Germany threatens retaliation if US pushes ahead with Russia sanctions it says could harm European economy

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German leaders have reacted angrily to proposed new American sanctions on Russia they say target Moscow’s new gas pipeline to Europe, threatening retaliation if the measures harm the European economy.

The stand-off comes amid already strained relations with the US over Donald Trump’s aggressive rhetoric and provoked accusations that America was trying to promote its own gas exports to Europe by blocking Russia.

The result is a rumbling threat of a new energy war and a breakdown in trans-Atlantic unity against Russian aggression.

The original Nord Stream pipeline opened in 2012

The original Nord Stream pipeline opened in 2012 Credit: AFP

A spokesman for Angela Merkel, the German chancellor, said she was concerned by the new sanctions. “It is, putting it mildly, a peculiar move by the US Senate,” he said.

Senators insist their bill – passed on Thursday by a margin of 98 to two – is designed to punish Moscow for interfering in last year’s presidential election and limit Mr Trump’s ability to lift sanctions.

It includes punitive measures for anyone helping Russia build energy export pipelines.

The bill must still be approved by the House of Representative and President Trump, but already Berlin fears it could bring fines against European companies involved in Nord Stream 2, a project to build a pipeline carrying Russian gas under the Baltic Sea.

The sanctions are designed in part to make it more difficult for Mr Trump to lift sanctions on Russia

The sanctions are designed in part to make it more difficult for Mr Trump to lift sanctions on Russia Credit: EPA

Brigitte Zypries, economy minister, accused Washington of abandoning a joint approach with Europe on sanctions against Russian and threatened retaliation if Mr Trump signed it into law.

“If he does, we’ll have to consider what we are going to do against it,” she told Reuters.

It marks the latest area of conflict between Washington and Berlin since Mr Trump took power, following the US President’s criticism of Germany’s trade surplus, defence spending and his broader attacks on global co-operation.

The Nord Stream 2 pipeline is being built beneath the Baltic Sea to supply Russian gas to Germany and beyond. It avoids older routes through Ukraine, which have been disrupted by disputes between Kiev and Moscow.

In a joint statement, Sigmar Gabriel, the German Foreign Minister, and Christian Kern, the Austrian Chancellor, said European energy supplies were a matter for Europe not the US.

Donald Trump V Angela MerkelDonald Trump v Angela Merkel: can the two find common ground? 01:29

They accused the US of trying to elbow its way into the EU market to protect American jobs by deploying foreign policy for economic gain.

“To threaten companies in Germany, Austria and other European firms with fines in the US if they take part in or finance energy projects like Nord Stream 2 represents a new and negative dimension to US-European relations,” they said.

The bill is designed in part to make it more difficult for Mr Trump to lift sanctions imposed on Russia for annexing Crimea. As a candidate, he was vocal in his praise for Vladimir Putin, raising suspicions that once in office he would ease restrictions in return for Russian support.

It also introduces sanctions against anyone conducting cyberattacks on behalf of the Russian government, following evidence that Moscow was behind attempts to swing the presidential election in Mr Trump’s favour. 

“The legislation sends a very, very strong signal to Russia, the nefarious activities they’ve been involved in,” said Bob Corker, Republican chairman of the Senate Foreign Relations Committee.