Russia’s booming trade with China, which surged to record highs after Western sanctions cut Moscow off from global markets, is now showing signs of decline.

Bilateral turnover fell 8.1% year-on-year in the first seven months of 2025, driven by a drop in Russian oil exports to China and weaker Chinese vehicle sales in Russia, according to Chinese customs data. Trade reached an all-time high of $245bn in 2024.

The slowdown comes as President Vladimir Putin prepares to meet President Xi Jinping at a Shanghai Cooperation Organisation (SCO) summit in Tianjin this weekend. Russian officials told Reuters that both sides are working to identify areas for expansion, with agriculture and energy seen as potential growth sectors.

Putin will join more than 20 leaders at the summit, including India’s Narendra Modi. The gathering follows his recent trip to Alaska, which Moscow hailed as a diplomatic breakthrough.

China has become Russia’s most important trading partner since the invasion of Ukraine in 2022, when the two countries declared a “no limits” partnership. Beijing’s imports of Russian oil and supply of technology have helped Moscow keep its economy afloat and sustain its military production.

“Without China, the economy would have collapsed long ago,” one Russian source said, acknowledging Moscow’s dependence on Chinese components for weapons production.

Yet despite official rhetoric about a “friendship of steel,” some Russian insiders admit Beijing acts strictly in its own interests. “China does not behave like an ally,” one said. “Sometimes it takes advantage, sometimes it lets us down. There is nothing allied about it.”

The summit is expected to test whether both sides can reinvigorate trade ties that are central to their efforts to challenge Western dominance.