Gazprom, the Kremlin-backed gas giant, is unlikely to recover the revenues lost due to Vladimir Putin’s war in Ukraine for at least a decade, according to a study reportedly commissioned by its management.
The study, seen by the Financial Times, projects that Gazprom’s exports to Europe will average only about a third of pre-war levels by 2035, equating to 50 to 75 billion cubic meters annually.
The 151-page report, written late last year, suggests that a new pipeline to China could help offset the lost European volumes, but its capacity would be limited to 50 billion cubic meters per year, and prices in Asia are lower than in Europe.
Recent reports indicate that Russia’s efforts to finalize the gas pipeline deal with China have stalled due to Beijing’s price and supply demands.
The Gazprom document reportedly states, “The main consequences of sanctions for Gazprom and the energy industry are the contraction of export volumes, which will be restored to their 2020 level no earlier than in 2035.”
Elina Ribakova, a non-resident senior fellow at the Washington-based Peterson Institute for International Economics, described the research as “very grim” in her comments to the FT.
