Cheap gas despite sanctions risks: Russia has sharply increased LNG exports to China
22 December 20:34
In November, Russia’s exports of liquefied natural gas (LNG) to China reached a record high of 1.6 million tons. Deliveries more than doubled year-on-year, making Russia the second largest supplier of LNG to China after Qatar. Bloomberg writes about this, "Komersant Ukrainian" reports.
The growth occurred against the backdrop of significant discounts and Moscow’s reorientation from the European to the Asian market.
What happened
According to customs statistics cited by Bloomberg, Russia sharply increased LNG supplies to China in November. This jump was made possible by aggressive pricing and demand from Chinese buyers willing to take risks associated with Western sanctions.
Figures and the market
In November, the volume of Russian liquefied natural gas supplies amounted to 1.6 million tons, which is more than double the figure for the previous year. Russia has overtaken Australia to become the second largest supplier of LNG to China after Qatar.
In terms of price, Russian gas was the cheapest among the 12 major suppliers, about 10% lower than the average import price in November, which was $9.85 per million BTU. According to Reuters, some gas was sold at a discount of 30 to 40%.
Why is this happening?
After a sharp decline in exports to Europe as a result of the full-scale invasion of Ukraine, Russia is reorienting gas flows to Asia, primarily to the largest regional market, China. Price cuts have become a key tool for maintaining market share and compensating for losses in the EU.
Sanctions and logistics
In August, China began accepting shipments from the sanctioned Arctic LNG 2 project through a remote terminal in Beihai. At the same time, the plant is facing restrictions: winter ice makes it difficult to ship, which has led to a reduction in production. This creates risks to the stability of supply in the winter months.
China’s alternatives
China has not imported US LNG since February amid trade frictions and weaker domestic demand. At the same time, large Chinese companies are more actively diversifying their portfolios by reselling contracted volumes on global markets. This is easier to do with US LNG, as such contracts usually do not contain strict destination conditions.
Moscow and Beijing’s energy rapprochement goes beyond gas
In November 2025, China purchased a record $961 million worth of gold from Russia, the largest deal in the history of bilateral precious metals trade. This emphasizes the parties’ desire to expand economic cooperation despite the sanctions pressure.
Further dynamics will depend on the winter and logistics of Arctic LNG 2, price competition with Qatar and Australia, and geopolitical risks. For China, cheap Russian LNG remains attractive, but its reliance on it is subject to sanctions and operational risks.
