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Putin claims China will benefit from market-based price of gas via new pipeline

The Russian President Vladimir Putin stated on Wednesday that China would benefit from the new Power of Siberia 2 pipeline because it would provide gas at a competitive price, based on market formula.

Gazprom announced on Tuesday that Russia and China had signed a binding agreement on the pipeline but they have not yet agreed on its price. This shows President Xi Jinping’s disdain for Western pressure to back away from a deeper partnership with Moscow.

Putin said that the gas agreements would guarantee Russia's supply of more than 100 billion cubic meters (bcms) of gas to China each year when the new pipeline is built.

He stated that the price of gas to be supplied to China will be determined by a "market-based formulation", but did not provide any further details.

Putin stated that energy demand was increasing globally, including in China. He said that agreements with Russia, as the world's largest producer of natural resources would ensure reliable and stable supplies. Reporting by Guy Faulconbridge; Editing by Mark Trevelyan and Guy Faulconbridge

(source: Reuters)