Gazprom announced on Monday 15 February that its exports to Europe will decrease in 2020 due to the collapse of the gas market. The year was marked by a drop in prices and demand for hydrocarbons due to the coronavirus pandemic. Gazprom is also suffering from the delicate situation facing the Nord Stream 2 project.
Gazprom’s exports fall by 12%.
Less of a drop in exports than expected
Gazprom and its exports to Europe, including Turkey, fell by 12.1% in 2020. Over the year, this represents 174.87 billion m3 exported, compared to 198.97 billion m3 in 2019. However, this result exceeds Gazprom’s expectations. The Russian company’s ambition was to export 166.6 billion to Europe in 2020.
Uncertainties about Nord Stream 2
The Russian company ‘s desire to increase its sales in Europe has been thwarted in particular by the uncertainty surrounding the Nord Stream 2 gas pipeline between Russia and Germany. Work on the pipeline resumed in December, after a year’s suspension due to threats of US sanctions.
The United States and several European countries, such as Poland, take a dim view of this new pipeline. They believe that it will increase the dependence of Germany and the European Union (EU) on Russian gas and therefore on Moscow.
Gazprom’s global sales fall by 8.1% in 2020
Gazprom sold a total of 209.7 billion cubic meters last year on all its pipeline markets. This is down from 228.2 billion m3 in 2019.
The political tensions at the beginning of the year between Russia and the European Union are likely to impact Gazprom’s exports to Europe. The Russian gas giant is now looking to China to sell its gas. Launched in late 2019, the Power of Siberia pipeline delivered 4.1 bcm of gas in 2020 and is expected to reach 10 bcm in 2021.