Russia plans to raise gas prices by 20% each year to save loss-making Gazprom
Russian authorities are discussing a possible sharp increase in gas prices for industry to cover the budget deficit of Gazprom, which is suffering losses after losing the European market, the Russian news agency Interfax reported.
Under the new plan, gas tariffs for industrial consumers may increase by 10% twice a year – in the first and fourth quarters.
This is more than double the government's current plan, which envisages indexing gas tariffs for industry by 10.3% this year, and then by 10.6%, 9% and 7% respectively in 2026-2028.
The price of gas for the population is set to increase by the same amount – a total of 42.2% for 2026-2028. Taking into account indexations in the previous three years, the accumulated increase in gas tariffs since the beginning of the war will reach 76%.
After the start of a full-scale war in Ukraine, Russia's Gazprom lost most of its exports to Europe.
If previously the volume of supplies to the EU reached 200 billion cubic meters each year, now they have fallen several times – to 28–32 billion cubic meters.
Total exports abroad have dropped to their lowest levels in almost 40 years – to 69 billion cubic meters in 2023 and 81 billion in 2024.
In 2023, the company suffered a record loss of 629 billion rubles ($8.01 billion). In 2024, losses reached another 1 trillion rubles ($13 billion).
According to Gazprom's own estimates, the company will have a negative cash flow of 15 trillion rubles ($190 billion) over the next decade.
- In April, Russia's oil and gas revenues fell by almost 12% year-on-year.
- Russia tripled its budget deficit due to a loss of $33 billion in oil and gas revenues.
