Why China Still Won’t Approve Russia’s Power of Siberia 2 Gas Pipeline

For Moscow, the project is critical. Since the 2022 invasion of Ukraine and subsequent Western sanctions, Russia has lost much of its European gas market and is trying to redirect exports toward Asia.

The Kremlin also hoped global energy disruptions—such as tensions affecting Middle East shipping routes including the Strait of Hormuz—would encourage China to prioritize secure overland gas supplies. But these geopolitical arguments did not overcome China’s commercial concerns.

The Core Obstacle: Gas Pricing Disputes

The biggest barrier remains price.

China is believed to be seeking gas prices closer to the heavily discounted rates Russia offers domestically or to certain export partners. Russia, however, needs higher revenues to justify the multibillion‑dollar pipeline and compensate for lost European sales.

Because the two sides have not agreed on long‑term pricing and supply terms, negotiations have repeatedly stalled even when political relations appear strong.

Why China Is Hesitant About a Long‑Term Gas Commitment

Another major factor is the structure of pipeline gas deals.

A project like Power of Siberia 2 requires decades‑long purchase commitments. China has been cautious about signing new long‑term Russian energy contracts or investing heavily in Russian upstream projects since the Ukraine war began.

From Beijing’s perspective, locking in large volumes of pipeline gas could become risky if energy demand patterns change or if gas prices fall globally. A pipeline is fixed infrastructure—once built, the buyer is effectively tied to it for decades.

China Has Many Energy Alternatives

China’s negotiating confidence comes from its diversified energy strategy.

The country already imports gas from multiple sources and continues expanding domestic production and LNG purchases. Global LNG supply is expected to grow significantly in the coming years, potentially improving availability and lowering prices for buyers like China.

At the same time, China is rapidly scaling renewable energy. Wind and solar already dominate new electricity capacity additions, with hundreds of gigawatts of renewable power added in recent years.

Together, these trends reduce the urgency for China to commit to another giant fossil‑fuel import project unless the price is especially favorable.

Trade and Energy Ties Are Still Growing

The lack of a pipeline deal does not mean the economic relationship is weakening.

China and Russia continue to expand trade and energy cooperation. Bilateral trade grew 14.8% year‑on‑year in the first quarter of 2026, reaching more than $61 billion.

Russia also remains a major supplier of discounted oil and energy commodities to China, helping sustain economic links even under Western sanctions.

What the Stalemate Reveals About the China–Russia Relationship

The stalled pipeline illustrates an increasingly uneven balance in the partnership.

Russia urgently needs new energy markets and infrastructure to replace lost European demand. China, by contrast, has multiple supply options and a rapidly evolving energy system.

That imbalance means Beijing can take a slow, transactional approach—purchasing Russian energy when it is advantageous but refusing to accept unfavorable terms on large strategic projects.

In short, the Beijing summit confirmed that China and Russia remain politically aligned and economically connected. But when it comes to a $50‑plus‑billion pipeline and decades of gas purchases, China’s economic calculus still outweighs geopolitical symbolism.