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Joe Biden has agreed a deal with Angela Merkel to allow the completion of a controversial gas pipeline from Russia to Germany, with huge implications for the control of energy in Europe.
Mr Biden on Wednesday accepted letting the Nord Stream 2 pipeline go ahead but warned that if Russia sought to use energy as a weapon against Ukraine or other countries in the region, both the US and Germany would retaliate.
With the deal, Mr Biden appeared to have prioritised improving relations with Berlin, which supports the pipeline. Those relations suffered under Donald Trump's administration and boosting them is part of Mr Biden's agenda of creating a united front of allies against Moscow, and also Beijing.
The White House said it was still opposed in principle to the pipeline and would impose sanctions if Russia tried to manipulate energy flows.
Republicans accused Mr Biden of leaving European allies "at the mercy of Putin" by allowing the completion of the pipeline, which is 98 per cent finished and will carry gas from Russia's Arctic region to Germany.
Republicans said Mr Biden was giving a "gift" to the Kremlin and "actively helping Putin build his pipeline."
The Kremlin on Wednesday said it would not use energy supplies as a tool to exert political pressure on Ukraine.
The pipeline through the Baltic Sea has been vigorously opposed by Ukraine, which has been battling pro-Moscow separatists since 2014 and sees the transit of Russian gas through its territory as vital leverage.
How Nord Stream bypasses major pipelines
Under the expected deal Germany would agree to contribute to a new $1 billion fund to help Ukraine transition to cleaner sources of energy.
Germany would provide an initial investment of $175 million, Bloomberg reported.
Angela Merkel, who supports the pipeline, visited the White House last week and discussed it with Mr Biden.
A US official said: "The Germans have put forward useful proposals and we have been able to make progress on steps to achieve that shared goal to ensure that Russia cannot weaponise energy flows."
Earlier this year Mr Biden waived sanctions against the company constructing the pipeline.
US state department spokesman Ned Price said the Biden administration continued to oppose it but sanctions would not stop it being finished.
He said: "We view it as a Kremlin geopolitical project that is intended to expand Russia's influence over Europe's energy resources and to circumvent Ukraine.
"We have made no bones about the fact that it is a bad deal for Germany, it is a bad deal for Ukraine and for Europe more broadly."
But Mr Price said it did not make sense to try to stop a project that was "more than 90 per cent complete on day one of this administration."
He added: "We did not believe that sanctions could stop the completion of the pipeline."
Derek Chollet, a senior US state department official, has been sent to Ukraine to discuss the deal with President Volodymyr Zelensky in what were expected to be contentious talks.
Mr Chollet was also visiting Poland, which strongly opposes the pipeline.
In a concession to Poland, Germany agreed to sign the "Three Seas Initiative" which aims to boost investment and infrastructure in the region.
Pat Toomey, a Republican senator in Washington, said: "Any deal that allows for the completion of the Nord Stream 2 pipeline is badly flawed.”
Germany refused a US proposal to impose a "kill-switch clause" under which Berlin would have the power to suspend operations of the pipeline, the Wall Street journal reported.
Jen Psaki, the White House press secretary, said: "We have ongoing concerns about how the project threatens European energy security, undermines Ukraine security, and the security of our Eastern flank Nato allies and partners."
Republicans have accused Mr Biden of hypocrisy for allowing the Nord Stream 2 project to go ahead after cancelling the Keystone XL pipeline, costing thousands of jobs in North America.
The US sought to assuage Ukraine by inviting its president to the White House, and moments after the deal was confirmed it was announced that Mr Biden would host Volodymyr Zelensky on Aug 30.
Jen Psaki, the White House press secretary, said the visit would affirm "our close cooperation in energy security."
She said the US had "unwavering support for Ukraine’s sovereignty and territorial integrity in the face of Russia’s ongoing aggression."
Republican congressman Steve Womack said: "The implications of Nord Stream 2 are startling. Its completion will leave Ukraine and European energy at the mercy of Putin.
"The Biden administration's current posture is shaping up to be one of the greatest foreign policy blunders in recent history. This project needs to be stopped."
Ted Cruz accused Mr Biden of "total surrender to Putin on Nord Stream 2."
Mr Cruz said: "This will be a generational geopolitical win for Putin and a catastrophe for the United States and our allies.
"Decades from now Russian dictators will still be reaping billions from Biden's gift, and Europe will still be subject to Russian energy blackmail."