Russia was always going to struggle to redirect the 180bn cubic metres (bcm) of gas, worth 80% of its total exports of the fuel in 2021, that it once sold to Europe. The country has no equivalent to Nord Stream, a conduit to Germany, that allows it to pipe gas to customers elsewhere. It also lacks plants to chill fuel to -160°C and the specialised tankers required to ship LNG. Until recently, this was only a minor annoyance. Between 2018 and 2023 just 20% of the total contribution of hydrocarbon exports to the Russian budget came from gas, and despite sanctions Russia continues to sell lots of oil at a good price.

But as the conflict grinds on, the Kremlin needs cash to keep its war machine going. High oil prices will not last for ever, either. The world’s production capacity surpasses global demand; only output cuts by Gulf producers and allies, including Russia, are keeping markets tight. A shortage of funds and equipment is hampering Russia’s efforts to explore new fields. Global demand could ebb further still in years to come. The International Energy Agency, an official forecaster, expects it to peak this decade, as the green transition gears up. In contrast, most forecasters predict demand for gas, a cleaner fuel, to continue climbing.

For Russia, all this makes reviving gas sales important. Unfortunately, exports to Europe, which still accounted for half the 140bcm the country exported last year, will shrink again this year. In theory, Russia now has two options: building pipelines to other places or turbocharging LNG exports.

Siberian express

Russia is already making more use of Power of Siberia, a pipeline that links eastern gasfields, which never served Europe, to China. By 2025 deliveries may reach 38bcm, up from 10bcm in 2020; an extension could carry another 10bcm a year by 2029. But the game-changer would be Power of Siberia 2, a proposed line from Russia’s west to China that would carry 50bcm a year by 2029. By then, China’s demand is projected to hit 600bcm, up from 390bcm last year. Russia hopes to supply a sixth of that.

The problem is that China is not sure it really wants Power of Siberia 2. Obsessed about energy security, its leaders have long sought to limit reliance on any single fuel exporter. Negotiations with Russia over the project have stalled, with disagreements remaining over crucial contract terms, from financing to the price of gas.

Even if completed, the project might offer Russia a poor deal. China will retain other sources of gas, starting with Central Asia. Gazprom, on the other hand, will be dependent on one buyer. Sergey Vakulenko, a former oil executive at the firm, says China could simply wait until 2025-26, when vast new LNG supply from America and Qatar will enter the market, before imposing terrible terms. Russia’s economy ministry already predicts that the price of its gas exports to China will average $257 per cubic metre in 2027, compared with $320 for flows to its remaining European clients.

The project would also entail other risks. To recoup its investment, Gazprom would have to run the pipe at full tilt for at least 20 years. In principle, that is achievable. As it decarbonises, China has room to cut consumption of coal, the cheapest and dirtiest fuel, while still using gas. But an economic rebound could prompt it to ramp up its renewables capacity further still, in which case it may wean itself off gas sooner. Or its economy could do worse than expected, prompting it to switch back to coal.

Supersizing LNG production—Russia’s second option—looks a somewhat safer bet. Once on a ship, fuel can be sent anywhere. And Russia’s LNG may outcompete that from elsewhere. The gas Russia feeds its main liquefaction terminals is cheaper than any exporter bar Qatar, and liquefaction works well in the cold. Russia aims to boost its LNG exports to 100m tonnes by 2030, equivalent to 138bcm of gas, and up from 31m last year. It projects its market share will reach 20% by 2030, up from 8% now.

Yet that may be ambitious. New LNG plants and transport facilities require Western goods that sanctions have made elusive. Japanese investors in Arctic LNG 2, Russia’s flagship LNG project, have withdrawn; Chinese ones have asked America for sanction waivers that are unlikely to be granted. To plug the gap, Russia is lavishing Novatek, its biggest LNG firm, with hand-outs and developing homegrown tech.

An autarkic gas industry will take time to emerge. Arctic LNG 2, originally slated to start deliveries by the first quarter of 2024, suspended production last month. Rystad Energy, a consultancy, expects Russia’s LNG production to reach only 40m tonnes by 2035—some 100m short of the Kremlin’s ambitions. Finding buyers will be tough. Anne-Sophie Corbeau of Columbia University thinks Russia will have to sell to poorer countries, offering generous contracts.

This litany of difficulties means Russia will not be able to claw back much of the revenue it once earned from Europe. As the green transition rolls on, forecasters reckon the golden age of gas will last for a couple of decades at best. Western sanctions and Russian blunders are not preventing war in Ukraine. But they are dealing a blow to Russia’s future as a leading energy supplier.

https://www.economist.com/finance-and-economics/2024/05/02/russias-gas-business-will-never-recover-from-the-war-in-ukraine?utm_medium=social-media.content.np&utm_source=twitter&utm_campaign=editorial-social&utm_content=discovery.content

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639152)

So now Russia is going to have to sell their oil to China at a huge discount all so they can knock a point or two off of Germany's growth rate.

Russia is an economic pariah among the nations which collectively make up a large majority of the world's GDP. Oh, but at least some dictator in Niger likes them.

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639811)

u realize germany has deindustrialized their furking economy? they are FURKED< they are paying X more for energy now cause they import it from KIKE USA etc instead of just getting cheap ruskie gas

and stupid bitch merkel shut their nuke plants and they are FURKED

germany is FURKED

oh it grew by .2%!!! LOL that is what birdshits are happy with now

SICK SHIT lol

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639832)

No, I admit I missed that detail in my nightly watching of German news programs.

https://www.yahoo.com/news/rheinmetall-ups-profit-ramps-production-174420960.html

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639841)

putin's invasion of ukraine resulted in the pro-russian parts of the country being displaced and all their shit bombed out, he basically forged a Ukrainian national identity that didn't exist before, while showing everyone WHY they should be closer to the EU instead of Russia

furthermore, NOW germany etc. who were cool with russian oil before now are, for generations, going to want a strong buffer between the EU and Russia, which is a FRIENDLY UKRAINE

it was an irreversible geopolitical blunder on Putin's part

people still talking about Russia's future 180ness are unhinged from reality

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639852)

have fun, russiacucks

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639947)

By getting a reduced price on Russian oil, China and India are SANCTIONING Russia for all intents and purposes.

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639986)

can’t imagine why

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47639992)

Power of Siberia (Sila Sibiri, formerly named the Yakutia–Khabarovsk–Vladivostok pipeline, also known as China–Russia East-Route Natural Gas pipeline; Russian: Сила Сибири, Chinese: 中俄东线天然气管道; pinyin: zhōng é dōng xiàn tiānránqì guǎndào) is a Gazprom-operated pipeline in Eastern Siberia that transports natural gas from Yakutia to Primorsky Krai and China. It is a part of the eastern gas route from Siberia to China.

The pipeline was filled with gas in October 2019.[1][14] Deliveries to China started on 2 December 2019.[15][16] In 2020, China has imported 4.1 billion cubic meters of natural gas from Russia through the pipeline. It is expected that amount will increase to 38 billion cubic meters by 2023.[17]

https://en.wikipedia.org/wiki/Power_of_Siberia

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47640055)

In 2022, China significantly increased its natural gas imports from Russia, with a 54% rise to 16 billion cubic meters, largely through the Power of Siberia pipeline. This pipeline is projected to reach a capacity of 38 bcm by 2025. This increase is part of China's strategy to diversify its energy sources and enhance energy security.[3]

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47640075)

China wants CHEAP gas. so after russia finances and builds the whole thing with a minimum 20 year break even period China comes back and says “we want cheaper cheaper cheaper” and russia will start selling at a loss

this war has bent russia over the proverbial Chinese barrel

(http://www.autoadmit.com/thread.php?thread_id=5525632&forum_id=2#47641644)