Russia and China Advance Pipeline Agreement to Boost Gas Supplies

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Power of Siberia 2 Agreement Moves Forward

Russia and China have moved closer to finalising their landmark energy partnership with a binding agreement to build the Power of Siberia 2 natural gas pipeline. The project, long under discussion, will carry up to 50 billion cubic meters of gas annually from Russia to China through Mongolia. The announcement came after talks in Beijing between President Vladimir Putin and President Xi Jinping, underscoring the strengthening energy and strategic ties between the two nations.

Gazprom confirmed that, alongside the new pipeline plan, gas flows through the existing Power of Siberia pipeline will rise from 38 to 44 billion cubic meters per year. These steps highlight Moscow’s pivot toward Asian markets as it seeks to solidify new energy lifelines and reduce reliance on European buyers. For Beijing, the deal supports long-term efforts to secure cleaner fuel supplies that can help reduce coal dependence.

Strategic Shifts and Open Questions

While the agreement is legally binding, key details remain unresolved. Pricing, construction timelines, and financing have not yet been finalised, leaving the pace of development uncertain. Analysts note that China holds considerable leverage in these negotiations, given its diversified energy supply options and ability to negotiate favorable terms.

The pipeline deal reflects a broader strategic realignment. Russia, facing restrictions on European exports due to sanctions, is redirecting vast resources toward China, its most reliable energy partner. For China, the arrangement ensures stable pipeline gas at potentially lower costs than liquefied natural gas, bolstering its energy security while maintaining bargaining power.

Industry observers suggest the project could also reshape the global gas market. If completed, Power of Siberia 2 would enhance Russia’s role as a cornerstone of China’s clean energy strategy while potentially placing pressure on global LNG suppliers.

The announcement marks a critical milestone in Eurasian energy cooperation. It signals not only the deepening of Russia-China ties but also a shift in global energy dynamics that could reverberate well beyond the region in the years ahead.