In its most recent intelligence update, it was noted that on July 1, Russia implemented an 11.2 per cent increase in domestic gas prices, likely aimed at boosting domestic revenues amid reduced gas exports to Europe.
This pricing adjustment follows sanctions imposed on Russia in response to its invasion of Ukraine, which led to deliberate cuts in gas exports to Europe. Additionally, it was highlighted that Gazprom reported a net loss of approximately 629 billion rubles ($6.9 billion) in 2023, marking its largest annual loss in 25 years.
Gazprom, being the largest state-owned energy company with a monopoly on domestic market supplies, regulates price increases under the oversight of the Russian government. This regulatory framework does not extend to other producers like Novatek, which hold smaller market shares.
„Inflation in Russia is highly likely to remain above the Central Bank of Russia's target of 4 per cent in the second half of 2024. This is partly due to increases in domestic gas proces alongside other rising household bills and increased government spending - which is maily driven by Russia's rising defence spending on the war in Ukraine,” the assessment stated.
It was observed that despite Russia being the world's second-largest producer of natural gas in 2023, gas prices for Russian households have increased by approximately 34 per cent since the invasion began. Additionally, projections indicate that prices are likely to rise by another 8.2 per cent in 2025, which is expected to add to inflationary pressures in the Russian economy and diminish the purchasing power of its citizens.
Source: PAP/x.com/@DefenceHQ
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