Bloomberg: China's Gas-Demand Growth Rate Below GDP Hinders Russian Deals

China’s demand for natural gas is on pace to grow at a slower rate than the economy for a second straight year, a fact that bodes poorly for any energy agreements that President Xi Jinping and Russian counterpart Vladimir Putin may sign during a meeting in Beijing today.

China’s natural-gas consumption through July rose just 2.3 percent from the same period in 2014, according to data released by the National Development and Reform Commission. Apparent demand actually fell by more than 5 percent in April and May, the first year-on-year declines since at least 2011.

That data reflects the shifting nature of China’s economy and the forces underpinning the two countries’ relationship. An economic slowdown and lagging industrial production has affected China’s appetite for everything from iron ore to fossil fuels, while Russia’s recession amid a plunge in oil prices and western sanctions only increases the urgency for it to sign new deals. MORE