Report: China-Russia gas deal delayed

The gas deal, which has been going on for more than a decade, is facing setbacks, according to report.

13:31 21 May 2014

Russian President Vladimir Putin’s gas deal with China, which has been going on for more than a decade, remains unsigned. The deal is seen as Putin’s bid to take his business east amid amounting sanctions from the west. 

 

Mao Zefeng, the spokesman for China National Petroleum Corporation, told the Financial Times: "We won't be signing. At the moment the import price and the domestic price are inverted. We are already losing money on imported gas, and we can't lose more."

 

The deal involves Russia exporting up to 38 billion cubic meters of gas per year starting in 2018. 

 

Commenting on the deal, Sergei Utkin, political expert at the Russian Academy of Sciences, said: "It's a demonstration of the fact that Russia always has and always will have other options to develop relations elsewhere. The threat of isolation coming from the West will not be complete,"

 

However, Russia is more optimistic. Putin’s spokesperson Dmitry Peskov was quoted saying: “Negotiations are ongoing; the deal could be signed at any moment.”

 

Jonathan Stern, chairman of the Natural Gas Research Program at the Oxford Institute for Energy Studies, responded by saying: "My understanding is that the deal has not been signed today by the Russian and Chinese presidents, which is disappointing. The suggestion that it will be signed any minute as soon as they work out pricing is what the Russian side has been saying for three years."