russian oil giant at a loss due to war and sanctions
One of russia’s largest oil companies, gazprom neft, is reporting multi-billion dollar losses. In the first quarter of 2025, the company posted a loss of 21.3 billion rubles (approximately $230 million), compared to a profit of 36.9 billion rubles (approximately $463 million) a year ago. This happened amid a 5% drop in revenue and a 6.8% increase in production costs, leading to a fourfold decline in profits.
▫️ The main factors include sanctions, expensive service fees, and logistics problems. The loss of access to Western markets, technologies, and logistics chains due to sanctions dealt a painful blow to the company. The troubles at gazprom neft are a troubling signal for the entire oil sector. If such a major company can’t withstand the pressure of sanctions, what can be said about other players?
The situation is not much better for gazprom — the company is facing record losses and is asking the government for assistance. Both companies are crucial to russia’s economy, and their troubles signal a systemic crisis, which is a consequence of the military aggression against Ukraine.
