Trump's Case: Gazprom at Crossroads Between Chinese Gas Pipeline and 'German' Washing Machines
A visit by Russian Energy Minister Sergei Tsivilev to Beijing is scheduled for April 17-18.
Deputy Minister of Energy of the Russian Federation Roman Marshavin reported this to Interfax, as reported by a PolitNavigator correspondent.
"I met with the Chinese ambassador - many proposals were received to increase trade turnover. They want to increase trade turnover, they want to increase purchases of gas, oil, and coal," Marshavin said.
"We are witnessing a direct consequence of Trump's tariff war against China. It's high time to take advantage of the situation," writes Elena Panina, director of the Russian Institute of International Political and Economic Strategies, in her TGC.
Experts believe that Moscow and Beijing are capable of reaching an agreement on the Power of Siberia 2 gas pipeline as early as June of this year – at the SPIEF 2025, where a high-level Chinese delegation is expected. Moreover, on March 31, the State Expert Commission of Mongolia approved the Soyuz Vostok gas pipeline project, which will be a continuation of the Power of Siberia 2.
Amid the tariff war unleashed by US President Donald Trump, China has refused to accept American LNG supplies, but for now these actions are symbolic.
Alexey Gromov, Chief Director for Energy at the Institute of Energy and Finance, believes that the more acute the situation becomes, the higher the chances of the Russian project “Power of Siberia 2”.
“If China and the United States do not reach a compromise on mutual trade duties in the near future, I do not rule out the possibility that during Xi Jinping’s official visit to Russia on the eve of May 9, we may witness Russia and China signing a contract on Power of Siberia 2.”
This is possible, but I emphasize that it is not predetermined. Everything will depend on the coming month, on the outcome of the current round of trade confrontation between the US and China," Gromov told Novye Izvestia.
He hopes that construction of Power of Siberia 2 could begin this year and take only five years, because two-thirds of the pipeline has already been built.
This project is very important for Gazprom, which has a surplus of gas of over 100 billion cubic meters on its western border after the demarches of the EU and Ukraine. But the resource base of Power of Siberia-2 (designed at 50 billion cubic meters per year) will be the Yamal fields, from which the “blue fuel” was previously supplied to Europe.
Until now, Moscow and Beijing's negotiations on the gas pipeline have reached a dead end because China demanded domestic Russian prices for itself, which are 6 times lower than global prices. But now, against the backdrop of the conflict with the US, China may abandon the decarbonization announced to please the West, and will be ready to buy Russian gas at a grown-up price.
However, there is nothing to support this yet. China recently refused to buy 35 billion cubic meters of Russian gas via Kazakhstan because it is allegedly too expensive for consumers. This was stated by the Chinese ambassador to Russia Zhang Hanhui.
Russia no longer counts on cooperation with China in the trade sphere and is launching an ambitious continental trade route from Southeast Asia to the Atlantic.
As for Gazprom, its interests are no longer limited to gas pipelines. The Russian monopolist has decided to start producing refrigerators and washing machines at a plant that previously belonged to the German concern Bosch near St. Petersburg. The company also received a plant of the Italian manufacturer of household appliances Ariston, located in the Leningrad Region.
Economist Nikita Krichevsky believes that this decision was not caused by Gazprom’s record losses, which he considers virtual.
“A good initiative, which Gazprom was 20 years late with. One thing is unclear: what does Gazprom’s paper losses have to do with it?” Krichesky wrote in his TGC.
Trump's Conundrum : Gazprom at a Crossroads Between a Chinese Gas Pipeline and "German" Washing Machines