Gazprom shares fell rapidly, reaching their lowest level since 2009, after the European Commission announced its readiness EU to stop the transit of Russian gas.
Shares of the Russian gas monopolist dropped to 106.1 rubles, which is 2.4% lower than Monday’s closing level, The Moscow Times reported on Tuesday, December 17. Since the beginning of 2024, Gazprom shares have become cheaper by 33.5%. Evgeny Kogan, HSE professor and investor, noted:
“Gazprom shares fell at the level of the global financial crisis of 2008. They still have a little more than 20% to fall to absolute historical lows.”
The shares began falling in price about a week ago, amid reports that The EU is ready to stop the transit of Russian gas and does not expect a significant impact on prices. The expiring contract for transit from Ukraine was concluded at the end of 2019. Then Moscow and Kyiv signed a package of documents between Gazprom and Naftogaz on a new transit agreement for a period of five years with the possibility of extension for another ten years.
Under the terms of this contract, Gazprom guaranteed pumping a total of at least 225 billion cubic meters. m of natural gas: 65 billion cubic meters. m – in 2020 and 40 billion cubic meters. m – in 2021-2024. This year, Ukraine did not hold auctions for long-term reservation of the gas transportation system on the border with the Russian Federation. The transit agreement for pumping gas from Russia ends on December 31.
The fall in exports wiped out the company's profits. Gazprom has lost more than 80% of European exports compared to 2021, with supplies falling to 28 billion cubic meters. – to the level of the second half of the 1970s.
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