Let’s start with the fact that the prime cost of gas production in Russia
is one of the lowest in the world, its price is about $ 35 per 1 thousand m3 . For instance, in the USA it is from 180 to 250 dollars, depending on the deposit. At the same time, the price of gas in the countries of the European Union for 6-10-2022 is 1815 dollars.
According to the customs of China, for 8 months of this year, China purchased natural gas from Russia through the Power of Siberia gas pipeline by 60.8% more compared to the same period last year. The price for this gas is $ 350 per 1 thousand m3.
Taking into account the current economic situation in China, namely, with the Communist Party’s policy of “zero incidence of COVID-19”, as a result of which enterprises and entire cities are still being closed on lockdowns, gas consumption in the domestic market of the PRC has fallen by 17%. According to the research company Kpler, gas imports from China to the EU increased by 60% in the first 6 months of this year and amounted to about 53 million tons.
We would also like to note that before the outbreak of the war unleashed by Russia against Ukraine, the European Union purchased Russian gas at a price of about $ 350 per 1 thousand m3.
Based on the above, it follows that Russia has redirected the flows of gas it produces from the EU to China at the same price, and the PRC, in turn, resells it with an extra charge in the EU.