Russian President Vladimir Putin is once again pressing Chinese leader Xi Jinping to greenlight the long-delayed Power of Siberia-2 natural gas pipeline. Despite multiple high-level meetings and a renewed push at the SCO summit in Bishkek, deep disagreements over pricing continue to stall the multi-billion-dollar energy project.
The Bishkek Summit Push and the Continuing Stalemate
Meeting on Monday at the SCO summit in Bishkek, Putin and Xi Jinping addressed the transit project, which has been under discussion for more than a decade and was originally slated to begin construction two years ago.
The pipeline forms a cornerstone of Moscow’s strategy to pivot its massive gas exports eastward. Kremlin officials anticipate that the project will drive a twofold increase in gas deliveries to China. Ahead of the talks, presidential aide Yuri Ushakov confirmed to reporters that bilateral energy cooperation remained central to the agenda.
According to Ushakov, Putin also scheduled discussions with Chinese Vice Premier Ding Xuexiang, who leads the intergovernmental commission on energy cooperation. Despite this high-level diplomatic engagement, the talks stopped short of a definitive construction agreement, mirroring the outcome of previous summits.
Disagreements Over Pricing and Subsidized Imports
The core barrier to moving forward remains an intractable dispute over pricing. While Moscow seeks lucrative long-term supply contracts, reports from financial publications indicate that Beijing is demanding rates close to Russia’s domestic prices—roughly $50 per thousand cubic meters.
That figure stands in stark contrast to existing trade arrangements. The original Power of Siberia pipeline, launched in 2019, operates with a steep discount, pricing gas at $258.8 per thousand cubic meters this year—some 39% lower than what Gazprom charges other distant foreign clients, who pay $420.2.
Ministry of Economic Development materials indicate that export costs to China will drop further next year to $223.9 per thousand cubic meters. Even with those concessions, Chinese officials reportedly pressed the Russian delegation during earlier visits to halt pushing for the new pipeline until Moscow is willing to restructure its pricing model, effectively asking for heavily subsidized gas imports.
Past Diplomatic Declarations Versus Public Silence
The trajectory of the Power of Siberia-2 project has been marked by optimistic announcements from Russian officials that fail to materialize in joint communiqués.
However, Beijing never publicly confirmed those statements. When the two nations signed 42 separate bilateral documents during that diplomatic trip, neither the pipeline nor natural gas commerce appeared in any of the official texts.
A similar pattern emerged during subsequent high-level delegations. Press secretary Dmitry Peskov acknowledged after talks in Beijing that fundamental understandings and routing were settled, but emphasized that minor nuances and concrete timelines remained open.
Some nuances are left to negotiate. Dmitry Peskov, Press Secretary of the Russian President
Extensive Business Delegations and Unmentioned Energy Pacts
Putin arrived in Beijing accompanied by a massive delegation comprising five vice premiers, eight ministers, and the heads of major state-owned enterprises, including energy giants Gazprom and Rosneft. Throughout the visit, officials promoted limitless bilateral cooperation and pledged uninterrupted exports of oil, coal, and gas to the Chinese market.
Yet, the official output of those high-stakes meetings again underscored the diplomatic friction. Delegations signed 40 documents, none of which mentioned the Power of Siberia-2 pipeline or new joint hydrocarbon ventures. Financial analysts note that Beijing currently pays roughly $258 per thousand cubic meters under existing agreements—dramatically lower than the $420 charged to other international buyers—making the steep additional discounts demanded for the second pipeline economically unviable for Gazprom without major state intervention.
Upcoming Economic Forums and Unresolved Stakes
With negotiations remaining gridlocked over financial terms, the energy initiative is slated to return to the diplomatic table immediately. Ushakov indicated that the pipeline discussions will likely carry over to the Eastern Economic Forum scheduled for September 1–4 in Vladivostok, which will host the 8th Russia-China Energy Business Forum.
