In the first half of this year, Russia’s gas production giant, Gazprom, experienced a substantial drop in gas production, recording a nearly 25 % decline year-on-year to 179.45 billion cubic meters. This announcement was made by the company, which has recently grappled with a significant reduction in gas exports to Europe, as reported by Reuters.
In late August, Gazprom disclosed that its net profit for the first half had plummeted to 296 billion rubles (approximately 70 billion crowns), down from the previous year’s 2.5 trillion rubles.
During the second quarter alone, Gazprom transitioned from a profit of 1.03 trillion rubles a year ago to a loss of 18.6 billion rubles.
Gazprom holds the world’s largest natural gas reserves and maintains a monopoly on exporting this strategically vital resource from Russia through pipelines. Gazprom’s Deputy Director, Famil Sadygov, noted in August that while exports to Europe declined, there was some compensation from the growing supplies to China.
The situation surrounding Russian gas supplies to Europe became intricate following Russia’s attack on Ukraine last February, leading the European Union to impose a series of sanctions against Russia. Additionally, last year, Russia ceased the operation of the Nord Stream 1 pipeline, which transported Russian gas across the Baltic Sea to Germany, with a capacity of up to 167 million cubic meters per day.