Latest news with #PowerOfSiberia2
Russia Today
7 days ago
- Business
- Russia Today
China warming to new Russian mega gas pipeline
China's interest in the construction of Russia's proposed Power of Siberia 2 pipeline, which would deliver gas via Mongolia, has intensified following the outbreak of the conflict between Iran and Israel, the Wall Street Journal reported on Tuesday, citing sources in Beijing. The planned mega pipeline would allow up to 50 billion cubic meters (bcm) of natural gas to be delivered annually from northern Russia to China via Mongolia. The report said that the recent Iran-Israel conflict has raised concerns within the Chinese government about the reliability of oil and gas supplies from the Middle East, prompting policymakers to explore alternative energy sources. China imports about 30% of its gas as LNG from Qatar and the UAE through the Strait of Hormuz – a route for about 20% of the world's oil – which Iran has threatened to close in response to the US strikes. Chinese 'teapot' refineries have also grown reliant on discounted Iranian crude, with analysts estimating that over 90% of Tehran's oil exports now go to China – despite US sanctions aimed at curbing the country's oil sales abroad. 'The escalation of the Middle East tensions underscores the severe consequences of a potential blockade in the Strait of Hormuz,' Wei Xiong, head of China gas research at Rystad told the outlet. A blockade of the chokepoint could trigger a major shift in Beijing's LNG supply, with the country 'moving from being over-contracted to supply deficit.' Even with a ceasefire, the recent conflict has prompted Beijing to seek alternative energy sources, according to analysts and officials. China is also looking to increase oil imports from Russia, which already supplies about a fifth of its crude to its neighbor. Moscow, in turn, is pursuing the project as it seeks to diversify its energy export markets amid Western sanctions and reduced European demand. The Power of Siberia 2 pipeline is seen in Beijing as a strategic move to further diversify supplies and strengthen energy security in the face of rising geopolitical uncertainty, the report says. 'The volatility and unpredictability of the military situation have shown the Chinese leadership that a stable land-based pipeline supply has geopolitical benefits,' the outlet cited Aleksander Gabuev, the director of the Carnegie Russia Eurasia Center and an expert on China-Russia relations, as saying. 'Russia could benefit from that.' China is seeking closer ties with Russia as the White House signals efforts to drive a wedge between the two nations, according to sources familiar with Beijing's policymaking. Economic cooperation has continued to grow despite sweeping Western sanctions, with bilateral trade reaching a record $245 billion in 2024.
Yahoo
7 days ago
- Business
- Yahoo
Iran-Israel War Prompts China to Reconsider Russia's Gas Pipeline Proposal
The war between Israel and Iran has spark worry about energy supply security in Beijing, and a greater interest in the Power of Siberia 2 pipeline—a project proposed by the Russian side, on which the Chinese side has been in no hurry to make a decision. The Wall Street Journal reported the news, citing unnamed sources close to the government in Beijing. The latter has been in two minds about the Power of Siberia 2, first, because it has been hard to agree with the Russian side on things like ownership and pricing and second, because China does not want to become over-reliant on a single source of oil and gas. Now, these concerns appear to have taken the back seat in the face of a fresh dose of Middle Eastern instability and energy supply uncertainty—especially in gas. Almost a third of China's gas imports come as LNG from Qatar and the United Arab Emirates, the WSJ noted in its report, citing Rystad Energy figures. Russia, in turn, is China's third-largest supplier of LNG, after Australia and Qatar. But it is China's biggest pipeline supplier, via the Power of Siberia 1, with flows this year set to reach 38 billion cu m, according to S&P Global. This is the maximum capacity of the Power of Siberia 1, but the POS 2 will have a capacity of 50 billion cu m. This is a lot of gas with no geopolitical risk that could lead to spikes in prices. As for diversification, China also imports quite a lot of natural gas via pipeline from Turkmenistan. Russia also appears set to benefit from the risk to oil supply from the Middle East and more specifically Iran, the WSJ report suggested. China, which is essentially the only buyer of Iranian crude, is now reconsidering this reliance as well, following the latest developments in the Middle East. One way of reducing said reliance is by boosting oil purchases from Russia, according to analysts. Russia currently accounts for some 20% of China's oil consumption. By Irina Slav for More Top Reads From this article on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Zawya
17-06-2025
- Business
- Zawya
Israel-Iran conflict will spur Russia-China gas deal, Russian adviser says
Rising tensions in the Middle East will accelerate natural gas negotiations between Russia and China, with a decision likely this year, the head of a think-tank that advises the Russian government on China told Reuters. Russia has been seeking a deal to build the Power of Siberia-2 pipeline to deliver 50 billion cubic metres of gas a year to China, but the two sides have not been able to agree on terms. "With the sharp rise in tensions in the Middle East, it is advantageous for China to increase supplies from the north," said Kirill Babaev, head of the China and Contemporary Asia Institute in Moscow. Israel and Iran attacked each other for a fifth straight day on Tuesday, raising the risk of further unrest and the potential disruption of oil and gas supplies from the Middle East. "The issue of the gas deal will arise again because this deal is capable of guaranteeing China an uninterrupted supply of energy. Under current conditions, by the end of the year, we will see a decision on the Power of Siberia-2," Babaev added. Russian President Vladimir Putin is set to travel to China in early September to participate in celebrations marking the anniversary of the victory over Japan in World War II. The trip follows Chinese President Xi Jinping's visit to Moscow in May. Babaev, whose think tank is involved in preparing Putin's agenda, said that the visit will be filled with political and economic discussions. Economic cooperation with China has helped Russia in the face of Western sanctions imposed after its 2022 invasion of Ukraine. MUTUAL UNDERSTANDING Trade between Russia and China jumped by 26% in 2023 though by just 1.9% in 2024. It fell by 7.5% in the first four months of 2025 but Babaev said that new energy and agriculture export deals could revive growth this year. He said problems with cross-border payments, caused by the threat of secondary Western sanctions against Chinese banks, which strained relations between Russia and China in 2024, have eased. "We have a mutual understanding with our Chinese partners that money prefers silence. The less publicity surrounds these matters, the more successfully these payments proceed. The Chinese side is cooperating with us, and new mechanisms are working fine," Babaev said. A delegation of Chinese officials and executives will attend the St. Petersburg Economic Forum, Russia's main economic conference, this week and participate in a panel discussion with Putin. Babaev said that Chinese investors are active in the agriculture, oil and gas processing, food, logistics, and pulp and paper sectors, but they often operate through intermediaries, and their presence is not always reflected in statistics. "Chinese investors are entering the Russian market very cautiously and try not to make their presence too visible by establishing joint ventures with Russian companies and operating under new brands," he said. (Reporting by Gleb Bryanski)
Yahoo
17-06-2025
- Business
- Yahoo
Israel-Iran conflict will spur Russia-China gas deal, Russian adviser says
By Gleb Bryanski MOSCOW (Reuters) -Rising tensions in the Middle East will accelerate natural gas negotiations between Russia and China, with a decision likely this year, the head of a think-tank that advises the Russian government on China told Reuters. Russia has been seeking a deal to build the Power of Siberia-2 pipeline to deliver 50 billion cubic metres of gas a year to China, but the two sides have not been able to agree on terms. "With the sharp rise in tensions in the Middle East, it is advantageous for China to increase supplies from the north," said Kirill Babaev, head of the China and Contemporary Asia Institute in Moscow. Israel and Iran attacked each other for a fifth straight day on Tuesday, raising the risk of further unrest and the potential disruption of oil and gas supplies from the Middle East. "The issue of the gas deal will arise again because this deal is capable of guaranteeing China an uninterrupted supply of energy. Under current conditions, by the end of the year, we will see a decision on the Power of Siberia-2," Babaev added. Russian President Vladimir Putin is set to travel to China in early September to participate in celebrations marking the anniversary of the victory over Japan in World War II. The trip follows Chinese President Xi Jinping's visit to Moscow in May. Babaev, whose think tank is involved in preparing Putin's agenda, said that the visit will be filled with political and economic discussions. Economic cooperation with China has helped Russia in the face of Western sanctions imposed after its 2022 invasion of Ukraine. MUTUAL UNDERSTANDING Trade between Russia and China jumped by 26% in 2023 though by just 1.9% in 2024. It fell by 7.5% in the first four months of 2025 but Babaev said that new energy and agriculture export deals could revive growth this year. He said problems with cross-border payments, caused by the threat of secondary Western sanctions against Chinese banks, which strained relations between Russia and China in 2024, have eased. "We have a mutual understanding with our Chinese partners that money prefers silence. The less publicity surrounds these matters, the more successfully these payments proceed. The Chinese side is cooperating with us, and new mechanisms are working fine," Babaev said. A delegation of Chinese officials and executives will attend the St. Petersburg Economic Forum, Russia's main economic conference, this week and participate in a panel discussion with Putin. Babaev said that Chinese investors are active in the agriculture, oil and gas processing, food, logistics, and pulp and paper sectors, but they often operate through intermediaries, and their presence is not always reflected in statistics. "Chinese investors are entering the Russian market very cautiously and try not to make their presence too visible by establishing joint ventures with Russian companies and operating under new brands," he said.
Reuters
17-06-2025
- Business
- Reuters
Israel-Iran conflict will spur Russia-China gas deal, Russian adviser says
MOSCOW, June 17 (Reuters) - Rising tensions in the Middle East will accelerate natural gas negotiations between Russia and China, with a decision likely this year, the head of a think-tank that advises the Russian government on China told Reuters. Russia has been seeking a deal to build the Power of Siberia-2 pipeline to deliver 50 billion cubic metres of gas a year to China, but the two sides have not been able to agree on terms. "With the sharp rise in tensions in the Middle East, it is advantageous for China to increase supplies from the north," said Kirill Babaev, head of the China and Contemporary Asia Institute in Moscow. Israel and Iran attacked each other for a fifth straight day on Tuesday, raising the risk of further unrest and the potential disruption of oil and gas supplies from the Middle East. "The issue of the gas deal will arise again because this deal is capable of guaranteeing China an uninterrupted supply of energy. Under current conditions, by the end of the year, we will see a decision on the Power of Siberia-2," Babaev added. Russian President Vladimir Putin is set to travel to China in early September to participate in celebrations marking the anniversary of the victory over Japan in World War II. The trip follows Chinese President Xi Jinping's visit to Moscow in May. Babaev, whose think tank is involved in preparing Putin's agenda, said that the visit will be filled with political and economic discussions. Economic cooperation with China has helped Russia in the face of Western sanctions imposed after its 2022 invasion of Ukraine. Trade between Russia and China jumped by 26% in 2023 though by just 1.9% in 2024. It fell by 7.5% in the first four months of 2025 but Babaev said that new energy and agriculture export deals could revive growth this year. He said problems with cross-border payments, caused by the threat of secondary Western sanctions against Chinese banks, which strained relations between Russia and China in 2024, have eased. "We have a mutual understanding with our Chinese partners that money prefers silence. The less publicity surrounds these matters, the more successfully these payments proceed. The Chinese side is cooperating with us, and new mechanisms are working fine," Babaev said. A delegation of Chinese officials and executives will attend the St. Petersburg Economic Forum, Russia's main economic conference, this week and participate in a panel discussion with Putin. Babaev said that Chinese investors are active in the agriculture, oil and gas processing, food, logistics, and pulp and paper sectors, but they often operate through intermediaries, and their presence is not always reflected in statistics. "Chinese investors are entering the Russian market very cautiously and try not to make their presence too visible by establishing joint ventures with Russian companies and operating under new brands," he said.
