OIES Podcast – Update on China-Russia gas relations

In this latest OIES podcast, from the China and Gas Programmes, James Henderson talks to Michal Meidan and Vitaly Yermakov about their latest comment on developments in China-Russia gas relations. The podcast starts with an overview of a number of important moves involving Chinese purchases of sanctioned Russian LNG cargoes and the signing of new pipeline gas export contracts during the recent visit of President Putin to Beijing. The purchases of LNG from the Arctic LNG-2 project are assessed for their commercial and political impact, and we consider the implications for the further development of LNG trade and the potential development of new LNG projects in Russia. From a pipeline perspective, we examine the expansion of two existing export contracts between Russia and China and look at the realistic prospect for the new Power of Siberia 2 contracts being fully realised. We discuss the potential commercial terms and their implications for Russia’s gas industry and also for China’s emerging role as an important swing buyer and seller of LNG into the global market. Finally, we discuss the geopolitical implications of these gas market developments and how we should interpret China’s apparent willingness to increase engagement with Russia while seemingly ignoring western sanctions.