Xi Jinping again fails to give the green light for "Power of Siberia 2", despite Putin's pressure

The fifth visit of Vladimir Putin to China since the start of the war, and the 25th in his career as president, once again failed to bring Moscow the expected agreement on the construction of the "Power of Siberia 2" gas pipeline. Despite the Kremlin's claims, there is still no official confirmation from the Chinese side regarding a contract for the project.

Russian presidential spokesman Dmitry Peskov announced that Russia and China have "to a large extent" reached an agreement on the main parameters of the future gas pipeline. "The president said today during the negotiations that, in general, there is an agreement on the main parameters of 'Power of Siberia 2'. This applies both to the route and to the way it will be built," Peskov stated after Putin's meeting with Xi Jinping in Beijing. "It remains to agree on some details, but overall there is already an understanding," he added.

Regarding the timelines, Peskov was far more evasive. "There is still no clarity. This is, after all, commercial information. But it is a significant achievement," the spokesman commented, without providing specific dates for the start of construction.

Despite assurances from Moscow, the Chinese side once again did not publicly confirm that the project had been agreed upon. This is not the first instance in which the Kremlin has announced a breakthrough on the 7,000-kilometer "Power of Siberia 2," intended to connect the Chinese market with Siberian gas fields via Mongolia and effectively double Russian natural gas exports to China. For more than a decade, however, the project has remained "on hold."

In September last year, following a visit by a Russian delegation to Beijing, Gazprom CEO Alexei Miller stated – only to Russian media – that the parties had "signed a legally binding memorandum for the construction of the 'Power of Siberia 2' gas pipeline and the transit gas pipeline through the territory of Mongolia, 'Soyuz Vostok'." Even then, however, Beijing did not officially confirm his words, nothing was reported about an agreed price, and Miller did not provide details.

Now, expectations were that Putin – during his latest visit – would try once again to convince Xi Jinping to give the green light for construction. This is at least the fifth attempt in the last four years alone. The main stumbling block remains the price of gas. According to a source close to Gazprom, cited by international media, the Russian monopolist has made a "very favorable" price offer, but despite this, Beijing has not shown a readiness to move the project forward.

A person familiar with the negotiations commented to the "Financial Times" that they doubted whether the two sides would reach a deal at all, as China insists on buying gas at a price comparable to that on the domestic Russian market – about 50 dollars per thousand cubic meters. This level is highly subsidized, approximately 12 times lower than current European quotes and about five times below the price of 258 dollars per thousand cubic meters that Beijing is currently paying under existing contracts.

In Beijing, Putin arrived with an impressive delegation – five deputy prime ministers, eight ministers, and heads of key state companies, including Gazprom and Rosneft. During the visit, the Russian president spoke of the "boundless prospects" of Russian-Chinese cooperation and promised "uninterrupted" exports of oil, coal, and gas to the Chinese market.

After the talks, 40 documents were signed between the two sides. However, in the list published by the Kremlin, not a single one mentions the "Power of Siberia 2" project or new agreements in the oil and gas sector – an indirect confirmation that the pipeline remains only at the level of political rhetoric.

Pompous messages about "new heights" in relations

Chinese President Xi Jinping welcomed Vladimir Putin at the Great Hall of the People in Beijing. The two leaders agreed on the future extension of the "Treaty of Good-Neighborliness and Friendly Cooperation between China and Russia," reported the Xinhua agency.

In his speech, filled with pathos and general formulations, Xi noted that the meeting coincides with the 30th anniversary of the establishment of the strategic partnership for coordination between Beijing and Moscow and the 25th anniversary of the signing of the treaty of good-neighborliness. He emphasized that Chinese-Russian relations have developed "step by step," thanks to the "deepening of mutual political trust" and "strategic coordination with unwavering resilience."

According to Xi, the two sides are "expanding cooperation with momentum toward new heights" and "defending international justice and equity" while "promoting the building of a community with a shared future for mankind with unwavering determination."

"As permanent members of the UN Security Council and important major countries in the world, China and Russia must adopt a strategic and long-term perspective, strive for the development and revitalization of our countries through comprehensive strategic coordination with even higher quality, and work to make the global governance system more just and reasonable," Xi further stated.

He defined bilateral relations as a "comprehensive strategic partnership for coordination for a new era," based on "equality, mutual respect, good faith, and win-win cooperation." The Chinese leader called on the two states to fully implement the "important common understandings" reached between him and Putin, to take advantage of "historical opportunities," and to continue strengthening mutual trust and friendship.

For his part, Vladimir Putin described the state of bilateral ties as "unprecedented." "Our relations today have reached an unprecedented level, offering a truly global model of partnership and strategic cooperation," declared the Russian president.

Against this backdrop, however, the lack of a real contract for "Power of Siberia 2" suggests that behind the loud formulations about "new heights" and a "shared future," serious disagreements remain on key economic topics – most notably the question of at what price China is willing to buy Russian gas.