The loss of the EU as Russia's primary gas importer is taken up by China as an energy crunch ravages the union.
Moscow Pivots to Supply China, Replacing the EU
Beijing is predicted to surpass the European Union (EU) as the primary consumer of Russian natural gas after the Power of Siberia 2 pipeline starts up in 2030, reported Anadolu.
The pipeline is getting built to bring the Yamal reserves from west Siberia, the main line for the gas, to Europe, making it a major consumer. The bloc scrutinized it after it decided to forgo Russian oil products after the hostilities started on February 24. About ten months have led to an energy war between Russia and the west, which has impacted the price of oil and natural gas.
European countries that have imposed numerous sanctions on Russia and decided to ban Russian seaborne oil with a price cap of $60 (€57) per barrel are now discussing imposing a similar cap on Russian gas, per Euronews.
A year ago, the bloc had seen annual gas shipments from Russia from around 155 billion cubic meters (bcm) on ordinary, correlating at about 45% of its total gas imports, noted CNBC.
A limit for Russia's natural gas will be €200 per megawatt-hour, which caused arguments in the European Union between Germany, Belgium, and Poland. Berlin cautioned the move to have a limit could make Europe lose its valuable gas importer, but Belgium, Poland, and Italy saw it as a way to protect against price instability.
Now the price has settled at €130 from €340 per megawatt-hour in August, noted a Netherlands gas trading firm. On Tuesday, the Bloc will concern itself with a price cap on natural gas.
China To Be Major Importer of Russian Gas
Russia needs Europe as it did before for gas exports but is now getting Beijing to make up for that market loss; by sending its shipment to Asia instead.
Last April 14, Russian President Vladimir Putin commented that Russia would be leaving Europe for its actions, sending supplies to the east instead as the west shoots itself in the foot.
Russian Deputy Prime Minister Alexander Novak remarked last September how Russia's natural gas exports to the bloc countries during 2022 have slacked off by 50 bcm.
The Power of Siberia pipeline-1 is the only route Moscow has to transport gas to Asia, which still needs to be fully operational. Even if the pipeline sends 38 bcm of natural gas from Russia to China at maximum capacity, only about 25% of what the European Union got before the conflict will be supplied.
Another pipeline will be built that will start in 2024 and be done by 2030. The Power of Siberia 2 will add more gas. Both will have a total of 88 bcm at their maximum capacity reached.
Current exports sent to Beijing are about 10% thru pipe and LNG ships, with added upgrades coming as Russia tops as the leading gas supplier, approximately 45% of what the PRC needs. There will be more LNG terminals by 2035 to have a total of 224 million tons. China gets a chunk of the EU as Russia's top gas importer.
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