Russia Considers Re-entering European Gas Market Amid Sanctions and Ongoing Ukraine Conflict, According to Report
Russia is reportedly in discussions to revive gas supplies to Europe through the Nord Stream pipelines, which previously transported Russian gas to Germany. Talks are underway to involve a U.S. investor in the project, with U.S. Special Envoy Jared Kushner and Kirill Dmitriev, an advisor to Russian President Vladimir Putin, playing key roles in the negotiations. Kushner views business agreements as essential to fostering peace between Russia and Ukraine, and a potential deal could allow U.S. investors to benefit from energy flows to Europe once the conflict concludes.
Nord Stream Back on the Table
Kushner and Dmitriev have met in Moscow and New York in recent weeks to discuss the potential revival of the Nord Stream project. While details of the discussions remain sparse, sources indicate that the pipeline is still a topic of interest. Dmitriev has been advocating for the resumption of Russian gas sales to Germany and recently met with U.S. energy and treasury department representatives to explore possible U.S.-Russia energy initiatives. A White House official stated that any agreements would need to be negotiated with the U.S. International Development Finance Corporation (DFC) and Treasury, ensuring they benefit U.S. taxpayers and companies.
Restarting Gas Flows Won’t Be Easy
Reviving Russian gas supplies to Germany faces significant challenges. The Nord Stream pipelines are currently under sanctions from the U.S. and the EU, rendering any restart illegal. A U.S. official indicated that a deal is unlikely in the medium term due to these obstacles. While U.S. President Donald Trump could potentially ease sanctions, this may become more difficult if Democrats gain control of Congress in the upcoming midterm elections. Germany and other European nations are also expected to oppose the reopening of Nord Stream, as they are investing heavily in military defenses against Russia.
Germany Split Over Russian Gas
The prospect of resuming Russian gas imports has divided opinion within Germany. The coalition government is against restarting the pipeline, while the Alternative for Germany (AfD) party supports it. Dmitriev is scheduled to meet with AfD leadership early next year to discuss the possibility of selling Russian gas again. Poland, which remains firmly opposed to reopening the pipeline, is closely monitoring the discussions. The backdrop of these talks is marked by deep European mistrust of Russia’s intentions, with European intelligence officials suggesting that Russia is not interested in a swift end to the war.
Who Owns Nord Stream?
Ownership issues could complicate any U.S. investment in Nord Stream. Russian state energy giant Gazprom holds a 51% stake in the company, with 31% divided between two German entities, and the remaining shares owned by a French and a Dutch firm. The German shareholders are keen to maintain their stakes to preserve German influence should Gazprom decide to sell its share. Following the meetings in Moscow, Kushner mentioned in Kyiv that he had discussed the impact of the war on energy prices with European counterparts.
Lukoil Assets Also in Focus
In addition to Nord Stream, Kushner and Dmitriev have explored the potential sale of assets owned by Russian energy company Lukoil, including oil refineries and petrol stations in Europe. The proposal involves a consortium with the DFC and investors from Qatar and the UAE purchasing these assets, contingent on U.S. authorities lifting sanctions. A White House official noted that Kushner and his team negotiated a significant upfront payment and profit-sharing arrangement for the United States regarding Lukoil’s assets.
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