Russia's Gazprom plans to reduce its investments as gas exports decline
Russian energy giant Gazprom announced Thursday that it intends to reduce investment spending by a fifth next year amid a decline in gas exports to Europe and tax burdens.
Since war broke out in Ukraine in February 2022, European countries have sharply reduced gas imports from Russia in an attempt to limit Moscow's ability to finance its war.
The Kremlin relied on oil and gas export revenues to finance the war in Ukraine, and last year it announced huge tax increases on this industry to cover its defense budget.
While Gazprom shifted some of its exports to China and Turkey, it reduced its gas production by a quarter in the first half of this year as it sought to compensate for declining sales.
The company said that its investment spending on energy and infrastructure projects next year will be reduced by about 20 percent year-on-year to 1.57 trillion rubles ($17.8 billion).
She added in a statement, “The approved financial plan will ensure that Gazprom covers its obligations in full without a deficit.”
Ruling party lawmaker Pavel Zavalny warned earlier this month that Gazprom's losses could reach 1 trillion rubles in 2025, partly due to heavy tax burdens.
The company achieved profits of 296 billion rubles in the first half of this year, a small fraction of the profits that reached 2.5 trillion rubles in the first half of 2022.
