German Chancellor Olaf Scholz announced on Tuesday that the certification process for the Nord Stream 2 gas pipeline would be halted, saying “the situation has fundamentally changed” after the Kremlin ordered troops to be sent to eastern Ukraine.

Why is this important: It’s a stunning turn of events for the $10 billion gas pipeline between Russia and Germany, which Scholz had long resisted naming as a potential target for sanctions if Russia invades Ukraine.

Between the lines: Ukraine views the Putin-backed project as an existential threat to its security, as it would deprive the country of billions of dollars in gas transit fees and allow Russia to deliver gas directly to the heart of Europe.

• The United States has long maintained that Nord Stream 2 is a malicious geopolitical influence project by the Kremlin that would increase Europe’s dependence on Russian gas, but President Biden has allowed construction to proceed. last year in order to restore relations with Germany.
• Germany’s economy is heavily dependent on Russian gas, which had raised questions about Berlin’s willingness to stand up to Moscow with the tough sanctions the United States and other European allies had promised.

What they say : “I welcome Germany’s decision to suspend certification of Nord Stream 2. It is a morally, politically and practically correct step in the current circumstances. True leadership means tough decisions in tough times. Germany’s decision Germany proves it,” the Ukrainian foreign minister said. tweeted.

The big picture: Russian President Vladimir Putin announced on Monday that he would recognize two pro-Russian separatist ‘republics’ in eastern Ukraine and ordered Russian ‘peacekeeping forces’ to enter the territory where the proxies of the Kremlin have been leading a rebellion against the Ukrainian government since 2014.

• The move drew widespread international condemnation, but questions arose over whether it would trigger the “massive” sanctions the United States and its allies had promised in response to a full-scale invasion.
• Biden said in a press conference with Scholz earlier this month that “there will be no more Nord Stream 2” if Russian troops cross the border into Ukraine, but the German Chancellor declined to make that commitment.
• A senior US official was also hesitant Monday night to call Putin’s actions a “new step”, noting that Russian forces had been secretly present in eastern Ukraine for eight years.

What to watch: The United States, United Kingdom and European Union have said more sanctions are coming. But stopping Nord Stream 2 in the first place is by far the most difficult measure the West has taken against Russia so far.