Made for each other

Russia and China have major influences on the world's energy markets—one with production and the other with consumption. That makes them natural partners. Geopolitics may stand in the way, but Russian energy exports to Asia look logical and economic, writes Stephen O'Sullivan, United Financial Group

RUSSIA AND China are having a profound effect on the world's oil and gas industry, one on the supply side, the other through demand. Russian oil output has risen by 50% over the past five years, to over 9.2m barrels a day (b/d), placing it a close second to Saudi Arabia in the production stakes. Chinese oil demand has doubled over the past decade, to over 6m b/d. Logic dictates that there ought to be much common ground between these two neighbouring energy giants. It has become impossible to discuss energy exports from Russia without considering the Asian market. Oil exports to the east will go ahead in some form, although Yukos, which put Asian markets on the Russian agenda, will not be dir