Putin's turnaround: Gazprom's tax relief threatens Russia's economy!

Putin's turnaround: Gazprom's tax relief threatens Russia's economy!

Moscow in crisis – the flagship of the Russian energy industry, Gazprom, is on the brink! A catastrophic decline in revenues is looming, and the Kremlin may soon have to foot the bill. Vladimir Putin wanted to profit significantly from the energy sector, but the gloomy forecast for the next few years does not bode well. The red numbers are getting closer and hope is fading!

Like a dark cloud over the Russian economy, the latest figures show a dramatic decline in revenues from the oil and gas sector. According to the newly released draft budget, revenue is expected to fall from a shocking 11.3 trillion rubles in 2024 to just 10.9 trillion rubles in 2025. But that's not the end of the story - by 2027, revenues threaten to fall to a paltry 9.77 trillion rubles! A real shock for Putin's war chest, which relies on these funds.

Gazprom's tax cut is shaking up the entire system!

Behind this financial misery lies a devastating decision: the government is granting Gazprom, Russia's largest gas producer, massive tax breaks. The mineral extraction tax will be reduced by more than 30 percent by 2025, which corresponds to a massive reduction of 550 billion rubles! An attempt to save the ailing giant, but the consequences are devastating for the state treasury.

The situation is precarious! Gazprom had to report losses for the first time since 1999. While the company exported over 174 billion cubic meters of natural gas to Europe in 2021, the number collapsed to a pitiful 28.3 billion cubic meters in 2023. A decline that spreads like a storm across the entire economy.

But that's not all - the road to Asia remains rocky! Gazprom aims to increase exports to China, but lacks the necessary infrastructure to transport gas in sufficient quantities. The Power of Siberia project cannot deliver the capacity needed to offset losses in Europe.

Putin's dream of the energy market appears to be shattered

But the biggest obstacle is the price! Russia simply cannot agree with China on an acceptable selling price for the natural gas. This means that the construction of the “Power of Siberia 2” pipeline is stalling. A dramatic dilemma for Gazprom, whose lifeblood is gas revenues!

The future of Gazprom and with it Vladimir Putin's economic plans is in the balance. The Kremlin must act urgently, otherwise it could trigger a serious wave of instability that could shake the entire country. The Russian financial landscape could become a confusing battlefield - a hopeless situation that could have catastrophic consequences for everyone involved!