Putin-Xi Talks Address Stalled Gas Pipeline Amid Iran War Disruptions
The Story
Russian President Vladimir Putin met with Chinese leader Xi Jinping in Beijing on Wednesday, with the long-stalled Power of Siberia 2 natural gas pipeline on the agenda as the Iran war disrupts energy supplies. Kremlin foreign policy aide Yuri Ushakov said the project would be discussed in great detail between the leaders. The planned 2,600-kilometer pipeline would carry 50 billion cubic meters of gas annually from Russia’s Yamal fields to China via Mongolia. Pricing, financing terms, and a delivery timeline remain unresolved, with China reportedly seeking pricing near Russia’s domestic rate of around $120-130 per 1,000 cubic meters, while Moscow is seeking terms closer to the existing Power of Siberia 1 pipeline. At a joint press conference, Putin said Russia was ready to continue supplying energy to China and that there is “big potential in joint renewable energy projects.” Kremlin Press Secretary Dmitry Peskov later stated that Russia and China had “reached an understanding on the project’s main parameters” but that “some nuances remain to be ironed out” with no clear timeframe. The U.S.-Iran war that started in late February has effectively closed the Strait of Hormuz, disrupting half of China’s oil imports and nearly a third of its LNG supply, creating fresh incentives for an overland pipeline, though analysts remain skeptical that this would alter Beijing’s negotiating calculus.
Key Facts
- Putin and Xi met in Beijing on Wednesday with Power of Siberia 2 on the agenda.
- The pipeline is planned to be 2,600 km long, carrying 50 bcm of gas annually from Russia’s Yamal fields to China via Mongolia.
- A legally binding memorandum to advance construction was signed in September 2025, but pricing, financing, and delivery timeline remain unresolved.
- China reportedly wants pricing near Russia’s domestic rate of $120-130 per 1,000 cubic meters; Russia seeks terms closer to Power of Siberia 1, which analysts estimate would more than double that figure.
- China’s imports of Russian oil jumped 35% year over year in the first quarter, according to official customs data.
- Existing Power of Siberia 1 delivers about 38 bcm of gas annually to China, and both countries agreed to expand its capacity.
- Putin said talks were “friendly, warm, and constructive” with relations at an “unprecedented level.”
- Peskov said Russia and China had “reached an understanding on the project’s main parameters” but “some nuances remain” with no clear timeframe.
- The U.S.-Iran war that started late February closed the Strait of Hormuz, disrupting half of China’s oil imports and nearly a third of its LNG supply.
- China holds about 1.23 billion barrels in onshore crude inventory, sufficient for roughly 92 days of refining needs (Kpler analyst Muyu Xu).
- Russia’s gas exports to Europe collapsed after its 2022 invasion of Ukraine, with Gazprom shipments reportedly plunging 44% last year.
- Analyst Michael Feller said a deal would signal co-dependency and make the Sino-Russian relationship harder to unpick for the rest of the world.
Conflicting Reports
No conflicting reports identified in the source article.
Still Unclear
- Whether pricing, financing terms, and a delivery timeline will be finalized, and when construction might begin.
- The specific “nuances” that remain to be ironed out between Russia and China on the pipeline.
Misconceptions
No widespread misconceptions addressed in the source article.
Key Figures
- Vladimir Putin, Russian President
- Xi Jinping, Chinese leader
- Yuri Ushakov, Kremlin foreign policy aide
- Dmitry Peskov, Kremlin Press Secretary
- Muyu Xu, Kpler senior oil analyst
- Michael Feller, chief strategist at Geopolitical Strategy
- Gazprom (state-owned energy giant, mentioned but not as a named individual)
Sources: CNBC
