Russia Cuts Gas Price for China to Six-Year Low Amid Sanctions Pressure

The Russian government has agreed to cut the price of natural gas for China to a six-year low, according to a macroeconomic forecast by the Russian Ministry of Economic Development. The new price of $223.9 per thousand cubic meters is expected to take effect next year via the Power of Siberia pipeline, representing a 14% decrease from this year's prices and 34% lower than what other Gazprom customers in distant markets will pay.

The forecast published on May 12 shows that gas prices for China have been steadily decreasing since their peak in 2021 at $145 per thousand cubic meters. The price is expected to rise to $229.7 in 2028 and $235.6 in 2029, but the discount for Chinese buyers will remain significant at 30% and 28%, respectively.

The development comes as Russian President Vladimir Putin visits Beijing for talks with Chinese leader Xi Jinping amid international sanctions pressure and Russia's growing dependence on the Chinese market. The price cut is seen as a strategic move to strengthen ties between the two nations.