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Russia Reform Monitor - No. 2253

The perils of Nord Stream 2;
Russia's sense of siege

Edited by Ilan Berman and Margot Van Loon
September 24, 2018

August 18:

U.S. sanctions likely overshadowed Russian President Vladimir Putin's recent meeting with German Chancellor Angela Merkel, the Wall Street Journal writes. The two leaders met to discuss the future of the Nord Stream 2 pipeline being built by Russia's Gazprom with substantial German backing to supply natural gas to Europe across the Baltic Sea. However, the United States has consistently opposed the project because of the extra leverage it would provide Russia to collect revenue, cut Ukraine out of the gas supply chain, and weaponize its control of the pipelines over dependent European consumer nations. An American official has told the Journal that the sanctions approved by Congress last August will likely now be used as levers against the major European companies or banks involved in the project to amplify political risk in an attempt to prevent its completion. However, one European energy executive commented that over $6.3 billion had already been invested in the pipeline, and the sanctions would be unlikely to deter continued progress.

August 20:

Most Russians believe in the existence of a broad-based, organized international conspiracy to undermine Russian society, a new survey by one of Russia's leading public opinion institutes has found.
The Moscow Times reports that two-thirds of the 2,000 Russian citizens surveyed by the Moscow-based Russia Public Opinion Research Center (VTsIOM) in a nationwide survey carried out in late May believe that "there is a group of people who seek to rewrite Russian history and replace the historical fact in order to hurt Russia and diminish its greatness." Another 63 percent concurred that "a group of people are trying to destroy the spiritual values formed by Russians through the propaganda of non-traditional sexual relations."

These views, moreover, were not those of the uninformed or uneducated. Rather, as the Times details, "the older a respondent became, and the more educated, the more likely they were to agree with the statements referencing a group of people working to undermine Russia in some form."

[EDITORS' NOTE: Given the effect of Russia's increasingly authoritarian political climate on pollsters and respondents alike, the results of public opinion surveys in Russia should be viewed with some caution.]

August 21:

As Turkey grapples with worsening relations with the United States and a sanctions-induced currency crisis, Russia is positioning itself as a more reliable partner for Ankara.
According to Radio Free Europe/Radio Liberty, state-owned arms exporter ROSOBORONEXPORT has announced that it will not only deliver its S-400 anti-aircraft missile system to Turkey by next year, but that it will also cease to conduct its foreign transactions in U.S. dollars. RFE/RL writes that the S-400 sale has been a flashpoint between the United States and its NATO ally because of the security concerns inherent in integrating a Russian platform into NATO defense systems. Ankara's decision to proceed with the purchase prompted Congress and the Trump administration to recently delay the delivery of American F-35 fighter jets to Turkey.

The U.S. campaign of economic pressure against Russia has expanded yet again with the addition of new individuals and companies to a growing sanctions list.
The Associated Press reports
that four of the newly sanctioned entities – two companies and two individuals – allegedly participated in attempts to circumvent earlier U.S. sanctions, while two other companies allegedly transferred petroleum to North Korea in violation of UN Security Resolutions. British Foreign Secretary Jeremy Hunt appeared to support the sanctions imposition through a concurrent public statement, in which he called for parallel comprehensive European sanctions and exhorted the EU and the United States to respond to Russia with "one voice."

But are sanctions working? According to the AP, Congress has held multiple hearings to assess the sanctions' impact on Russia's malign activity. The senior Treasury and State Department officials who testified asserted that the measures are effective, and that without them Russia's "behavior would be even further off the charts." However, some senators have expressed skepticism that the measures truly hold Russia accountable for its actions, criticizing a bifurcation between the sanctions policy and President Trump's "undisciplined" public messaging about Vladimir Putin and the 2016 election hacking.

Related Categories: Russia; Economic sanctions/warfare; Russia and Eurasia Program

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