And in the process, the beginning of the end for the petrodollar:
We have previously profiled the "holy grail" gas deal between Russia and China on several occasions, and with its announcement scheduled for next week (barring some unmitigated disaster) during Putin's first visit to China since Xi's appointment as president last March, it is time to do a status update on where it stands even if at this point finding the "holy Grail" is merely a formality.
The Hong Kong publication reports that China and Russia hope to sign a massive deal for natural gas supply when their leaders meet in a regional summit in Shanghai next week, a senior diplomat has said. Under the deal, Russia will supply 38 billion cubic metres of natural gas annually to China for 30 years. Deputy Foreign Minister Cheng Guoping told reporters yesterday that President Xi Jinping would discuss the deal and other points of co-operation with his Russian counterpart, Vladimir Putin, who will visit Shanghai on Tuesday.
Russian Deputy Energy Minister Anatoly Yanovsky said on Monday that the deal was "98 per cent ready". Supply would begin no later than the end of 2018.
Indicating just how important China now is to Russia, Bloomberg adds that traveling with Putin will be the who-is-who of Russian politics and business:
- Gazprom CEO Alexey Miller also in delegation as Russian President Vladimir Putin visits China on May 20-21, Yuri Ushakov, Kremlin foreign policy aide, tells reporters in Moscow.
- Ushakov also says that Russia-China trade may reach $100b as early as this year.
- Gazprom working on China gas deal, Rosneft working onSinopec deal, Novatek working on deal
- China-Russia talks demand compromises on both sides
- Worsening relations with U.S. and allies "clearly to some degree influence" China talks
- Billionaire Oleg Deripaska also traveling to China
Russia has been trying to diversify its energy export base beyond the European market, where Gazprom generates about 80 per cent of its revenue.
China relied on imports for nearly a third of its natural gas needs, Xinhua said.
It imported 53 billion cubic metres of natural gas last year, according to the China National Petroleum Corporation.
Putin's visit will be his first to China since Xi was named president in March last year.
Quid pro quo: "Observers expect both leaders to take a united stand on major international issues, and Putin may seek China's support on Russia's dealings with Ukraine."
And also on the dollar as we reported in "Russia Holds "De-Dollarization Meeting": China, Iran Willing To Drop USD From Bilateral Trade." In which case expect random Chinese space rockets to mysteriously explode during take off too.