WSJ: China seeks record-low Russian gas price for Power of Siberia 2
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The Wall Street Journal reports that China is ready to support the construction of the Power of Siberia 2 pipeline only if the gas price is around $50 per thousand cubic meters. This is roughly eight times lower than the average price for other buyers, potentially requiring Russia to subsidize the project.
The Price Demand
According to the WSJ, China is demanding a price of approximately $50 per thousand cubic meters for Russian gas delivered via the planned Power of Siberia 2 pipeline. This is a fraction of the $258.8 average China currently pays for Russian gas, which is already 39% below the price for other distant foreign buyers. The proposed tariff is roughly eight times lower than the average price for other customers.
Russian Forecasts
Russia's Ministry of Economic Development projects that the price for China will decline to $223.9 per thousand cubic meters by 2027, still 34% below other external markets. Even at that level, the discount is far smaller than the $50 China is seeking. The WSJ suggests that meeting China's demand could mean Russia effectively subsidizing the project.
Diplomatic Context
Vladimir Putin visited China on May 19-20 and held talks with Xi Jinping, signing several cooperation documents. However, the Kremlin did not announce any specific agreements on Power of Siberia 2. The pipeline, which would carry gas from Russia's Yamal region to China, has been under negotiation for years without a final deal.
What's Next
Further negotiations are expected, but no new talks have been scheduled. It remains unclear whether Russia will accept the steep discount or if the project will proceed without a price agreement.
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WSJ: China seeks record-low Russian gas price for Power of Siberia 2
