Russia’s under-pressure economy and Vladimir Putin have been dealt a devastating blow after state-controlled gas giant Gazprom recorded a huge net loss of $12.89B (£9.9bn) in 2024. The company’s financial woes were compounded by plummeting share prices in its subsidiary Gazpro Neft and an increased income tax rate of 25%.
This greatly raised tax liabilities for the company, leading to billions of pounds lost and follows a historic 2023 where Gazprom revealed a net loss for the first time in 25 years, recording a historic deficit of 629 billion rubles ($7.6 billion). The huge financial blow has had a knock on effect to its employees with Russian sources sharing that the gas giant’s CEO, Alexei Miller, has now approved plans to cut 1,500 jobs.
This is across the parent company’s headquarters in Russia and Europe’s tallest skyscraper, the British-designed Lakhta Centre, also in St Petersburg.
After announcing its first annual loss, Gazprom said last year that it was selling a portfolio of high-end properties, including well-known luxury hotels in Moscow.
The former Chief of the National Bank of Ukraine, Kyrylo Shevchenko, has branded the business as « Russia’s most unprofitable company ».
Writing on X, he said: « Russian #Gazprom closes 2024 with a staggering $12.89B net loss – twice its 2023 record of $6.1B, cementing its place as Russia’s most unprofitable company. The downturn stems from plummeting shares of Gazprom Neft, its oil subsidiary. »
Gazprom attempted to clutch onto its presence in Europe, yet gas exports to countries on the continent remained low. This follows Russia’s full-scale invasion of Ukraine and the EU’s decision to reduce reliance on energy from Vladimir Putin’s country.
2023 saw the company deliver nearly six times less cubic meters of gas than its peak in 2018-2019. This can be partly attributed to Russia’s direct pipeline gas supplies being ceased completely.
To fill the void of gas supplies, the United States quickly became the biggest export of liquefied natural gas (LNG) to the continent, with supplies tripling since 2021, Reuters reports.
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