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Reilly, T., Yenikeyeff S., Paik K.-W., The Next Energy Battle: How Russia and China Could Shape the Northeast Asian Gas Market
Since the end of the global COVID-19 pandemic, economic activity in China has speeded up, as did the competition
between Europe and Asia for securing LNG supplies. However, a more intense energy battle is taking place in Northeast
Asia where Russia, the United States, Australia, and Qatar wrestle to capture this fledgling LNG and gas market, dominated by the world’s biggest LNG consumers, AQ1 Japan, China, and South Korea. This market is of such a large
scale that it is poised to become a critical regional, gas-trading hub in Asia, where LNG pricing may be in time de-linked
from oil and payments may not necessarily be in the U.S dollar. Which supplier wins over the LNG and gas market in
Northeast Asia is now a key question as the winner will exploit energy’s regional economic leverage, and thus gain
geopolitical influence as a consequence. With the looming prospects of losing the entire European gas market, Russia is
actively seeking to divert its gas supplies to Asia. China’s position is crucial, and it is not only about the security of energy supplies. The energy supply options of Japan and South Korea make up another important strategic factor for
Washington as the U.S. tries to contain China and neighboring Russian territories in the Far East. This makes the
emerging energy battle for Northeast Asia of increasing concern to Washington. The emerging fragmentation of the
global economic universe into competing blocs could also have a major impact on the energy order in Northeast Asia.
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