Sweden is set to finally join Nato on Thursday, meaning the western defence alliance has nearly ringed the entire Baltic Sea, a significant oil trading route for Russia and home to one of its fleets.

“The Baltic Sea becomes a Nato lake,” said Krišjānis Kariņš, Latvia’s foreign minister and a self-declared candidate to head Nato.

As it formally becomes the 32nd member of the US-led alliance during a ceremony in Washington, Sweden brings with it the mid-Baltic island of Gotland — dubbed a “giant aircraft carrier” — which makes the defence of the three small Baltic states easier.

Sweden and Finland joining Nato was all but unthinkable three years ago. But when Russian tanks started rolling towards Kyiv in February 2022, the two Nordic countries woke up to what Moscow could do to its neighbours who were not members of the military alliance. Finland’s accession was completed last year, while Stockholm’s bid was held up by Turkey and Hungary.

Former Swedish Prime Minister Carl Bildt said his country joining Nato “is going to substantially increase the bang for buck in defence and deterrence in northern Europe”.

“For many years, we have been split up. Now, we need to think in more unified terms,” Bildt added.

Vladimir Putin, Russia’s president, has announced plans to reorganise Russia’s military and beef up forces in the region to “neutralise threats” he said arose from Sweden and Finland’s Nato membership.

Russian foreign minister Sergei Lavrov said last week that “all the long decades of good neighbourliness have gone to dust” because the US military “has the right to do whatever they want in Sweden — visit any site and create any of their own”.

Russia’s response would include “additional systems that will be appropriate to the threats that could appear on the territory of Finland and Sweden”, he said.

Russia’s interests in the Baltic Sea are both economic and military.

St Petersburg, which has substantial oil refineries, ships its exports via the Gulf of Finland through the Baltic Sea. The Russian exclave of Kaliningrad, wedged between Poland and Lithuania, is home to Russia’s Baltic fleet and nuclear-capable Iskander ballistic missiles. Russia has threatened to change the region’s “non-nuclear” status in the past but has not said whether the weapons carry nuclear warheads.

In case of a conflict, Estonia, Latvia and Lithuania up until now would have relied almost exclusively on securing reinforcements and supplies via the Suwałki Gap, a narrow and vulnerable 100km strip separating the Baltics from Poland. By joining Nato, Sweden provides new possibilities via the sea, as Gotland is less than 200km from the Latvian coast.

“It reduces the vulnerability of the Baltics through only the Suwałki Gap. The entire security of the region is made stronger because it makes the eastern Baltic less vulnerable,” said Kariņš.

Linas Linkevičius, Lithuania’s former foreign minister who is now its ambassador in Stockholm, said his country had been striving for Sweden to join Nato “for longer than Sweden had”.

He added: “With the opening of the Baltic Sea as a Nato sea, the Suwałki Gap becomes less vulnerable. Maybe the Russians should become more worried. Kaliningrad will not survive if they dare to challenge Nato.”

Sweden’s and Finland’s accessions also enable Nato to look at northern Europe as one big region, without a gaping hole in the map. “From Narva [in Estonia] to Nuuk [in Greenland] east-west, and Kirkenes [in Norway] to Kraków [in Poland] north-south,” as Bildt defined.

The Baltic states may be the biggest immediate beneficiaries from Sweden joining, with Stockholm set to send a battalion to join the multinational presence in Latvia. But the deepest changes over time are likely in the Nordic region itself.

Cooperation between the four main countries — Denmark, Norway, Sweden, and Finland — has long been close but is now set to become more intense.

A taster was provided last year when the four Nordic air forces announced their intention to operate their fleet of about 230 fighter jets as one seamless operation, making it larger than the RAF in the UK or Germany’s air force. Already, Norwegian F-35 and Swedish Gripen fighter jets have practiced landing on Finnish roads.

“Nato consists of a few great powers and lots of medium or small powers. There’s quite a potential for the Nordics,” said Anna Wieslander, director for northern Europe at the Atlantic Council think-tank. “The airspace over the Scandinavian peninsula is important and always has been if you look at world war two or the cold war. If you control the airspace over the Nordics, you really have an advantage.”

She added that there was potential for deeper co-operation among land and naval forces.

Sweden, which does not have a direct border with Russia, is likely to play a different role for Nato military planners than the frontline states. Officials say it would be a logistics hub in case of a conflict as well as a route for reinforcement of Finland or the Baltic states.

But it also brings special capabilities. It has long experience with submarines and sub-sea capabilities, increasingly crucial in a Baltic Sea that has suffered several unexplained incidents of sabotage in recent years from the blowing up of the Nord Stream gas pipelines to the cutting of gas and data links between Finland and Estonia by a Chinese ship’s anchor.

Both Bildt and Wieslander have underscored that the Baltic Sea is open to all, including Russia, and that just because it is now ringed by Nato states does not reduce the risk of a conflict.

The problem with the expression “Nato lake”, Wieslander said, “is that it should not give a false illusion that it won’t be an area of potential tension or high risk”.

“Russia is still there, but it will be more squeezed.”