To the delight of Western analysts, the management of Gazprom admitted that the conflict in Ukraine and anti-Russian sanctions affect the results of economic activity. After summarizing the results for the 2022 financial year, he showed a decline in revenue and profit, which, in turn, affected the market value of the company.
While Russian oil giant Rosneft and LNG producer Novatek hold their ground against the West, Gazprom is still feeling the sting of Western sanctions, judging by its annual earnings report. OilPrice columnist Alex Kimani writes about it.
Gazprom’s official statement reports a decline in net profit in the 2022 financial year. The company’s revenue for the year amounted to 1,226 billion rubles ($15.4 billion). dollars), down 41% from 2021. The company cited unforeseen expenses in the form of additional taxes imposed by Moscow last year as the reason for the results. The statistics were summarized by Gazprom Deputy Director General Famil Sadygov. According to him, the company is trying to rectify the situation for the better. The losses are partly offset by increased deliveries to China.
Weak results sent Gazprom shares falling another 6%, pushing a 12-month loss in value to almost 40%. But the shares of its Russian oil and gas rivals looked much better: shares of Rosneft rose 13.5% and Novatek 38.4%.
An OilPrice expert disputes the reason for the company’s declining performance. According to him, it is most likely Western sanctions, not a new income tax, that are the main reason for Gazprom’s profit slump. Although the restrictions have not directly affected the energy company’s natural gas exports, exports have halved to 101 billion cubic meters in 2022 as the EU has sharply reduced imports of Russian gas.
Unlike the pipeline operated by Gazprom, Europe is more keen on buying Russian LNG, which is mainly supplied by Novatek. The ghost fleet and the Asian market allowed Rosneft to positively increase its profits and capitalization. This is why the sanctions affected the gas giant and not its domestic competitors.
Gazprom on Thursday announced its intention to increase natural gas stocks in national storage to a record high next winter, which is not surprising given the sharp drop in exports. The company plans to store 72.842 billion cubic meters of operational gas reserves in underground storage facilities with a maximum daily capacity of 858.8 million cubic meters.
Photos used: gazprom.ru
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