With the onset of Russia Russia-Ukraine conflict in 2022, the West reacted by enacting massive sanctions to cripple the Russian economy and alienate it internationally. However, the result was surprising; it sped up one of the most consequential energy partnerships of the 21st century between Russia and China. The bilateral trade surged significantly from $146.88 billion in 2021 to $244.8 billion in 2024 (see Figure 1).

China is currently Russia’s top trade partner, while Russia is China’s sixth-largest. In addition to military and economic relations within their proclaimed partnership of no limits, both sides broadened collaboration in the energy sector, especially pipeline gas and oil.

Since the establishment of diplomatic relations, China and Russia have worked on numerous energy projects. Such collaboration in nuclear energy goes as far back as the Cold War era, when Joseph Stalin supplied China with the first nuclear reactor in the 1950s. In the post-Cold War era, various oil and gas exploration projects were signed between the two neighboring countries.

The Sakhalin-3 Veninsky oil exploration project was signed in March 2007 by Russian oil giant Rosneft and China’s Sinopec. The Yamal LNG project, launched in 2014, gave China access to a staggering 1.3 trillion cubic meters of Russian gas — enough to power it for decades. Both these projects are related to joint exploration. Furthermore, nuclear energy deals were also signed between the two countries. In June 2018, Russia and China inked a deal to jointly build four nuclear power plants, totalling more than $3 billion.

China, with the world’s second-largest population of 1.42 billion, requires more energy resources to fulfill its growing demand. Russia, with its vast energy resources, is a reasonable option to fulfil these needs. For the secure and stable import of Russian oil and gas reserves, various agreements were signed between the two countries.

Following Russia’s annexation of Crimea in February 2014, the relations between Russia and the West began to deteriorate. The Russians saw their vast energy export to the West in danger, and began to search for new markets. Two months later, in May 2014, several bilateral energy cooperation agreements were inked in the presence of President Putin and President Xi Jinping.

The Power of Siberia (PS-1) was the major deal signed on that day. China National Petroleum Corp. (CNPC) and Gazprom, Russia’s national gas company, signed a $400 billion deal for the supply of 38 billion cubic meters (bcm) of natural gas per year for 30 years. The pipeline includes two sections: the Russian and Chinese sections. The Russian segment supplies gas from eastern Russia (Siberia) to the northeastern region of Blagoveshchensk near the Chinese border. This 3,000-kilometre section of the pipeline became fully operational in 2019.

The Chinese section of the pipeline stretches from Heihe to Shanghai, with a total length of over 5000 km, and was completed in December 2024. Russia has shipped 22.7 billion cubic meters of natural gas to China via the PS-1 as of 2023. The PS-1 kept increasing its output until it reached maximum capacity, with an export flow target of 3.7 Bcf/d (0.105 bcm/d) by 2025.

The Russo-Ukrainian conflict resulted in the disruption of energy exports to the West. Moreover, the explosion in the Nord Stream gas pipeline (NS-1) also disrupted the minimum flow of gas to Europe. The proposed PS-2 pipeline would replace the lost export capacity from Nord Stream 1, as PS-2 is projected to have a 50 bcm/y design capacity (see Figure 1). The deal remains unsigned, with negotiations still underway. During the December 2024 visit, Russia’s Deputy Prime Minister said that the feasibility study and the front-end engineering design work have been done.

According to some commentators, Beijing has so far taken a wait-and-see stance in an attempt to strengthen its negotiating position for better prices. While some argue that China is cautious about its over-dependence on Russian energy.

In the wake of increasing pressure from the West, Russia has increased its cooperation with new partners in Asia. China produces 58% of its natural gas domestically, and to fulfil its growing energy demand, it relies on imports. Currently, Russia is China’s biggest supplier of natural gas, replacing Turkmenistan. Moreover, for China, it means less reliance on Middle Eastern and Australian LNG, which are too expensive.

These pipelines will provide the stable and secure energy supply needed for China’s rapidly growing economy and massive population. Two factors make Russia a good partner of China. First, the cheap energy prices, and second, to carry out transactions in yuan. Russia also provides a structured alternative to seaborne imports, which are vulnerable to geopolitical risk.

The Northern Sea Route (NSR) has seen a significant surge in maritime shipments, particularly between China and Russia. Since 2022, Russia has been exporting its oil shipments to China through this route. As of 2023, approximately 10.7 million barrels of oil have been shipped to China via this route, surpassing last season’s total of 10.5 million barrels. Both countries had spent heavily to increase trade on the NSR, building ships with tougher hulls capable of sailing through ice or by having nuclear-powered icebreakers.

Furthermore, the ESPO (Eastern Siberia–Pacific Ocean) oil pipeline is also a key means of Russian oil export to China. Due to ESPO’s import of crude oil, Russia has surpassed Saudi Arabia as the biggest oil exporter to mainland China.  Through the ESPO oil pipeline, Asian refineries imported 120 MMt/y(879.6 MBbl/y) of Russian oil in 2021, with more than 80% of the oil going to mainland China. As of 2024, China has imported 791.64 million barrels of oil from Russia.

The oil imports from Russia reduce China’s reliance on the Middle East, a long route vulnerable to geopolitical tensions. The Northern Sea Route has rerouted China’s oil export from the Red Sea, where the Houthis’ blockade is affecting global trade. Moreover, this path is an alternative to China, avoiding maritime chokepoints like the Strait of Malacca and the Suez Canal. The Indo-Pacific strategy of the US is to counter Chinese influence and halt its trade; NSR would be the most optimal alternative to China.

China and Russia, the strongest pillars of a multipolar world, have increased cooperation since the Russia-Ukrainian conflict. Impacted by sanctions, Russia needs an alternative market for its energy export, while China needs cheap energy to fulfill its growing demand. With this cooperation, Beijing is getting stable and cheap energy, while Russia has a stable market for its energy export to sustain the economy, bypass sanctions, and continue its military campaign in Ukraine. Whether it’s the vast pipelines spanning from Siberia to Shanghai or the Arctic shipping route bypassing key chokepoints, China-Russia energy cooperation is no longer transactional; it’s transformational.

Disclaimer: The opinions expressed in this article are solely those of the author. They do not represent the views, beliefs, or policies of the Stratheia.