China and Russia have struck a major gas deal, which is estimated to be worth $400 billion. Under the 30-year contract starting in 2018 Russia will supply 38 billion cubic meters of natural gas to China every year. But the deal is not only economically important, it also has major geopolitical implications, particularly at a time when Russia is facing sanctions from the EU and the US.

For Russia the deal is a breakthrough in securing a significant share of China’s energy market. And it is equally important for China having secured its energy supplies for the next 20 to 30 years and comes as part of its plans to switch from coal to cleaner fuels and to diversify its energy supply.

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