Shanghai, in accordance with a news report of news.in.grAn agreement sought between China and the Russian Gazprom corporation for natural gas, was signed on Wednesday, May 21, 2014, in Shanghai.Information on the details of the agreement has not yet been released on the value of the deal. Both sides sought an agreement for almost a decade but had been struggling to reach due to the difference in the price expectations of the two sides.The agreement is estimated to set the level at 38 billion cubic meters of natural gas annually through a new pipeline. According with what has been reported so far, the formal agreement between Gazprom and Chinese CNPC is for at least 30 years and the value is reported to be around 400 billion dollars.
The Russian President Vladimir Putin was in Shanghai for a two-day visit, from which many expected the deal to be signed. Thanks to this agreement, the Russian Gazprom can utilize huge gas fields in Eastern Siberia which are far away from the European market.
This agreement could have a significant effect on Russia’s future economic strategic relation with the western economies and the effect of economic sanctions on Russian’s expansion of her sphere of influence. It could also influence the western corporations’ level of business conducted in Russia as her dependence on selling gas to the West, proportionately, decreases.