China has shown its power by organizing a colossal military parade that celebrates the 80th anniversary of the end of World War II, this Wednesday, September 3 in Beijing. Accompanied by about twenty foreign leaders, including Vladimir Putin, Xi Jinping, tried to adjust the balance of power with “West” and the United States of Donald Trump.
And behind the scene, Moscow and Beijing agreed to build a new gigantic gas pipeline. Far from being a detail, this project “is a geopolitical inflection point with global repercussions,” he estimates that Tatiana Mitrova, specialist in Finy researchers, in the Financial Times.
In fact, Gazprom, the Russian energy giant, announced on September 2 that it had been found that a “binding agreement” materialized the “Power of Siberia 2” project, which should allow to send 50 billion cubic meters per year to China, from the Siberian deposits that previously promoted Europe.
This pipe would have the same capacity significantly as “Nord Stream 1”, built between Russia and Germany, in the end since 2022 and the invasion of Ukraine by Moscow.
At first glance, this new gas pipeline does Vladimir Putin’s business, while his country’s economy is currently in great suffering. This new gas pipe could partially compensate for the deficit born to European sanctions and restore some air to Russia.
Great winner
But to look at it, it is a “Pyrrhus victory for Russia,” says Joseph Dellatte and Rosalie Klein, in a note published by the Montaigne Institute. According to these researchers, China, the world’s first world importer, is the great winner of the operation.
First, because Moscow should sell its gas at broken prices. The Chief of Gazprom, Alexei Miller, announced to the Russian press a price below that he practiced with European countries.
Above all, this pipe should strengthen Russia’s dependence in China, “barely disguised under the rhetoric of the ‘Sino-Rusa friendship” in the words of the researchers of the Montaigne Institute. “Once the power of Siberia 2 operational, China would absorb two thirds of the current gas exports of Russia,” Joseph Dellatte and Rosalie Klein note.
The terms of the agreement also give “China the law, but not the obligation, to obtain Russian gas at a reduced price in the future,” observes Tatiana Mitrova, specialist in Energy Affairs, in financial times.
China also responds to the United States of Donald Trump, the main world producer of oil and natural gas. Donald Trump has particularly in its exports of liquefied natural gas (LNG) to boost its economy.
Therefore, LNG prices could reduce and alter certain US investment projects.
Great lost Europe
In the end, this is likely to strengthen the difficulties of the European Union, described as “great loser in this New World Energy Order” in the Montaigne Institute note.
On the one hand, Donald Trump can increase its pressures to support US hydrocarbon exporters. On the other hand, European companies will suffer the competition of a Chinese dapada industry with Russian gas.
In exchange for customs tasks of “only” 15%, Donald Trump has already demanded that the EU increase its energy purchases, especially gas, up to 700 billion euros. A condition that the Commission has agreed, without having the power to buy gas instead of European companies.
In addition to the climatic consequences, this dynamic runs the risk of perpetuating the European dependence on fossil fuels, while Europe almost does not extract it, which exposes it in a strategic and economic plan, as evidenced by the invasion of Ukraine by Russia.
Energy prices have jumped since 2022. This permanently weighs on the competitiveness of the continental industry. Gas prices are three or five times higher than in the United States, against only two or three before the war in Ukraine according to Mario Draghi’s report in 2024.
At the same time, electricity is also three more expensive than in China, while prices were historically at the same level, according to the report presented by the former president of the European Central Bank.
Consequently, the industrial production of the euro zone fell since the summer of 2023. It only found its level of 2021 in early 2025, according to Eurostat. Meanwhile, hundreds of thousands of jobs have already been destroyed, 250,000 alone in Germany.
It is likely that industrial sectors disappear, helping to stop growth and increased wages, while weighing the weight of public debts. A vicious circle is underway.
Source: BFM TV
