A major contractor working on a gas pipeline linking Russia and Germany has stopped work after the United States imposed sanctions on firms involved in the project.

Nord Stream 2 runs through the Baltic Sea, from Ust Luga in the east, near St Petersburg, to the town of Greifswald, near the Germany-Poland border.

In doing so, it by passes Ukraine, which has traditionally been the main route for Russian gas.

Moscow and Kiev have been in dispute since Russia annexed Crimea in 2014.

Once Nord Stream 2 is finished it will double the amount of Russian gas flowing into Germany after an initial pipeline, Nord Stream 1, was opened in 2012.


Image: A map showing the Nord Stream 2 route

Washington, meanwhile, wants to sell more of its own liquefied natural gas to European states - the White House fearing that Nord Stream 2 will make Europe too reliant on supplies from Russia.

More than a third of Europe's gas needs already come from Russia's state-controlled giant Gazprom, which is a major backer of Nord Stream 2.

Allseas, a Swiss-Dutch company, said it had stopped laying pipes, and was expecting guidance from the US.

Moscow struck a defiant note, saying it would "continue to implement its economic projects regardless of anyone's sanctions".

Germany "firmly rejects" US sanctions but would not retaliate, Finance Minister Olaf Scholz said.

Nord Stream 2 said that completing the project was "essential for European supply security".

It continued: "We together with the companies supporting the project will work on finishing the pipeline as soon as possible."

Image: Workers on a pipe-laying ship called Solitaire

The US Senate passed legislation to slap sanctions on companies building the massive underwater pipeline on Tuesday, but it took until Friday before Donald Trump signed the bill into law.

Senator Jim Risch, a Republican and the chairman of the Senate Foreign Relations Committee, said the sanctions would prevent the project's completion and were an "important tool to counter Russia's malign influence and to protect the integrity of Europe's energy sector."

The US claims that several European countries are concerned about growing reliance on Russian gas.

Apart from Nord Stream there are two other lines taking gas from Russia to Europe - the Brotherhood pipeline which goes through Ukraine, and the Yamal-Europe pipeline which passes through Belarus and Poland.

Ukraine earns strong revenues from gas transit fees, and agreed a new deal with Russia this week after long-running talks.