Russia-China plan oil expansion

Oil and gas are the core of the Russia-China relationship now — not the whole thing, but the part that pays the bills. That matters because Russia lost most of its European energy market after invading Ukraine, and China became the biggest alternative buyer. The gap has been obvious for years: Moscow wants more long-term Chinese demand, especially through pipelines, while Beijing wants cheap, secure supply without becoming too dependent on Russia. What changed this week is that Vladimir Putin said on May 9 that the two sides are nearing a new “breakthrough” in oil and gas cooperation, after another round of high-level diplomacy in April and around Victory Day in Moscow. ### What actually happened? Putin used post–Victory Day remarks in Moscow to say Russia and China are approaching a major new step in oil and gas cooperation. That is not a signed megadeal yet. But it is a public signal from the Kremlin that energy talks moved high enough to be advertised as one of the next big items in the relationship. (easternherald.com) ### Why now? The timing is pretty straightforward. Sergey Lavrov said in Beijing on April 15 that Russia was ready to increase energy supplies to China, and he tied that offer to wider market disruption in the Middle East. In plain English — Moscow sees a chance to pitch itself as the more reliable overland supplier while Asian buyers worry about maritime chokepoints. (easternherald.com) ### What is the “breakthrough” likely to be? The obvious candidate is more gas infrastructure, especially the long-delayed Power of Siberia 2 pipeline. That project would move gas from West Siberia to China through Mongolia, and its planned capacity is about 50 billion cubic meters a year. It has been stuck for years over price, financing, and how much control China wants. So when Russian officials talk about a breakthrough, they are probably pointing to movement on terms, volumes, or timing rather than some totally new idea. (mid.ru) That last part is an inference — but it fits the pattern of recent statements. ### Why is China so careful? Because leverage matters. China likes Russian energy, but it likes optionality more. MERICS notes that Russia’s lack of alternative markets leaves Moscow negotiating from weakness, while China keeps diversifying supply and building domestic alternatives. Basically, Beijing wants the discount and the security benefit without handing Russia permanent pricing power or letting one supplier dominate its system. (rferl.org) ### What about oil, not just gas? Oil is already the bigger, real-world story. Russia remained China’s largest crude supplier through 2025 even as flows got bumpier under sanctions pressure. S&P Global put Russian deliveries to China at 2 million barrels a day in the first 10 months of 2025, down 7.7% year over year. Columbia’s Center on Global Energy Policy also notes Russia was still one of the five countries supplying 62% of China’s crude imports in 2025. (merics.org) So the relationship is not hypothetical — it is already massive. ### Why do sanctions make this harder — and more important? Because sanctions did not stop the trade. They changed its plumbing. Russian barrels now move through more complicated shipping, insurance, payment, and discount arrangements. That makes China more valuable to Russia, not less. It also means any expansion in direct pipelines or long-term contracts would reduce some of the friction Western pressure created. (spglobal.com) ### Does this mean a done deal? Not yet. The catch is that Russia has been talking up bigger energy ties with China for a long time, and Beijing has repeatedly slowed or reshaped those plans to get better terms. Even analysts who see fresh momentum still describe Power of Siberia 2 as “on the table,” not locked in. ### Bottom line? (merics.org) This story is less “surprise new alliance” and more “the next stage of an existing dependence.” Russia needs China’s market. China likes Russia’s supply, but on China’s terms. If a real breakthrough lands, it will tell you one thing above all — Beijing decided the security value of more Russian energy now outweighs the bargaining advantage of waiting. (mid.ru) (rferl.org)