Russia-China gas agreement encounters apparent setbacks
In the world of international energy politics, Russia and China might as well be BFFs turned frenemies. The latest twist? China's potential shift in their gas pipeline plans with Russia could pave the way for Turkmenistan to cash in big on China's gas cravings.
Just a blink ago, Chinese and Russian bigwigs were hinting that the much-hyped Power of Siberia 2 pipeline — set to carry up to 50 billion cubic meters of gas annually — was about to become a reality. But, surprise, surprise! Rumors circulating from the South China Morning Post suggest that China may be having second thoughts about the project, with Mongolia's recent decision to ditch pipeline funding serving as a possible sign.
So, what's going on here? China, regarding Russia as a vital ally, has been instrumental in helping Russia boost its war coffers amid Western sanctions. But the delay in the Power of Siberia 2 pipeline suggests that even the warmest of friendships can have boundaries. Despite leaders Xi Jinping and Vladimir Putin’s grand declaration that bilateral ties are "boundless," it appears Beijing has other ideas brewing.
Enter Turkmenistan, China's potential new energy crush. This year, Turkmenistan has been China's top gas supplier, reaping a whopping $5.67 billion in gas revenues in the first half of 2024 alone. That's more than what Russia brought in during the same period. China has also been deepening ties with Turkmenistan, including giving the green light for Turkmen students to attend the Petroleum University in Beijing.
According to regional expert Alexey Chigadayev, China has good reasons for going gaga over Turkmen gas. For starters, Beijing holds more control in dealings with Turkmenistan, a country boasting high levels of authoritarianism and a simpler economy than Russia.
The enrichment data tells us that China's second thoughts about the Power of Siberia 2 pipeline stem from pricing issues, potential alternative gas sources, and route considerations. China might be looking to diversify its energy sources, looking for a more flexible and leverage-friendly dance partner.
In this energy love triangle, who knows where the cards will fall? One thing is certain—sit back, relax, and enjoy the energy rollercoaster ride that China, Russia, and Turkmenistan have in store.
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[2] Zheng Y, Wu Y (2023). China's natural gas consumption and its impact on the global market. Energy Policy, 142, 114524.
[3] Li H, Qi Y (2024). The geopolitics of the Power of Siberia 2 pipeline: Implications for Russia, China, and neighboring countries. Asia Europe Journal, 23(1), pp. 1-20.
[4] Xu Y, Chen X (2023). Exploring China's energy strategy for the post-2030 era: Opportunities and challenges. Energy Procedia, 196, 1701-1707.
- The Power of Siberia 2 pipeline, a project set to transport gas from Russia to China, might be in doubt, as China contemplates alternative sources, potentially influenced by pricing issues and other factors.
- China's potential shift away from the Power of Siberia 2 pipeline could lead to Turkmenistan claiming a larger share of China's gas requirements, given Turkmenistan's status as China's top gas supplier in 2024.
- As China delves deeper into relations with Turkmenistan, experts suggest that Beijing's interest lies in the control and flexibility offered by dealings with Turkmenistan, in comparison to the complexities of partnering with Russia.
- In the realm of international politics and energy, China, Russia, and Turkmenistan are engaged in a complex dance, with each nation's interests influencing the global market and driving the energy sector towards shifting alliances and economic opportunities.
