TOP-5 miscalculations of Gazprom in numbers or why its prospects are like dinosaur’s?
Maksym Bielawski, Leading Expert of Energy Programmes at the Razumkov Centre, identified TOP-5 miscalculations of Gazprom.
1. Unprofitability. According to IFRS for 9 months of 2020, losses amounted to $2.7 billion. This result was facilitated by a reduction in natural gas production and exports. In 2020 production volumes fell by 9% (452.7 billion cubic meters) and exports by 10% (179.3 billion cubic meters). The procurement of Russian gas was significantly reduced by both domestic consumers and the foreign market – Germany, Italy and Turkey. The losses of the pipeline gas market do not cover the deliveries through LNG terminals, which increased in 2020 only by 2%.
2. Strategic loss of markets. One of such examples is Turkey. In 2020, Russian gas supplies to Turkish consumers significantly decreased and amounted to approximately 8 billion cubic meters, or 27% of contract volumes, which is more than three times less than in 2014. This trend will be reflected in future contracts. For example, the contract between Gazprom and Botas (8 billion cubic meters/year) comes to an end in 2021, and the contract for fuel transportation through “Blue Stream” (16 billion cubic meters/year) – in 2025.