Moscow is turning a global energy crisis into an opportunity, offering shipments of liquefied natural gas (LNG) from its U.S.-sanctioned facilities to energy-hungry buyers in South Asia at a steep 40% discount to prevailing spot prices. The cargoes were being marketed last week through little-known intermediary companies based in China and Russia, according to people familiar with the matter cited by Bloomberg News.
As per the report, the intermediaries are saying that they can provide paperwork to show that the shipments are from non-Russian sources, like Oman or Nigeria, and remove any traces of true origin.
The move comes as disruptions in the Middle East have throttled roughly one-fifth of global LNG supply. The effective closure of the Strait of Hormuz, combined with attacks on Qatar’s massive export facilities, has sent Asian spot LNG prices soaring, creating acute pressure on import-dependent economies across South Asia. While the ceasefire announced yesterday had promises to open the strait, it didn’t happen as US refused to accept some demands by Iran.
The report stated that Russia is explicitly seeking to lure South Asian nations into purchasing the discounted gas as it looks to offset the impact of Western sanctions that have restricted access to traditional markets.
South Asia’s largest and fastest-growing energy consumer, India, stands out as a particularly attractive potential buyer. The country has aggressively diversified its energy imports since 2022, becoming one of the world’s top purchasers of discounted Russian crude oil. New Delhi has also held previous discussions with Russian officials about cargoes from sanctioned projects such as Arctic LNG 2.
With domestic gas demand rising rapidly to fuel power generation and industry, Indian buyers could view the current 40% discount as a timely hedge against elevated global prices and supply volatility.
The use of opaque intermediaries in China and Russia is a common tactic Moscow has employed to keep sanctioned energy flowing despite U.S. and European restrictions. While the exact project or volume of the latest offers was not disclosed, Russia’s broader strategy has centred on redirecting LNG from facilities like Novatek’s Arctic LNG 2, which have faced buyer hesitation due to secondary-sanctions risks.
