CNPC chairman meets Chinese vice premiers as Beijing weighs Power of Siberia 2 pricing
Chinese leadership engagement with CNPC signals policy focus on gas supply security while Moscow presses its fifth pipeline attempt.
Xu Qin and Liang Huiling, both vice premiers of China's State Council, met with Dai Houliang, chairman of China National Petroleum Corporation, on Thursday (2026-08-13), according to a Sohu report. The meeting places the state oil and gas giant's leadership directly before Beijing's top energy policymakers amid ongoing negotiations with Russia over the Power of Siberia 2 pipeline.7
The timing is significant. Russian President Vladimir Putin made his fifth attempt to secure Chinese support for the pipeline during his visit to Beijing on Tuesday (2026-05-19), with Bloomberg reporting that Moscow sees the West Asia conflict as reinforcing Russia's role as a key raw material supplier to China. The CNPC meeting suggests Beijing is now engaging at the highest administrative level on how to integrate additional Russian gas into its supply mix.4,2
Power of Siberia 2, which would run from Siberia to China via Mongolia, remains the centerpiece of Moscow's efforts to diversify its gas export routes away from Europe. A source close to Gazprom said the Russian state energy giant has made a "very attractive" pricing offer for supplies through the pipeline. Chinese officials have shown greater interest in expanding overland transit routes and the Northern Sea Route in the Arctic, according to people familiar with the talks.1
But attractive pricing from Gazprom does not automatically translate into a deal. China has held out through four previous attempts by Putin to advance the project, and the commercial terms have been the sticking point. Beijing's leverage has grown as its domestic gas production expands and as alternative supply options mature.1,3
China's gas output is no longer a marginal factor in these negotiations. Deep coalbed gas production rose to 2.5 billion cubic meters within just three years, a key highlight in the country's expanding natural gas output, according to the National Energy Administration's list of Top 10 Landmark Achievements in National Oil and Gas Exploration and Development for 2024. Every bcm of domestic supply reduces China's urgency to sign Russian contracts on Moscow's terms.3
The corporate reporting season underscores the financial health of China's upstream majors. CNOOC's quarterly report showed oil and gas sales revenue of 97,000 million yuan, up 9.9% from 88,268 million a year earlier, with crude and liquids sales rising 11.3%. Capital expenditures on development jumped 24.0% to 21,807 million yuan, indicating active investment in domestic and overseas production capacity.5
PetroChina and Sinopec both filed quarterly reports with the Hong Kong stock exchange on Wednesday (2026-07-01), the standard disclosure date for the sector's interim results. The filings confirm that China's national oil companies are generating sufficient cash flow to fund their own expansion without needing to extract maximum volume from any single new pipeline project.6,7
Market pricing suggests traders are not banking on a quick Power of Siberia 2 breakthrough. Front-month JKM Asian LNG stood at $21.19/MMBtu at 18:02 UTC on Thursday (2026-08-13), while ICE Brent Crude front-month was $87.78/bbl and TTF Gas was €61.03/MWh at 08:15 UTC. A Chinese commitment to Russian pipeline gas would pressure JKM over the medium term, but the lack of major price moves on the news indicates limited immediate expectations.1
The bearish consensus across the signal set, with 100% directional strength and six signals, aligns with the view that Chinese demand growth will be met through multiple channels, not a single Russian pipeline. That includes domestic coalbed gas, LNG imports, and overland routes that do not require the same scale of fixed infrastructure commitment as Power of Siberia 2.3
What matters for the market is the pricing detail that has not been publicly disclosed. Gazprom's "very attractive" offer is a negotiating position, not a contract. Chinese negotiators have consistently sought pricing formulas linked to domestic hub prices in China rather than to oil-indexed benchmarks, and Moscow has resisted that structure.1
The meeting between the vice premiers and CNPC's chairman does not itself announce a decision. But it places the company at the center of a policy review that now involves China's top economic officials. Whether Dai Houliang emerges with a mandate to sign, or with instructions to hold, will shape both the pace of Russian gas flows into China and the trajectory of JKM pricing through 2027.7,1
Traders should watch for any statement from CNPC or the National Energy Administration in the coming weeks that references Mongolia transit agreements or pipeline construction timelines. The absence of such statements after a vice-premier level meeting would itself be a signal that pricing stands between Moscow and Beijing.4