Free Republic
Browse · Search
Bloggers & Personal
Topics · Post Article

Skip to comments.

China Delivers Another Economic Blow To Russia
JDSupra ^ | 26 June 2024 | Daniel Markind

Posted on 06/28/2024 5:32:28 AM PDT by Chad C. Mulligan

When Russia invaded Ukraine in February 2022, it lost access to many world markets, including much of Europe. Countries like Germany, which for years had relied on Russian gas and oil, now turned sharply away and sought to rid themselves of any vestiges of Russian dependence. (Source)

Into the breach stepped China. Always thirsty for new supplies of gas and oil, China quickly notified Russia that it was interested in receiving Russian gas and in developing a pipeline from Siberia for that gas. (Source). Recently, however, that lifeline looks more like a noose, at least for Russia. Beijing is taking a very aggressive stance on what is to be known as the “Power of Siberia 2” pipeline, which was planned to transport a maximum annual capacity of 50,000,000 m³ of natural gas from Russia to China. (Source)

China now is demanding that it pay only Russia's heavily subsidized domestic price for the natural gas, and China will not commit to buying a substantial quantity of such gas every year. (Source) Meanwhile, Russia's state-owned oil company, Gazprom, is hemorrhaging cash. Last year, it reported a loss of $6.9 billion, its first annual loss in 20 years. (Source) Perhaps in a sign of the difficulties regarding the negotiations, Gazprom's CEO, Alexei Miller, who had been a fixture in previous Sino-Russian talks, did not accompany Russian President Vladimir Putin on a trip to Beijing in May. (Source)

The fact that China is taking such an aggressive stance in the negotiations with Russia highlights the changing power dynamics between the two countries following Russia's invasion of Ukraine in 2022. Numerous western European countries have reduced or terminated their gas and oil dependency on Russia, the Nordstream II Pipeline has been destroyed, and much of the economic relationship between Russia and the west has dissolved altogether. Without that western economic outlet, China assumed greater significance to Russia’s economic interests.

China, however, rarely allows an opportunity to extract a price to pass by. It is playing economic hardball with Russia, and Russia has little ammunition with which to fight back. Regardless of how this negotiation turns out, the Sino-Russian relationship is changing. Vladimir Putin now knows that, notwithstanding any prior claim that with China he has a "friendship without limits". (Source) Simply put, China will not inconvenience itself to help its northern neighbor. Simultaneously, Russia's economic isolation is only deepening, and Vladimir Putin may be running out of time to reverse it.


TOPICS:
KEYWORDS: china; danielmarkind; daplanedaplane; fail; fantasyisland; fullscaleinvasion; gas; gazprom; landofmakebelieve; mrrourke; naturalgas; russia; zeeperporn
Navigation: use the links below to view more comments.
first previous 1-2021-23 last
To: BobL
14. Energy prices in Europe through the roof

Let's check!

natural gas at Henry Hub (USD/MMBtu) - $2.64

NYMEX - Dutch TTF Natural Gas (USD/MMBtu) - $10.68

21 posted on 06/28/2024 8:30:28 AM PDT by kiryandil (FR Democrat Party operatives! Rally in defense of your Colombian cartel stooge Merchan!)
[ Post Reply | Private Reply | To 4 | View Replies]

To: BobL
Looks like the Ukie cheerleaders got nuttin'.

They're standing here staring into space like Brandon last night.  

22 posted on 06/28/2024 8:32:01 AM PDT by kiryandil (FR Democrat Party operatives! Rally in defense of your Colombian cartel stooge Merchan!)
[ Post Reply | Private Reply | To 10 | View Replies]

To: Chad C. Mulligan

There are several problems with this narrative.

Russia won’t build a pipeline on such conditions because it makes no sense.

China needs gas and is mostly getting it for a very high price by LNG which is also an unreliable supply.

Bottom like is that it is not expedient for China to do what the article imply.

They can afford to pay as much as Russians want.


23 posted on 06/29/2024 1:53:16 AM PDT by NorseViking
[ Post Reply | Private Reply | To 1 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-2021-23 last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
Bloggers & Personal
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson