China demands domestic prices for Russian gas pipeline, sources say

Russian President Vladimir Putin's recent trip to China, intended to secure a crucial energy deal for the "Power of Siberia 2" gas pipeline, concluded without an agreement. Sources indicate that China's stance significantly shifted the power dynamic in the energy negotiations.

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Gazprom's leadership made it clear that they would only agree to the pipeline if Russia sold them gas at the same price (below market price) that Moscow sells gas domestically.

During the meeting with Xi Jinping, Putin publicly signaled expectations of a major energy accord. However, Chinese officials reportedly informed Gazprom's leadership that they would only approve the pipeline if Russia supplied gas at the same price it sells domestically, a price lower than the market rate. This effectively asked the Kremlin to subsidize the project, a demand that stalled the deal.

Furthermore, Chinese officials allegedly instructed their Russian counterparts to cease raising the pipeline issue until circumstances improve. This directive, coupled with Putin's departure from Beijing after signing 42 other agreements but no pipeline deal, highlights Beijing's leverage. Joerg Wuttke, a businessman with extensive experience in Sino-Russian relations, described the encounter as an emperor receiving a guest in his palace, implying China's dominant role.

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Chinese officials told the Russians that they should not raise the issue of the pipeline again until the conditions change.

The article suggests that while the strategic partnership between Russia and China appears stable, the war in Ukraine has solidified China's leading position. This conflict has created a situation where China holds considerable sway, transforming a once near-equal partnership into one where China is the clear dominant force in most aspects.

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Xi Jinping received V. Putin as an emperor receives a guest in his castle and sent him home.