Gazprom – a symbol of the Russian economic disaster: This week, the company's shares fell to their lowest level since 2009. At some point on Wednesday the share price was 105.75 rubles. Meanwhile, even before the full-scale invasion, Gazprom's shares were trading at around 300 rubles. However, you don't have to look that far. In October, the company's shares reached the level of 140 rubles.
Why are Gazprom shares falling so much? There are several reasons. After Gazprom reported its first annual loss since 1999 in May, its finances are in an increasingly worse condition. In the third quarter of this year the largest gas producer in Russia suffered a loss of 53 billion rubles ($492.5 million). In the same period, the company had 56.4 billion rubles ($529 million) in profit. The collapse is gigantic.
Europe is cutting itself off from Russian gas: However, Gazprom's declining profits did not come out of nowhere. Last week, the Austrian company OMV announced that terminated its long-term contract with the Russian Gazprom for gas supplies. There are more problems around the corner. Bulgaria has warned that it will stop the transit of Russian gas through its territory if Russia's Gazprom does not find a way to pay for the service, and Moldova has declared a state of emergency to import gas from other sources.
What about Nord Stream 2? The United States also added its two cents. This week, the Americans announced further sanctions on several Russian entities in connection with their involvement in the Nord Stream 2 gas pipeline. Vedant Patel from the State Department said that The US maintains its opposition to Nord Stream 2 and efforts to revive it. – We will continue to work and make sure that Russia will never be able to weaponize its energy resources and its energy position for political gain – he declared.
Will China help Gazprom? Katja Yafimava, senior researcher at the Oxford Institute for Energy Studies, explained in an interview with Business Insider that “Gazprom has lost the European gas market”, so its only hope will be the large domestic market and the Chinese market. The Russians are seeking an uprising Power of Siberia 2, Russia-China pipeline, which would significantly increase exports to China.
Read also: “Russia has a poverty problem. They are implementing a solution well known to Poles from the Polish People's Republic“.
Sources: : rbc.ru, businessinsider.com, Reuters, investing.com, Next.gazeta.plIAR