Germany will halt the Nord Stream 2 pipeline project with Russia until further notice after Moscow formally recognized the two separatist republics of eastern Ukraine, Chancellor Olaf Scholz announced Tuesday.
“The situation today is fundamentally different and therefore, in light of recent events, we must also reassess this situation … also with regard to Nord Stream 2,” Scholz said.
Speaking to reporters in Berlin, Scholz said he had asked for the certification process for the pipeline to be suspended.
"That sounds technical, but it is the necessary administrative step so there can be no certification of the pipeline and without this certification, Nord Stream 2 cannot begin operating," he said.
Moscow responded sharply to Scholz's announcement, with former President Dmitry Medvedev tweeting: "Well. Welcome to the brave new world where Europeans are very soon going to pay 2,000 euros for 1,000 cubic meters of natural gas!"
The 10-billion-euro pipeline owned by Gazprom, which recently completed construction but is not yet operational, was set to transport 55 billion cubic meters of natural gas annually from Russia to Europe. It is owned by Russian state-controlled gas giant Gazprom.
Nord Stream 2 has been a major point of contention with Western countries and Ukraine, who argue that the pipeline will allow Moscow to exert political leverage over Europe. But Germany has until now insisted on following through with the project and the Kremlin denies using its energy resources as a political weapon.
Earlier Tuesday, Ukrainian leader Volodymyr Zelenskiy had demanded an immediate halt to Nord Stream 2.
Scholz warned Tuesday that Russia could face further sanctions in response to its actions in Ukraine.
"There are also other sanctions that we can introduce if further measures are taken, but for now, it's a matter of doing something very concrete," he said.
But he also urged for dialogue between Russia and the West to continue.
As well as sanctions, continued diplomacy is "important to prevent a further escalation and thus a catastrophe" in the region, Scholz said. "This is the objective of all our diplomatic efforts," he added.
AFP contributed reporting.