Key idea. Beijing has moved Russia’s Power of Siberia-2 pipeline closer to reality and signaled its willingness to receive LNG from the sanctioned Arctic LNG-2 project. Together, these steps tighten the Russia–China energy bond, reduce China’s need for U.S. LNG, and undercut the “U.S. energy dominance” strategy that President Donald Trump declared on his first day in office. According to Bloomberg, Beijing’s moves reflect both economic calculation and a geopolitical message to Washington.
Beijing changes its tone: Power of Siberia-2 gets moving
After years of pauses and cautious language about Power of Siberia-2, China has effectively opened a green corridor for the project. Gazprom called the new understandings “binding,” while Beijing’s official releases chose broader, umbrella phrasing about “energy cooperation.” The package also includes expanded capacity on other routes into China.
Yes, the details remain hazy: the Chinese side isn’t confirming every nuance, and only one LNG cargo has so far been recorded at Beihai port. China is also unlikely to abandon its strategy of supplier diversification. But the Russia–China “knot” has plainly been pulled tighter.
“The geopolitical message is significant,” said Michal Meidan, head of China research at the Oxford Institute for Energy Studies. “Russia needs buyers for its gas and has long talked up the pivot east; this is a significant outlet for its gas. China is hedging against its exposure to U.S. LNG and to U.S. financial trading architecture.”
According to Bloomberg, President Vladimir Putin’s visit to China and the agreements reached in Beijing delivered the project a burst of political momentum—one of the most striking energy outcomes of the trip.
What Power of Siberia-2 means for the market
For Moscow, the pipeline is a chance to replace the exports to Europe that all but vanished after 2022; for Beijing, it strengthens bargaining power and lowers price risks. By BloombergNEF’s estimates, factoring in expansions on existing pipelines, China could potentially forgo the equivalent of over 40 million tons of LNG per year—more than half of the nation’s total LNG imports last year.
Gazprom is not naming a start date. BNEF considers “after 2030” a realistic horizon. Bernstein analysts warn of a market shake-up:
“Given that China is the largest importer of LNG, this would turn the LNG market on its head… For LNG projects that are still being contemplated, this would be a big negative.”
Bernstein calculates that by the early 2030s, Russian gas could cover up to 20% of China’s needs, versus roughly ~10% today. That implies a lower requirement for additional U.S. LNG volumes.
Tariffs, Hormuz, and the “high-price policy”
According to Bloomberg, Beijing’s decision to line up more Russian gas (or at least keep that option open) didn’t happen in a vacuum:
- rising tensions around the Strait of Hormuz, a key artery for LNG shipments;
- the lingering effect of elevated prices after the war in Ukraine;
- the tariff war—sweeping duties imposed by President Donald Trump and reciprocal measures by President Xi, including levies on U.S. LNG.
A telling detail: for more than six months, China has not taken any U.S. LNG cargoes—the longest pause since the previous round of trade confrontation during President Donald Trump’s earlier term.
Negotiating positions: price, flexibility, underutilization risk
The key to Power of Siberia-2 lies in commercial terms. Experts expect Moscow will have to accept low prices, close to domestic Chinese levels, and soft volume commitments that raise the risk of an underutilized pipeline.
“That means profitability is questionable, but for Moscow, showing it still has a large, long-term export outlet matters more than margins,” notes Tatiana Mitrova of Columbia University’s Center on Global Energy Policy.
For Beijing, maximum flexibility is paramount—preserving the ability to “pick and choose” with the market, especially as the European Union aims to effectively ban imports of Russian gas by the end of 2027. In this logic, Power of Siberia-2 becomes the single largest “pipe” for gas imports into China—and an insurance policy against external shocks.
A signal to Washington: “We don’t need additional U.S. LNG”
The principal political subtext, as Bloomberg points out: Beijing is demonstrably reducing its reliance on U.S. LNG.
“It signals Beijing’s intent to hedge against reliance on U.S. LNG, especially in the context of worsening U.S.–China relations,” Mitrova emphasizes.
For the White House and American LNG developers, that’s a warning sign: future Chinese contracts—the anchor demand for new projects—may be in doubt.
Arctic LNG-2: stress-testing the sanctions regime
Just as telling was the maritime episode: the first tanker from the sanctioned Arctic LNG-2 project (Novatek) discharged in China. This is effectively a test of the Trump administration’s willingness to crack down on such shipments.
Since the project was blacklisted in late 2023, Novatek struggled to place cargoes—even with the use of a “dark fleet,” whose ownership and movements are harder to track. According to accounts cited by Bloomberg, Chinese state companies were cautious, even as they heard arguments that sanctions could be adjusted as part of broader diplomacy.
The situation shifted in mid-August, when, according to Bloomberg’s sources, at a meeting in Alaska President Donald Trump and Vladimir Putin briefly touched on potential cooperation with Novatek on Arctic projects. Within hours, several vessels carrying Arctic LNG-2 output set course for China, where one cargo—the Arctic Mulan—was received in the southern port of Beihai. Choosing a secondary port appeared to be an attempt to minimize risk in case of U.S. retaliation.
There were no official comments from Novatek or port operator PipeChina. The U.S. Treasury declined to comment, and the administration of President Donald Trump has not yet publicly responded to the latest gas moves.
A gas “reshuffle” in Asia
The combined effect of recent steps, according to Bloomberg:
- Beijing boosts its bargaining power and diversification, hedging against price and political shocks.
- Moscow gets a showcase for its “pivot to the East,” even at the cost of a potentially weak project economics.
- The global LNG market enters a phase of reassessment—especially for projects still on the drawing board, which will find it harder to justify investment without China as anchor demand.
“Given that China is the largest importer of LNG, this would turn the LNG market on its head… For LNG projects that are still being contemplated, this would be a big negative,” Bernstein concludes.
Takeaway for the U.S.: China is signaling it can meet future demand growth without additional U.S. LNG—an explicit challenge to Washington’s export agenda.
This article was prepared based on materials published by Bloomberg. The author does not claim authorship of the original text but presents their interpretation of the content for informational purposes.
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