Russia increased domestic gas prices by 11.2% starting from July 1, 2024. This increase aims to boost revenues within Russia's domestic market in response to the loss of gas exports to Europe.
According to the Ministry of Defence of Great Britain on X (Twitter), the summary indicates that the loss of the EU market is a consequence of sanctions against Russia for its invasion of Ukraine, as well as deliberate reductions in gas supplies to Europe by Russia in response. In 2023, Gazprom incurred a net annual loss of approximately $6.9 billion, marking its largest annual loss in 25 years.
Gazprom, one of Russia's state energy companies, is considered a monopoly in the domestic gas supply market. Therefore, price increases are regulated by the Russian government, as stated in the report.
According to British intelligence, inflation in Russia is likely to remain above the Central Bank of Russia's target of 4% in the second half of 2024. This is partly due to rising domestic gas prices alongside increases in other household bills and increased government spending, primarily driven by higher military expenditures due to the war in Ukraine.
