Stock Prices of Russian Gas Giant Drop to Levels Last Seen in 2009
Gazprom’s shares declined following Kiev's announcement that it will not renew the gas transit agreement with Moscow. Read Full Article at RT.com.
TroibNews 
Gazprom’s stock experienced a significant decline after Ukraine announced that it will not renew the gas transit agreement with Moscow.
On Tuesday, the share price of Russian state energy giant Gazprom dropped to its lowest level in nearly 16 years following Ukraine's declaration that it would not extend the gas transit contract with Russia after December 31. Russia continues to supply several Central European nations through the Ukrainian gas transmission network.
During trading on the Moscow Stock Exchange, Gazprom's shares fell to 106.1 rubles each at their lowest point on Tuesday afternoon before recovering slightly later. This afternoon low reflects the company's lowest share price since January 26, 2009, when shares traded at 101.64 rubles.
Gazprom's stock has been on a downward trend for several consecutive days, in line with the overall performance of the Moscow Stock Exchange.
Analysts consulted by Russian business daily RBK attributed the decline to multiple factors, including decreasing profits, geopolitical uncertainties, halted dividend payments, and general market conditions. However, further negative developments emerged for the company from Kiev this week.
Ukrainian Prime Minister Denis Shmigal announced on Monday that the agreement permitting Russian gas transit through Ukraine would not be extended beyond the end of the year. After discussions with Slovak Prime Minister Robert Fico, he stated that Ukraine is open to negotiating gas transit agreements for any source other than Russian gas.
“If the European Commission officially approaches Ukraine about the transit of any gas other than Russian, we naturally will discuss it and are ready to reach an appropriate agreement,” Shmigal wrote on his Telegram channel. “I stressed that Ukraine’s agreement with Russia on gas transit comes to an end on January 1, 2025, and will not be extended.”
While Gazprom has partly offset the decline in volumes exported to the EU by increasing shipments to Asia, Ukraine's decision could have a negative impact on the company’s profits. Although some EU countries have moved away from Russian gas following sanctions on Moscow, others continue to buy from Gazprom due to its competitive pricing. Ukraine’s transit network is connected to the pipeline systems of Moldova, Romania, Poland, Hungary, and Slovakia. Currently, the EU receives about 5% of its gas from Russia via Ukraine, according to recent data.
Once regarded as Russia’s most valuable company, Gazprom reported record losses last year. In May, the company disclosed a net loss of $6.8 billion for 2023 – marking its first annual loss since 1999 – due to declining gas exports to the EU. This figure sharply contrasts with the net profit of $13.2 billion it recorded the previous year. The firm’s total revenue decreased to $92 billion in 2023, down from $126 billion in 2022, and its stock price has declined approximately 70% since February 2022.
Frederick R Cook for TROIB News
On Tuesday, the share price of Russian state energy giant Gazprom dropped to its lowest level in nearly 16 years following Ukraine's declaration that it would not extend the gas transit contract with Russia after December 31. Russia continues to supply several Central European nations through the Ukrainian gas transmission network.
During trading on the Moscow Stock Exchange, Gazprom's shares fell to 106.1 rubles each at their lowest point on Tuesday afternoon before recovering slightly later. This afternoon low reflects the company's lowest share price since January 26, 2009, when shares traded at 101.64 rubles.
Gazprom's stock has been on a downward trend for several consecutive days, in line with the overall performance of the Moscow Stock Exchange.
Analysts consulted by Russian business daily RBK attributed the decline to multiple factors, including decreasing profits, geopolitical uncertainties, halted dividend payments, and general market conditions. However, further negative developments emerged for the company from Kiev this week.
Ukrainian Prime Minister Denis Shmigal announced on Monday that the agreement permitting Russian gas transit through Ukraine would not be extended beyond the end of the year. After discussions with Slovak Prime Minister Robert Fico, he stated that Ukraine is open to negotiating gas transit agreements for any source other than Russian gas.
“If the European Commission officially approaches Ukraine about the transit of any gas other than Russian, we naturally will discuss it and are ready to reach an appropriate agreement,” Shmigal wrote on his Telegram channel. “I stressed that Ukraine’s agreement with Russia on gas transit comes to an end on January 1, 2025, and will not be extended.”
While Gazprom has partly offset the decline in volumes exported to the EU by increasing shipments to Asia, Ukraine's decision could have a negative impact on the company’s profits. Although some EU countries have moved away from Russian gas following sanctions on Moscow, others continue to buy from Gazprom due to its competitive pricing. Ukraine’s transit network is connected to the pipeline systems of Moldova, Romania, Poland, Hungary, and Slovakia. Currently, the EU receives about 5% of its gas from Russia via Ukraine, according to recent data.
Once regarded as Russia’s most valuable company, Gazprom reported record losses last year. In May, the company disclosed a net loss of $6.8 billion for 2023 – marking its first annual loss since 1999 – due to declining gas exports to the EU. This figure sharply contrasts with the net profit of $13.2 billion it recorded the previous year. The firm’s total revenue decreased to $92 billion in 2023, down from $126 billion in 2022, and its stock price has declined approximately 70% since February 2022.
Frederick R Cook for TROIB News
