- Gazprom’s European market share plunged from 35% to 7% due to sanctions, forcing massive layoffs and asset sales.
- Attempts to pivot to China face obstacles, with export revenue projected to drop by up to 80% by 2030.
Gazprom, a natural gas distribution company in Russia, is struggling with heavy losses and drastic job cuts after losing nearly all of its European market due to the war in Ukraine.
The company, once Russia’s most valuable, is now considering selling luxury properties, including a lavish palazzo-style building in St. Petersburg that once symbolised its dominance in European gas exports.
Gazprom has suffered more than any other Russian business under Western sanctions. Sources inside the company say CEO Alexei Miller has approved plans to cut 1,500 jobs at its headquarters in Russia’s tallest skyscraper, the Lakhta Centre. Employees must now justify their positions as part of a downsizing effort.
Before sanctions, Gazprom controlled over 35% of the European gas market. That share has now dropped to just 7%, with the U.S. emerging as Europe’s top liquefied natural gas (LNG) supplier. The European Union has vowed to end its reliance on Russian fossil fuels by 2027.
Once thriving with 600 employees, Gazprom’s export division has been reduced to a few dozen staff members focused mainly on legal disputes with former European buyers. A company source described it as “just a shell.”
Despite higher energy costs, Europe has not reversed sanctions. “We thought Europe would come begging for gas,” one Gazprom executive admitted. “We were wrong.”
Gazprom reported a $7 billion loss in 2023—its first since 1999—and continued losses in 2024. Its share price hit a 15-year low in December 2024 but partially recovered after Donald Trump’s return to the White House raised hopes of a Ukrainian peace deal.
However, European leaders have shown no interest in resuming Russian gas imports. Germany has ruled out reviving the Nord Stream pipeline, which remains damaged and out of service.
Russia has attempted to shift its gas exports to China, but progress has been slow. Only one major pipeline—the Power of Siberia—transports Russian gas to China. Plans for a second and third pipeline remain stalled due to price disputes.
Even if new pipelines are built, analysts predict Gazprom’s gas export revenue could drop by up to 80% by 2030 compared to its 2022 peak of $165 billion.
Gazprom was once a powerhouse, contributing over 5% of Russia’s GDP. CEO Alexei Miller, a close ally of President Vladimir Putin, has led the company for 24 years.
As its European market disappears and Chinese exports remain uncertain, Gazprom is adjusting to a smaller role as a domestic gas supplier. Neither Gazprom nor Russia’s energy ministry responded to requests for comment.