Russia’s Natural Gas Production Hits a Low Point
Russia’s natural gas production has taken a big hit, according to Russian media outlet Kommersant. The country produced 57.2 billion cubic meters (bcm) of gas in February, which is 11.3% less than last year.
The main reason for the decline is that Ukraine stopped allowing Russia to send gas through its territory on January 1. This has severely impacted Gazprom, Russia’s state-owned gas giant. The company’s production fell by 13.2% to 38.2 bcm in February.
Gazprom now relies almost entirely on the TurkStream pipeline, which can only carry about half of what Ukraine used to allow. This makes it hard for Russia to send gas to Europe.
Other major Russian energy companies also saw a decline in production. Novatek‘s output fell by 1.5% to 6.4 bcm, while Lukoil’s production dropped by 13.3% to 1.3 bcm. Rosneft’s production was down by 14%, and Gazprom Neft’s production fell by 8.3%.
The decline in gas production went beyond Russia’s borders. Gazprom Neft’s production in Serbia, Iraq, and Kurdistan fell by 20.5%. Rosneft’s output at Egypt’s Zohr field declined by 21.3%.
Only a few projects maintained their 2024 levels of production. Sakhalin-1 and Sakhalin-2 kept producing the same amount of gas as last year.
Despite the decline, Russian price agencies think that gas production will stay at the same level in 2025. This is because Moscow is focusing on sending more gas to China through pipelines and increasing liquefied natural gas (LNG) shipments.
Ukraine’s decision to stop allowing Russia to send gas through its territory has had big consequences for Gazprom. The company now relies on a pipeline that can only carry about half of what Ukraine used to allow.
The decline in gas production is also having an impact on other Russian energy companies. Novatek, Lukoil, Rosneft, and Gazprom Neft all saw a drop in their production levels.
Russia’s reliance on pipelines has been further highlighted by the recent crisis with Ukraine. The country now relies heavily on TurkStream pipeline, which can only carry about half of what Ukraine used to allow.
Ukraine’s decision to stop allowing Russia to send gas through its territory has put pressure on Gazprom and other Russian energy companies. The decline in production is likely to continue unless a new agreement is reached with Ukraine.