The toll of EU sanctions against Russia is beginning to tell, as Russian state owned oil giant, Gazprom, has complained that its natural gas exports to customers outside the Commonwealth of Independent States (CIS) have plunge by 43% between January and October, as Russia has been forced to drastically cut its pipeline gas deliveries to Europe.
Gazprom is a Russian majority state-owned multinational energy corporation. As of 2019, when the company posted sales over $120 billion, it was ranked as the largest publicly listed natural gas company in the world and the largest company in Russia by revenue.
Yesterday, the company said demand for its gas had dropped, especially in Europe, which accounted for most of the decline in global gas consumption between January and October.
It said that its gas supply to countries other than CIS members – Azerbaijan, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan – averaged 91.2 bcm to its other customers in Europe and Asia.
Stating the position on the development, Russian state energy company said on its Telegram channel yesterday quoted by Montel, that Gazprom’s natural gas production dropped by almost 19% in the ten months to October compared to the same period of last year.
Of course, the major drop in Gazprom’s gas deliveries to key customers was due to the halt of Russian gas exports to nearly all European countries. Weeks after the invasion of Ukraine, Russia cut off supply to Poland, Bulgaria, and Finland.
Several weeks later, Gazprom started to reduce supply via the Nord Stream pipeline to Germany in June, claiming an inability to service gas turbine maintenance outside Russia due to the Western sanctions against Moscow for the invasion of Ukraine.
Gazprom said in early September that Nord Stream would remain shut until “operational defects in the equipment are eliminated,” upping the ante in its gas war against Europe.
At the end of September, gas leaks were detected from the now-shut Nord Stream 1, as well as its twin pipeline Nord Stream 2, which was never put into operation. The lines were found to have been sabotaged, and earlier this week, Russia accused the British Navy of blowing up the pipelines.
Soaring gas prices and Europe’s efforts to replace Russian gas deliveries have forced many industries to curtail or halt operations as energy costs have surged, Oilprice said yesterday