Gas production in the first quarter of this year started to grow compared to the same period of 2023 and made 196.9 billion cubic meters. It is expected as demand from consumers in domestic market increased, as well as volumes of deliveries to foreign countries, including the European Union started increasing.

In 2023 production in Russia made 636.7 billion cubic meters that was less even modest indicators of 2022 (673.8 billion cubic meters). But such a decrease was expected — export was reduced.

In 2022 a traditional direction of deliveries through Nord Stream and the Polish site of the gas pipeline Yamal — Europe became inaccessible. Also Kiev refuses to accept demands of Gazprom for pumping through gas-measuring station (GMS) Sokhranovka, keeping only the corridor passing through GMS Sudzha.

But the most important was reduced consumption of gas in Europe, besides decrease was observed at the end of 2021. It was connected with a record increase in prices at the European exchanges which began in the summer of 2021, and in December of the same year of the quotation reached heights unknown at that time — $2 thousand for 1 thousand CBM. High prices pressed on demand first of all in a segment of households and the industry. So, decline in demand in an industrial segment for the first two months 2022 in relation to the similar period of 2021 made about 20%.

Decline in demand from end users led to decrease in demands from wholesale buyers of the Russian gas in EC. For the first two weeks 2022 Gazprom reported on reduction of export to foreign countries for 41.1% (on 3.7 billion cubic meters, to 5.4 billion cubic meters), and following the results of the first one and a half months — for 35.5% (on 9.8 billion, to 17.9 billion).

There were no signs of demand recovery from European companies and supply growth.

In other words, the reduction was not due to sanctions policy or any «gas saving» programs, but to a catastrophic crisis in the energy sector that has been hitting Europe since the summer of 2021. Success of its blows was connected with domination of an exchange binding in the market.
This binding extended and on long-term contracts of Gazprom with the European companies.

Those buyers, which contracts mainly were based on an oil binding, endured an energy crisis much easier. Among buyers of the Russian gas in foreign countries natural gas with oil binding buys China. In general, the Asia-Pacific region is characterized by a commitment to this type of contract pricing with the vast majority of suppliers.

During the separate periods since summer 2021 difference of the price of «exchange» and «oil» gas was tenfold.

Moreover, our country’s total production in 2022 and 2023 could have been even lower if it were not for the commissioning of new production facilities by independent players (primarily Rosneft).

Falling of production which was observed in 2022-2023 was not the unique phenomenon. So, in 2008 production of natural gas in our country made 665 billion cubic meters and in 2009 — 584 billion. Reduction was also connected with crisis which led to demand reduction and that is to falling of export deliveries. After 2009, there was a period of low demand in the European Union, at which time there were predictions that exports (and with them production from Russia) would never be the same again but after some fluctuations in 2015 production in Russia made about 635 billion cubic meters then started growing.

Of course, it is not necessary to hope for fast restoration of deliveries to Europe, as well as on fast normalization of the relations with this region. But we have a growing domestic demand (the level of gasification is increasing — from 40% in 1990 to 63.2% in 2010 and about 73.8% in 2023). And supplies to the eastern direction are also growing.

According to Gazprom, during a heating season of 2023-2024 the company provided record supply of natural gas to the Russian market. In the first quarter January appeared the frostiest, temperatures fell below climatic norm. Then two historical records of daily deliveries were set. The first fell on January 12 – 1788.3 million cubic meters. But it did not last even a day — on 13 January it was pumped 1814.7 million cubic meters.

Gazprom’s production of blue fuel in the first quarter of 2024 increased by 13% to 132 billion cubic meters, while Rosneft’s production increased by 1.5% to 20 billion cubic meters. The increased demand for the Russian gas was observed from China and Uzbekistan. The records of daily deliveries on Force of Siberia to the People’s Republic of China during a heating season were updated 11 times.

In general deliveries on Force of Siberia according to the plan increase since 2019 when the gas pipeline was put into operation, in process of input of new mining and refinery capacities in the territory of Russia, and also the accepting infrastructure in the territory of China.

However, it was not just the eastern direction that saw growth in the first quarter relative to the same period in 2023. European companies also needed more Russian gas.