The US and Germany have struck a compromise over the controversial Nord Stream 2 gas pipeline, according to a joint statement.
The pact comes days after Chancellor Angela Merkel's last official visit to Washington prior to leaving office this September. Officials had talked up the chances of an accord during the visit, and during Joe Biden's tour of Europe in June.
The two countries agreed to support Ukraine and to sanction Russia if it tries to use energy supplies for gaining geopolitical leverage.
"The United States and Germany are united in their determination to hold Russia to account for its aggression and malign activities by imposing costs via sanctions and other tools," the statement read.
"Should Russia attempt to use energy as a weapon or commit further aggressive acts against Ukraine, Germany will take action at the national level and press for effective measures at the European level, including sanctions, to limit Russian export capabilities to Europe in the energy sector, including gas, and/or in other economically relevant sectors," it said.
As part of the deal, Germany agreed to make investments into Ukraine and to actively ensure Moscow and Kyiv extend a gas transit agreement.
Additionally, Germany and the US would invest $1 billion (€0.85 billion) in a "Green Fund" to foster Ukrainian green-tech infrastructure, encompassing renewable energy and related industries, with the goal of improving Ukraine's energy independence.