For the last ten years, if I had a kopek for every time I had been told a China-Russia gas deal was imminent only to see it fade, I might be a Russian oligarch at this point.
Now, there is a different type of impetus out there that might see Russia agree to a deal they might not have years ago: Ukraine. On a day when Russia (RSX, quote) slapped Ukraine with an $11.4Bn take or pay bill for gas they can't pay for, there is talk Putin is squaring away his plans for a May 21 visit to China to finally cut a gas deal with China.
Problem remains pricing, and I'm hearing the sides are about $100/mcm apart. This is significant. But as downgrades come and sanctions build, Russia may move quicker than expected. I don't think Russia feels compelled to do a deal with the devil (sorry, China), but I do think they are less firm in their pricing demands than 6 months ago.
Not only are western buyers looking for other options Russia never thought they had, but Russia has to be finally accepting that U.S. and Canada are in a very different place with Shale Gas and LNG than Russia ever could have expected 3 years ago.