Russia-China Gas Groundhog Day. Again.
News flash (irony intended): the news media are idiots with the memory of a mayfly.
The most recent example, the breathless coverage of the supposed gas deal between Russian and China announced with great fanfare during Putin’s visit to Xi.
“Apparent breakthrough.” “Could reshape.”
Uhm, if you have paid attention, or if you do some actual research, you will know that there have been multiple announcements of the same effing thing over the last 20 effing years. I wrote about these contemporaneously, and always in a tone of hilarity. As I will do today.
Why hilarity, you ask? Because they would make these announcements, and then say: “we’ve agreed to everything but price.” Minor detail!
And of course, the price was never right for both, so the deals always faded away, only to be resurrected to serve some political purpose, like proclaiming Russia’s status as an energy powerhouse, its ability to spurn Europe if the Euros failed to meet Russia’s price terms, or to testify to the deepening relations between China and Russia.
And so here we are. Again. Like Groundhog day.
And like in Groundhog Day, the same thing is happening. It’s a “binding deal,” but
Depending on the details, most of them yet to be hammered out, today’s announcement could connect Russia and China for decades to come. It also sends a message to Washington about a counterweight to US political power — and to American gas. [Emphasis added].
So I guess “most” of the terms aren’t binding, because they haven’t even been negotiated.
Even better:
The Russian-Chinese memorandum formalises intent but defers substance. The real negotiation over the gas supply agreement will rest on four key parameters: price, take-or-pay obligations, financing and timing. [Emphasis added].
Yeah. Everything is set in stone. Except price, quantity, financing, and timing. Other than those trivialities, take it to the bank!
The only reason why this deal might–eventually–happen is that now Putin has no options. Once upon a time, his contract kabuki with the Chinese mainly served to generate negotiating leverage for Putin with the Europeans. Now Europe is dead to him. Gas export revenues are minimal. Russia’s financial situation is dire, so he has more motivation to make a deal.
But of course Xi knows that too, and therefore knows that he can demand an extremely low price, one that barely covers Russia’s costs.
In other words, due to his strategic genius, in this instance launching a war that resulted in the loss of his biggest gas export market, Putin put his balls in Xi’s hands. And Xi is holding a pair of pliers, a la the 1:11 minute mark of this:
(The media is doing a good Gene Wilder impression BTW).
Well, maybe Putin will be able to bioengineer some new goolies.
But back to the media. It’s not as any of this should be news. You have to know this history to be qualified to write about Russia, and Russian gas in particular. But obviously the MSM is not qualified. Note even remotely. Instead, they are Charlie Browns, who never learn and always end up making fools of themselves.
What I find interesting is the Western Trump Deranged Press siding with China, Russia, and India in trying to defy Trump, especially the leverage that Trump placed on India because of Russian trade.
Comment by MARK — September 4, 2025 @ 3:32 pm
Ahh yes, reminded me of the “Deal of the Century” announced a couple of years back, and massively lauded by the Russian media and online fanboys. As you point out, China has the whip hand in this relationship, it being the senior partner. Putin knows that, despite all his fawning and gurning, he may quickly be forced to accept their bargain-basement terms.
On an unrelated note, I wonder if the reported “accidental” hot mic incident was engineered to wind the big orange fella up, given his ongoing health issues?
Comment by David Mercer — September 5, 2025 @ 1:01 am
Spider veins. You’re warming yourself at a small fire, David.
Trump can forestall that with some Rutin supplementation.
Meanwhile, Russia has discovered a gigantic oil field under the Weddell Sea, in Antarctica.
https://www.energy-reporters.com/news/its-more-than-all-the-oil-ever-extracted-from-earth-russian-discovery-sparks-global-uproar-as-energy-powers-clash-over-control/
That’ll throw a spanner into the geopolitical works, won’t it. Time to recalibrate, David.
Comment by Pat Frank — September 6, 2025 @ 3:21 pm
Pat, this is impressive even for you. You’ve managed to present as breaking news in late 2025 a UK media story from may 2024, which itself was recycling a Russian seismic survey press release from 2020. That’s not geopolitics, that’s geological time. At this pace, next year you’ll be shocking us all with the revelation that OPEC just formed. And of course, we now wait with bated breath for your long-overdue analysis of how this five-year-old press release will reshape global energy geopolitics.
https://www.spglobal.com/commodity-insights/en/news-research/latest-news/crude-oil/052924-russia-uk-play-down-fears-over-russian-antarctic-oil-and-gas-research
Comment by [email protected] — September 7, 2025 @ 8:45 pm
A horse you can sell over and over again is a good horse LOL.
Comment by Ex-Global Super-Regulator on Lunch Break — September 8, 2025 @ 7:46 am
Yes, and a dead horse is still dead, no matter how hard – or long – you flog it.
I’m surprised Pat referenced this given it boldly states climate change [gasp!] as one of the reasons this oil *may* become exploitable in the dim and distant future. I’d have thought that would have brought him out in hives. Also, a minor technicality, but surely it would be our oil given it’s under our bit of Antarctica? No doubt we too could reach a mutually beneficial deal at a competitive price, terms etc etc with the Russians (as in ‘It’s our oil, you can f*ck right off’)
Comment by David Mercer — September 9, 2025 @ 12:20 pm
Re the hot mic incident, the terrible trio were transparently baiting Trump. Mind you, with medical advisors like RFK Jr and Pat Frank around, who knows, maybe Trump will live forever – a rufin supplement with a bleach chaser could be the elixir of life? At the very least, it’ll help the embalmer with their job.
Comment by David Mercer — September 9, 2025 @ 12:34 pm