Has Putin caught a spy ring tied to China?

The Kremlin’s hopes of greater Chinese assistance took several blows this week due to unfavorable economic trends, including another potential large-scale COVID outbreak within mainland China. Chinese authorities reported over 300 confirmed COVID cases across multiple provinces, raising the probability of another round of mass mobility restrictions, which could lower oil prices and reduce Russian energy export earnings.

Moreover, lockdowns and declining Chinese growth prospects will likely limit Beijing’s willingness to undertake foreign policy risks — such as increasing support for Putin — and make Beijing more inclined to negotiate with Washington and Brussels on trade matters. Though there is a reasonable chance that Washington and Beijing will come to an agreement on tariffs, significant hurdles remain.

Oil prices down despite another CPC closure

A Russian court ordered the Caspian Pipeline Consortium (CPC) to suspend operations for 30 days on Tuesday. The CPC system, which sources crude oil from Kazakhstan before delivering it to Western destinations, was at the center of a bilateral spat between China and Russia in March. While most Kazakh crude is exported west, not east, Chinese oil companies are major players in the country, and Beijing is likely unhappy with Moscow’s restrictions.

• Although Kazakhstan says oil volumes along the pipeline remain at normal levels, Kazakh President Kassym-Jomart Tokayev ordered his government to study alternative oil supply routes.
• While Nur-Sultan seems to favor the construction of a pipeline through the Caspian Sea, a Kazakhstan-to-China route remains a possibility, though the geological and geopolitical challenges would likely prove daunting.

China and Kazakhstan also announced that they would build a third railway along the border, which would bolster the China-Kyrgyzstan-Uzbekistan (CKU) rail system. As tensions between Nur-Sultan and Moscow continue to simmer, the China-Russia-Kazakhstan triangle may become more prominent in the months and years ahead.

Russia reportedly arrests two scientists for spying for China

Russian counterintelligence claims to have arrested two Russian scientists for providing sensitive material to China. According to Moscow, Dmitry Kolker and Anatoly Maslov were working on lasers and hypersonics, respectively, in the city of Novosibirsk, while also allegedly supplying “state secrets” to Chinese security services. Kolker died two days after his arrest, reportedly from causes related to stage four pancreatic cancer.

While the true story may never be known (and one should resist making any conclusions), it’s significant that Russian authorities were willing to publicize the cases.

• Though the case was absent from Russia’s English-language state media outlets, TASS and other state news agencies reported on the story, suggesting that elements within the FSB (the Russian domestic security service) and the Russian state are willing to enforce red lines against Chinese espionage.
• For more on the story, as well as a conjecture that Beijing’s zero-COVID policy may have indirectly exposed the spy ring, please read the China-Russia Report’s analysis.

The Kremlin denies reports that Xi Jinping rejected Putin’s invitation to visit Russia

Russian state media outlets denied reports from Japanese news agencies that Xí Jìnpíng 习近平 turned down an offer to visit Putin in Russia during their conversation on June 15. While it is plausible that Putin extended an invitation to Xi, it seems more likely that the story is untrue: An official visit to Moscow by Xi, while Putin’s invasion rages on, would almost certainly be regarded as an extraordinarily provocative act by Brussels and Washington, and would likely do serious damage to Beijing’s economic and political relationship with the West.

Putin (hopefully) understands the limits of the Beijing-Moscow axis and likely wouldn’t ask his counterpart to risk ties with Brussels and Washington for a photo op.