Russian fossil fuel giant Gazprom has lost $11 billion for the 2023 fiscal year, and is set to lose even more as a gas transit agreement to Europe via Ukraine expires, Danil Getmantsev, chair of the Committee on Finance, Taxation and Customs Policy of the Ukrainian parliament, said on Telegram on Jan. 15.

“In 2024, the transit agreement on gas transportation to Europe through Ukraine will expire, and its extension is not even being considered (and this is another minus 15 billion cubic meters in the European direction),” said the lawmaker.

“Turkey is increasing its own gas production, in particular from the 58 billion cubic meter field discovered at the end of 2022, and its full capacity will cover up to 28% of the country’s total consumption.”

China has once again refused to participate in the construction of Power of Siberia 2, as it sees no economic sense in it due to the diversification and contracting of all demand through 2030, as well as the prospects for accelerating its alleged green transition, Getmantsev added.

“Russia might want to invest in another political gas project (it is no stranger to it), but it has nothing to (invest): for the fiscal year ended June 30, 2023, Gazprom received a trillion rubles ($11.4 billion) in net losses, found itself in a state of deep cash shortage, which is why it spent 2/3 of its cash reserves on its accounts,” the MP stated.

He noted that there is no additional revenue source for the Russian company, as  production in the first half of the year fell by a quarter compared to pre-war levels.

Read also: Gazprom discloses surging gas exports to China, but volumes still fall far short of lost EU market

“And then there is also the need to finance the national gasification program,” Getmantsev said.

“The latter will be partially paid for by (loyal) consumers – from July 2024, the gas tariff for them will increase by 11.2%, and from July 2025 – by another 8.2% (thus, since the beginning of the war, the price for ‘denazification’ will increase by 34% cumulatively), but this is not enough. As a result, it is expected that by 2025, Gazprom may record another trillion rubles ($11.4 billion) in losses.”

Russian gas supplies to the EU countries have reportedly fallen by 65% in 2023 and amounted to about 20-25 billion cubic meters, which is seven times less than in pre-war 2021 when the company supplied 140 billion cubic meters.

The Russian monopolist supplied 22.7 billion cubic meters of gas to China in 2023. This is 700 million cubic meters more than Gazprom’s contractual obligations and one and a half times more than in 2022 when supplies amounted to 15.4 billion cubic meters.

Gazprom announced that in early January 2024, the company brought daily gas supplies to China “to a fundamentally new level,” and on Jan. 2, this new level was exceeded, and Gazprom updated the historical record of daily pipeline gas exports to Chinese consumers,

Read also: Finland plans to halt Russian gas imports by 2025

The contractual volume of supplies from Russia to China for 2024 stands at 30 billion cubic meters compared to 22 billion cubic meters in 2023. In 2025, the Power of Siberia gas pipeline should reach its full export capacity of 38 bcm per year.

Gazprom announced at the end of December 2023 the commissioning of new production facilities necessary for the new planned increase in exports to China: at the Kovykta field in Irkutsk Oblast and the Chayanda field in Yakutia.

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