Gas Deal with China Becoming Ever Less Favorable to Russia, Morokhin Says

Paul Goble

            Staunton, June 18 – Moscow and Beijing have been discussing a pipeline to carry Russian gas to China since 2006; but they haven’t been able to reach an agreement. Worse, from Moscow’s point of view, China has continued to increase its demands on the Russian side, something it feels free to do because of Russia’s loss of other gas markets abroad.

            That trend is likely to continue unless and until Moscow can begin to sell more gas to others and thus not be forced as now to grudgingly accept Beijing’s ever more extreme demands, Denis Morokhin, the economics observer for Novaya Gazeta Evropa, says (novayagazeta.eu/articles/2024/06/18/poslednee-kitaiskoe-trebovanie).

            He suggests that China is now making demands that Moscow can hardly afford to meet including selling gas to China at domestic Russian prices, credit arrangements unfavorable to Gazprom, Chinese involvement in gas exploration inside Russia, the routing of pipelines, the amount of gas to be delivered and the formula for setting prices.

            According to Morokhin, Moscow does not want to meet any of these demands because they would effectively give China enormous power over Russia’s internal economic arrangements; but at the same time, he suggests, the Kremlin may not be able to resist much longer given the absence of other sources of money it needs for its war in Ukraine.