Russia could offer China better gas pricing

Russia is well positioned to supply more pipeline gas to China as a weaker currency makes pricing more competitive

The ruble-dollar exchange rate has depreciated significantly over the past 12-18 months. “We don’t think it will recover to previous rates, so what that does is push down the cost of Russian supply. Around 80% of Russian gas costs are ruble-denominated, so the ability of Russia to offer competitive supply into China is not something that has been lost in Beijing,” Gavin Thompson, an Asian gas specialist at energy research firm Wood Mackenzie, told delegates at the GasTech conference. “We think Chinese buyers continue to push hard for attractive pricing. But in a weaker ruble environment Russia will potentially be able to offer more attractive pricing into China”, he added. The ruble-dollar e