Biden orders US sanctions on Nord Stream 2 gas pipeline, corporate officers

The US will impose sanctions on Nord Stream 2 AG, the company that built Russia's 55 Bcm/year gas pipeline to Germany, and its corporate officers, President Joe Biden said Feb. 23, a day after Germany halted certification of the project.

"These steps are another piece of our initial tranche of sanctions in response to Russia's actions in Ukraine," Biden said. "As I have made clear, we will not hesitate to take further steps if Russia continues to escalate."

S&P Global Platts Analytics, which previously expected Nord Stream 2 to start service in October 2022, removed the project from its outlook Feb. 22. It now expects lower Russian gas flows to Europe.

"Most of that volume will have to be replaced by LNG on the back of demand switching and destruction in Asia," said James Huckstepp, Platts Analytics manager of EMEA gas analytics. "In Europe, we will also need to see continued fuel switching in power and refining, with coal generation capacity returning and having its lifespan extended, along with the ongoing prioritization of gas over oil exports in Norway, which will all require higher gas prices."

The Biden administration imposed a first tranche of new sanctions against Russia Feb. 22, a day after Russian President Vladimir Putin ordered troops into eastern Ukraine and recognized two breakaway regions.

The US Treasury Department imposed restrictions on Russian sovereign debit and sanctions against the Corporation Bank for Development and Foreign Economic Affairs Vnesheconombank (VEB) and Promsvyazbank Public Joint Stock Company (PSB), along with 42 of their subsidiaries.

Five Russian commercial vessels, including oil tankers Linda and Pegas, appeared on Treasury's list of blocked entities.