The White House is discussing lifting sanctions on Nord Stream 2 - Politico

The White House is discussing whether to lift sanctions on the Russian Nord Stream 2 gas pipeline and possibly other Russian assets in Europe as part of discussions to end the war between Russia and Ukraine, citing five people familiar with the discussions, Politico reports, writes UNN.

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The lifting of sanctions currently in place on one of Russia's main pipelines connecting its gas fields to Western Europe would be a sharp reversal of US policy, first introduced during President Donald Trump's first term. US President Joe Biden lifted the sanctions early in his term, but reimposed them after Russian dictator Vladimir Putin launched the invasion of Ukraine in 2022.

Restarting Nord Stream 2 could bring financial benefits to Moscow, but only if the EU agrees to buy Russian gas supplied by the pipeline again, a prospect that seems unlikely given the EU's campaign to abandon Russian energy imports, the newspaper writes. "But lifting sanctions would be tantamount to a diplomatic coup for Russia and a major concession from Trump," the publication said.

White House Special Representative Steve Witkoff has been the main proponent of lifting sanctions, people familiar with the talks told the newspaper. Witkoff, who said he became friends with Putin while serving as Trump's envoy to Moscow, "directed his team to compile a list of all energy sanctions the United States has imposed on Russia as part of the effort," two people familiar with the matter said.

In a joint statement released by the White House, US Secretary of State Marco Rubio and Witkoff denied that discussions about easing sanctions had taken place.

"This is a lie. Neither of us has had any conversations about lifting sanctions against Russia as part of a peace deal with Ukraine," their statement said. - This is just a completely fabricated and irresponsible report by Politico, a third-rate publication. If they have even a shred of journalistic integrity, they will completely abandon this fabrication."

Witkoff and Rubio were expected to attend peace talks scheduled for Wednesday in London, but they withdrew at the last minute. "The administration's settlement plan included recognition of Russia's illegal annexation of Crimea in 2014 and the lifting of sanctions - two things Ukraine has said it will not agree to," the publication notes. At the same time, the European Commission, as indicated, may propose to ban member states from signing new contracts with Russia for oil and gas.

A second person said that while Witkoff had floated the idea of lifting energy-related sanctions, the idea has not yet gained much traction in the White House, and that Rubio had tried to thwart it. "This is not a pie in the oven that is baking, although the ingredients are being gathered," the person said.

Among those who oppose the idea are Rubio and US Secretary of the Interior Doug Burgum, who also chairs the White House Energy Dominance Council, people familiar with the discussions said. Some in the US government believe that Russia has misled Witkoff about the extent of economic opportunities for the US in restoring business ties with Russia, according to another person familiar with the matter.

"There is an internal debate in the White House between people involved in energy dominance - Burgum, who wants to get markets for American LNG - and Witkoff, who wants to be closer to Russia," one of the publication's sources said. Restoring Russia's status as a leading energy supplier to Europe would be a "bloodbath for American [oil and gas producers]," the man continued.

According to Laurent Ruseckas, executive director of S&P Global Commodity Insights, allowing Russia to resume gas supplies from Nord Stream 2 or Arctic 2 LNG would lower global gas prices and put US LNG exporters such as Cheniere Energy and other companies in direct competition.

"If you put Russian gas back on the market, it will reduce the appetite of potential buyers of American LNG," Ruseckas said in an interview.

The US gas industry has made significant inroads into Europe as Germany and other countries have turned away from Russia as an energy supplier following its invasion of Ukraine. But oil and gas companies are now struggling with the administration's trade war and its tariffs on imported steel. Overall, the White House's opaque trade policy has also forced companies to reduce their investment plans, the newspaper writes.

Several outsiders are lobbying the administration to lift sanctions, two of the sources said. One of the "wooers" is Steven Lynch, chairman of Monte Valley Partners, a private investment firm based in Miami, the newspaper writes. Lynch reportedly specializes in buying energy infrastructure assets formerly owned by Russia. Matthias Warnig, a "former spy and close friend" of Putin who is under US sanctions, has also worked to try to restart the pipeline with the support of American investors, the newspaper writes. He reportedly contacted the Trump team through representatives of American business, and his efforts are believed to be separate from Lynch's consortium. The Biden team was not interested in Lynch's efforts to buy the pipeline last year.

Addition

Trump criticized Nord Stream during his first term and during the election campaign. He attacked Biden for lifting sanctions on the project in 2021 before later reimposing them.