Kremlin hails US pipeline sanctions waiver ahead of summit

The Kremlin on Thursday praised the waiving of US sanctions against the Russian-controlled builder of a Russia-Germany gas pipeline, while Ukraine’s leader warned Joe Biden’s administration against cancelling the sanctions altogether.

The US waiver was announced as Moscow and Washington seek to defuse the biggest crisis in ties in years ahead of a planned summit between Biden and Russian leader Vladimir Putin.

On Wednesday, the United States formally waived sanctions against Swiss-based Nord Stream 2 AG, the Russian-controlled builder of a major Russian-German gas pipeline.

The US announcement was a significant reversal of Washington’s earlier stance and was primarily aimed at easing tensions between Washington and Berlin over the $12-billion project, which Germany and other European countries see as crucial to securing long-term energy supplies.

But US Secretary of State Antony Blinken also said that Biden’s administration would “continue to oppose the completion of this project”, arguing it would weaken European energy security.

Russian neighbours Ukraine, Poland and the Baltic states have fiercely opposed the pipeline, fearing it will increase Moscow’s political leverage in regional politics.

The US announcement came as Blinken and Russian Foreign Minister Sergei Lavrov met on the sidelines of an Arctic Council meeting in Reykjavik, the first high-profile talks between the two countries under Biden’s administration.

Putin’s spokesman Dmitry Peskov said Thursday that the sanctions waiver was a “positive signal”.

“We are convinced that the project should not be a target of pressure from third parties. This is illegal,” he told reporters.

In 2020, the possibility of US sanctions held up pipeline-laying operations for nearly a year.

– ‘Loss for Biden’ –

Ukrainian President Volodymyr Zelensky expressed concern over the US policy reversal on the Russian-led pipeline and said he was worried Washington could move to completely lift the Nord Stream 2 sanctions.

“I think there is a big risk that they (Russia) might put pressure on the United States … to lift the sanctions on Nord Stream,” the 43-year-old Ukrainian leader told reporters during a three-hour news conference.

“This will be a major geopolitical victory for the Russian Federation,” Zelensky said. “It would be a loss for the United States and President Biden personally.”

Russian energy giant Gazprom has a majority stake in the project, working alongside an international consortium that includes Germany’s Wintershall and Uniper groups, Dutch-British giant Shell, France’s Engie and Austria’s OMV.

Gazprom also controls Nord Stream 2 AG whose chief executive, Matthias Warnig, is reportedly close to Putin.

Zelensky also called for greater support for Ukraine from France and Germany.

“I believe that they have recently been softening their stance on Russia,” Zelensky said during his annual news conference.

– ‘Stop the war now’ –

Ukraine has been at loggerheads with Russia since a 2014 uprising ousted a Kremlin-friendly leader, Moscow annexed Crimea and a conflict broke out between Kiev’s forces and pro-Russian separatists in the east.

The war has claimed more than 13,000 lives.

After a lull last year, fighting escalated in January and last month Russia amassed 100,000 troops near the Ukrainian border and in Crimea, prompting warnings from NATO.

Russia later announced a pullback but both Washington and Kiev say that the withdrawal has been limited.

Zelensky, who was elected in 2019 on promises to end the war, last month invited Putin to meet for talks in the war-ravaged east of Ukraine.

The Russian leader has however proposed a meeting in Moscow and stressed that Zelensky should discuss the war directly with separatists.

On Thursday, Zelensky reiterated his call to Putin for “direct” talks.

“We must stop the war now, when Putin is still Russia’s president, I really want this, I believe in it,” he said.

“You and I have no other chance.”

Putin’s spokesman confirmed that preparations for the talks were underway but refused to provide any specifics.

“The process is not easy,” Peskov told reporters.

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