Russia Budget Forecast Puts China Gas Price 56% Below Far-Abroad Markets Excluding China

Russia’s draft federal budget projects that the 2026 average price of pipeline gas sold to China will be 55.9% below its forecast for far-abroad markets excluding China, highlighting different price assumptions across its export markets.

The State Duma approved the 2027–2029 budget draft in a first reading on Oct. 29. Its projections put the 2026 average at $247.90 per 1,000 cubic meters for China and $562 for far-abroad markets excluding China.

The difference is $314.10 per 1,000 cubic meters. The comparison is between two budget forecasts; it is not a newly negotiated price or a final average for 2026.

The draft projects China’s average at $251.30 per 1,000 cubic meters in 2027, $247.80 in 2028 and $246.40 in 2029. For far-abroad markets excluding China, it forecasts $450 in 2027, $361.90 in 2028 and $323.20 in 2029.

Gazprom supplied 38.8 billion cubic meters of gas to China through the Power of Siberia pipeline in 2025. The pipeline reached its maximum contractual rate, equivalent to 38 billion cubic meters a year, on Dec. 1, 2024.

The proposed Power of Baikal pipeline, formerly called Power of Siberia 2, is the subject of separate commercial negotiations between Russian and Chinese companies. On Oct. 21, Russian Deputy Prime Minister Alexander Novak said he was waiting for the companies to conduct those negotiations and hoped they would reach agreements by year-end.

Novak did not announce a signed deal or a price. The budget’s price projections do not establish the commercial terms for the proposed pipeline.

Sergey Vakulenko, a senior fellow at the Carnegie Russia Eurasia Center, argued that losing Europe as a major buyer strengthened China’s position in negotiations. “It’s much harder for Russian negotiators today,” he wrote. The year-end target Novak described is for companies to reach agreements; no agreed price was announced.