Russia cuts forecast for gas exports to key markets, gas price for China - document

• Russian pipeline gas exports to non-ex-Soviet countries are forecast to reach only 84.5 bcm by 2029, down from previous estimates of 87 bcm, as the EU phases out imports by November 2027
• China-bound gas exports may increase 47% to 56 bcm annually after 2027 with new pipeline capacity, but at significantly lower prices than Europe due to oil-linked rather than spot-based pricing
• Budget revenues from gas sales are expected to remain near 2025 levels through 2030 despite volume shifts, putting additional pressure on Russia's budget already strained by military spending

Russia Cuts Gas Export and Price Forecasts as China Becomes Top Market

Russian authorities have downgraded gas export forecasts and price estimates for China, adding pressure to a budget already strained by military spending, according to a government document obtained by Reuters.

Key Figures and Forecasts:

• Pipeline gas exports to non-ex-Soviet countries projected at 75 bcm in 2025 (down from 78.2 bcm in 2024)
• 2028-2029 estimates reduced to 82-84.5 bcm, down from previous 87 bcm forecasts
• China gas price forecast cut over 7% to $224-236 per 1,000 cubic meters for 2027-2029
• China-bound exports may increase 47% to 56 bcm annually after 2027 with new infrastructure

Market Dynamics:

China has become Russia's largest gas export market following the loss of European customers. However, China pays approximately 30% less than Europe due to oil-linked pricing versus European spot hub pricing. The EU plans to completely phase out Russian gas imports by November 2027, while Turkey has extended contracts covering 22 bcm for only one year.

Strategic Context:

President Putin's visit to China this week is expected to focus on expanding oil and gas supply arrangements. New infrastructure includes a Far Eastern route (12 bcm capacity) and expanded Power of Siberia pipeline deliveries (6 bcm increase).

Financial Implications:

Reuters calculations suggest Russia's budget revenues from gas sales may remain near 2025 levels through 2030, depending on transportation costs, rouble exchange rates, and taxes. The downward revisions reflect broader economic pressures on Russia's socio-economic development outlook through 2029.