US Slaps Fresh Sanctions on Nord Stream 2

The US announced fresh sanctions related to the controversial Nord Stream 2 natural gas pipeline Friday, moving to block two Russian vessels and two individuals over the nearly completed project. The new sanctions target one Russian ship involved in the last vestiges of pipelaying work, the Ostap Sheremeta; the Russian owner of another vessel, the JSC Nobility; and a construction firm, Konstanta OOO. The new measures bring the total number of vessels in the project blocked under US sanctions up to 16. The US has now sanctioned seven people over the project, Secretary of State Antony Blinken said in a statement Friday. The White House also issued an executive order on Friday allowing for sanctions to be imposed on certain Russian energy export pipelines, levying a threat of possible further action. A State Department spokesman Friday reiterated the US opposition to Nord Stream 2 as a "bad deal for Ukraine and a bad deal for Europe," and harmful to the US from a geopolitical standpoint. Friday's announcement prompted a fresh round of criticism from Republican lawmakers of the Biden administration's so far narrow sanctions regime related to the pipeline. Michael McCaul, the top Republican on the House Foreign Affairs Committee, said Friday that the administration failed to impose congressionally crafted rounds of additional sanctions against the project, which has "paved the way" for it to become operational. Transit Deal Meanwhile, prior to the US announcement on Friday, Russian President Vladimir Putin said again that his country is ready to continue shipping its natural gas to Europe via Ukraine after the current transit deal expires in 2024. However, during talks with German Chancellor Angela Merkel in Moscow, Putin emphasized that much would depend on demand levels in Europe. "We need to understand for which period of time and in what volumes" customers would continue buying Russian gas, Putin said. European carbon-neutrality plans have raised questions over the continent's future gas demand and how big the market will be for future Russian exports. Gazprom's current export contracts with European customers amount to around 200 billion cubic meters per year. Ukraine's continued role as a transit hub for Russian gas was one of the key terms of the recent agreement between Berlin and Washington for the Nord Stream 2 pipeline, which runs from Russia to Germany under the Baltic Sea and bypassing Ukraine. Under the pact, Ukraine will continue to play a transit role through at least 2034 in exchange for the waiving of US sanctions that had delayed the project for more than a year-and-a-half, thereby ensuring the pipeline's completion. At the Finish Line The impacts of the US measures announced Friday were not immediately clear. Putin said at a press conference after the talks with Merkel that only 15 kilometers of the 55 billion cubic meter per year pipeline remain to be built. Gazprom said Thursday that it plans to ship 5.6 Bcm of gas by the end of the year via Nord Stream 2 (IOD Aug.19'21). Ukrainian leaders were disappointed with the deal between Germany and the US on Nord Stream 2 and see the pipeline as a threat to the country's national security. They fear Kiev could stop getting paid by Moscow for transiting roughly 40 Bcm/yr of gas to Europe (IOD Jul.22'21). Ukrainian President Volodymyr Zelenskiy still hopes US President Joe Biden will block Nord Stream 2 and plans to discuss the matter when he visits the US at the end of August. Merkel will travel to Kiev on Sunday for talks. Nelli Sharushkina, Moscow, and Bridget DiCosmo, Washington