The Financial Times (FT) reported over the weekend that “Putin ally pushes deal to restart Nord Stream 2 with US backing” in reference to his decades-long close friend Matthias Warnig’s alleged efforts.
The gist is that possible American ownership over Nord Stream could lead to the resumption of Russian gas exports to Germany via this megaproject’s one undamaged pipeline as part of a grand deal. This was first floated in late November with regard to US investor Stephen Lynch’s related proposal.
This time it’s reportedly being advanced by Warnig through a different US-led consortium involving Lynch. In any case, the fact that it’s back in the news shows how serious the nascent Russian–US “New Detente” has become since they began talks a few weeks ago in Riyadh.
The logic is sound, too, since the EU’s German leader requires less costly gas to stave off a potential recession that could bring down the bloc and make it much less important of a market for US exports, notwithstanding those two’s tariff tensions.
Trump was adamantly opposed to Nord Stream during his first term on the pretext that it could make Germany dependent on Russia and then increase the chances that those two manage Central & Eastern Europe (CEE) on their own in order to squeeze out US influence.
The reality, though, is that he just wanted American LNG to poach Europe’s enormous gas market from Russia as part of an economic power play. These interests remain but might be advanced differently owing to the new global circumstances.
The “shock therapy” that the US pressured Europe into implementing after “decoupling” from Russian pipeline gas – which still remains incomplete due to its increased purchase of costlier Russian LNG out of necessity owing to an absence of other suppliers – had huge consequences.
The real economy suffered as a result of the sudden spike in prices across the board, when there could have been a gradual transition instead, like Trump envisaged had he remained in power and prevented the war.
The US’ long-term interests would therefore be better served by compromising on his American LNG plans for now by allowing the resumption of some Russian pipeline gas to Germany via the undamaged Nord Stream pipeline under US supervision upon obtaining ownership of it.
Likewise, the German-led EU would be compromising on its so-called “values” by agreeing to this pragmatic arrangement, while Russia’s compromise would consist of losing ownership in exchange for accelerated sanctions relief.
What’s being tabled now is much like what was proposed in this early January briefing on creative energy diplomacy.
In particular, this concerns the US approving the EU’s partial resumption of Russian gas pipeline imports; returning some of Russia’s seized assets as compensation for the US obtaining control over Nord Stream; and the US lifting some sanctions like its SWIFT ban for facilitating the resumption of the Russian-EU energy trade.
To be sure, it’s possible that none of this materializes, at least with regard to Nord Stream. There are still some variables that could offset this scenario, not least of which could be Trump’s unwillingness to temporarily cede some of the US’ poached European gas market share back to Russia or the new German leader’s goal of “achieving independence” from the US.
Nevertheless, the latest reports suggest that it’s premature to rule out Nord Stream’s partial revival, and it might happen sooner than later.
This article was first published on Andrew Korybko’s Substack and is republished with kind permission. Become an Andrew Korybko Newsletter subscriber here.
