The Power Within: The Kyiv Independent’s first-ever magazine. Be among the first to get it.

pre-order now
Skip to content
Edit post

Russia to increase taxes on struggling energy giant Gazprom this year

by Dominic Culverwell and The Kyiv Independent news desk May 12, 2024 7:21 PM 2 min read
Gazprom PJSC Slavyanskaya compressior station, the starting point of the Nord Stream 2 gas pipeline, in Ust-Luga, Russia, Jan. 28, 2021. (Andrey Rudakov/Bloomberg via Getty Images)
This audio is created with AI assistance

Russia will increase taxes on its national energy giant Gazprom despite the company suffering record losses, the British Ministry of Defense (MoD) wrote in its daily update on May 12.

Gazprom’s revenue fell by 30% last year with a net loss of $6.9 billion, the largest in 25 years. Russia’s full-scale invasion of Ukraine led to worsening relations with Europe, limiting the operations of the company.

The energy giant relied on European markets and failed to find alternatives after the EU moved away from Russian gas. While Gazprom found some success in other foreign markets, this only accounts for five to 10 percent of its European sales.

Moscow has heavily taxed Gazprom’s revenues over the last two years and the company paid $28 billion to the government in 2023, accounting for nine percent of the government’s revenue last year.

The decision to further increase taxation means Gazprom has cut investment this year by 15 percent, the British MoD said. The company’s profits will be restricted until 2030, the MoD believes.

In seeking new markets, Russia has been forced to export natural gas at reduced prices. The Russian Economy Ministry published a report setting gas exports' price to China at $257 per 1,000 cubic meters compared with $320.30 for Western markets.

In September 2023, the company announced that its gas production dropped by 25%. Gazprom blamed the fall on "the adoption in a number of countries of politically motivated decisions aimed at refusing to import Russian gas" in particular.  

In May 2023, the EU and G7 agreed to ban Russian gas imports on routes where Moscow has cut supplies before, in order to prevent the restart of Russian pipeline gas exports on routes to countries such as Poland and Germany.

EU countries are still importing Russian liquified natural gas (LNG) but the European Parliament voted on April 11 to pass rules allowing member states to ban the imports. The policy aims to create a legal route for blocking gas deliveries by preventing Russian and Belarusian companies from booking gas infrastructure capacity.

Russia’s new Kharkiv offensive pushes Vovchansk to the brink of annihilation
VOVCHANSK, KHARKIV OBLAST – The glide bombs arrive in groups of three. Their flight can be heard from far away, but only in the last second before impact is it clear where it will hit. The explosions, orders of magnitude more powerful than regular artillery shells, shake the ground where the

News Feed

7:21 PM  (Updated: )

Trump says 'nobody is asking' Ukraine to recognize Crimea as Russian.

"Nobody is asking (President Volodymyr) Zelensky to recognize Crimea as Russian Territory, but if he wants Crimea, why didn’t they fight for it eleven years ago when it was handed over to Russia without a shot being fired?" U.S. President Donald Trump wrote.
8:06 AM  (Updated: )

Zelensky visits South Africa but cuts trip short after mass Russian strike.

"We count on South Africa’s meaningful participation in the International Coalition for the return of thousands of Ukrainian children abducted by Russia. We will also certainly strengthen our cultural and educational ties," President Volodymyr Zelensky said.
5:30 AM

Trump says he may meet Putin 'shortly' after May Middle East visit.

Despite ongoing ceasefire negotiations, Trump and Putin have yet to have direct contact, communicating only through their officials. Trump's last in-person encounter with his Russian counterpart was during the 2018 Helsinki Summit during the U.S. president's first term.
MORE NEWS

Editors' Picks

Enter your email to subscribe
Please, enter correct email address
Subscribe
* indicates required
* indicates required
Subscribe
* indicates required
* indicates required
Subscribe
* indicates required
Subscribe
* indicates required
Subscribe
* indicates required

Subscribe

* indicates required
Subscribe
* indicates required
Subscribe
* indicates required
Explaining Ukraine with Kate Tsurkan
* indicates required
Successfuly subscribed
Thank you for signing up for this newsletter. We’ve sent you a confirmation email.