Overview of the Russian Gas Exports in 2024 and Outlook for 2025

Will the increase in Russian gas exports to China in 2025 leads to lower US LNG exports to China? That will be a very interesting development.

It has been nearly three years since the Russia's invasion of Ukraine. The impact of the invasion on global gas markets was unprecedented as analysts struggled to comprehend the changes and the consequences. The invasion has not only appended world trade in gas, but also changed how gas is transported form pipelines to LNG carriers. It also changed the geopolitics of natural gas as Russia lost influence in Europe to the US. The invasion of Ukraine and the rise in energy cost in Europe wreaked havoc on European economies, especially Germany.

The invasion of Ukraine has also appended climate change policies in Europe: Some European countries returned to coal or delayed coal phaseout. Several countries provided subsidies for “fossil fuel” after years of calling on other nations to stop subsidizing fossil fuel.

In 2023, Russia's gas giant Gazprom suffered its first annual loss in over two decades, primarily due to a significant drop in gas shipments to the European market, its primary export destination. However, the year 2024 marked a new turning point for Russia as its gas sales began to show signs of growth. This growth was driven by increasing demand for Russian gas and LNG, leading to several key developments:

• Unprecedented growth in Gazprom's gas shipments to China through the Power of Siberia 1 Pipeline.

• Unexpected growth in Gazprom's gas shipments to the EU via pipelines passing through Ukraine and Turkey.

• Growth in its LNG shipments to many European countries. LNG sales to Europe reached record high in 2024.

Below is a review of major developments in 2024 and outlook for 2025 with discussion with potential impact on the European and global gas & LNG markets.

Gazprom Deliveries to China At Record High