In response to Russian threats to invade Ukraine, Germany has put a halt on the certification process for the Nord Stream 2 natural gas pipeline. The pipeline runs parallel to the first Nord Stream under the Baltic Sea, providing an avenue to bring natural gas to Europe. The 27-nation European Union imports about 80% of the natural gas it uses, with Russia supplying 41% of it, along with more than a quarter of the E.U.’s crude oil imports.
Dmitry Medvedev, chair of Russia’s security council and former president of the federation, met Germany’s announcement with a tweet that reads “Welcome to the brave new world where Europeans are very soon going to pay 2,000 euros for 1.000 cubic meters of natural gas!”
Natural gas prices have surged in Europe as Russia exported less, using its leverage to aim for a quicker approval of the 765-mile Nord Stream 2. This sent the E.U. on a mission to seek imports from elsewhere, and it has been purchasing liquid natural gas from the U.S., Qatar, Algeria, and others.
Energy supplier Gazprom, which is majority state-owned, is the largest company in Russia and contributes heavily to the national budget. Since Europe is a key market, Germany’s Nord Stream 2 suspension puts pressure on Russia with the threat of a large financial hit if it invades Ukraine. Nord Stream 2 is already built and, according to Russian President Vladimir Putin, already filled with gas. Germany has resisted calls to halt the project, which bypasses pipelines through Ukraine, in the past but has acquiesced.
“Now it’s up to the international community to react to this one-sided, incomprehensible and unjustified action by the Russian president,” German Chancellor Olaf Scholz told reporters in Berlin, adding that it was necessary to “send a clear signal to Moscow that such actions won’t remain without consequences.”