Russia signs deal to build Power of Siberia 2 gas pipeline to China

In early September 2025, Russia's state-owned gas company Gazprom announced a deal for the construction of the Power of Siberia 2 pipeline, designed to transport natural gas from western Siberia through Mongolia to China. This pipeline is intended to partially compensate for the significant revenue losses Russia experienced due to its reduction in natural gas shipments to Europe following the invasion of Ukraine. The project aims to deliver 50 billion cubic meters of gas annually to China, which in comparison, previously exported up to 180 billion cubic meters to Europe. The announcement came during a meeting between Russian President Vladimir Putin and Chinese President Xi Jinping, emphasizing the strengthening ties between the two nations. However, critical details regarding gas pricing and financing arrangements for the pipeline were notably absent from the discussion, leading analysts to question the legitimacy of the deal. Many speculate that Beijing is not fully committed to the entirety of the project and may demand significantly discounted rates for the gas. This signals China's dominant position in energy negotiations, with experts noting that Russia might still be subsidizing Chinese gas consumption, raising concerns about Russia’s long-term energy strategies. In addition to the energy deal, China continues to expand its influence in Central Asia, marking its presence through substantial agreements with various Central Asian nations, particularly Kazakhstan and Uzbekistan. During the Shanghai Cooperation Organization summit and other high-level meetings, new deals totaling billions of dollars have been signed, encompassing sectors such as infrastructure, nuclear energy, and renewable energy. Significantly, Kazakhstan and Uzbekistan have emerged as crucial players in Central Asia, with investments flowing heavily toward energy projects and technology partnerships. Despite the rising partnership with China, Central Asian countries exercise a cautious approach toward overdependence on Beijing. Their longstanding multivector foreign policies aim to balance relationships with multiple countries, including Western investment interests. As these nations continue to seek investment for development across various sectors, it remains to be seen how China will navigate its significant leverage over energy resources while ensuring stable demand within a rapidly shifting global energy landscape.