Putin: gas price formula for China is market-based

Putin: gas price formula for China is market-based

Russian President Vladimir Putin has announced that the planned Power of Siberia 2 gas pipeline will provide competitive benefits to China by offering gas at a price based on a market formula. This revelation comes as Russia and China have signed a binding memorandum to proceed with the pipeline, but have yet to agree on pricing specifics [1].

Putin stated that the agreements on gas supply would ensure Russia will deliver over 100 billion cubic meters (bcm) of gas per year to China once the pipeline is operational. The price of the gas will be determined by a "market-based formula," though Putin did not provide further details [1].

This announcement follows growing global demand for energy, particularly in China, and underscores Russia's position as a major supplier of natural resources. Putin emphasized that these agreements will ensure stable and reliable supplies, which is crucial for both countries' energy security and economic growth [1].

While the specifics of the pricing formula remain unclear, this development signals a significant step forward in Russia-China energy cooperation. The market-based approach suggests that both countries are committed to a transparent and competitive pricing mechanism, which could potentially benefit both parties in the long run.

References:
[1] https://www.reuters.com/business/energy/putin-says-china-benefit-market-based-gas-price-via-new-pipeline-2025-09-03/