily judge who will be the eventual loser.
If Germany is worried about a Russian invasion of Ukraine, then it should along with the EU and the United States try to de-escalate the situation by giving an undertaking to Russia that they won’t bring Ukraine to NATO. That will be the end of Ukraine as an independent country. Neither the United States nor the EU or both combined could stop this happening. So it is better not to provoke Putin’s Russia into action.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London
Obviously if Europe brought back online the massive Dutch natural gas field this problem would be solved tomorrow but instead for reasons quite mysterious Europe has chosen ... well, War to be precise...instead.