Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to Forbes about the impact of rising domestic gas prices in Russia on the economic situation of Gazprom.
The main reason for the increase in wholesale prices is Gazprom's need to at least partially make up for lost export revenues by increasing the profitability of the domestic market, Alexei Belogoryev notes. But we should not forget about the significant cost inflation, he adds.
The increase in tariffs will increase Gazprom's revenue by 160-200 billion rubles, Belogoryev believes, that is, less than 2% of total revenue and less than 5% of net revenue from gas sales. According to the expert, although these funds are not enough to close the investment program, the company still has income from gas supplies for export, and even with lower export volumes and a stronger ruble, Gazprom will be able to implement the investment program with minimal additional debt."If we take a broad horizon of 2014-2028, the current outpacing growth rates of domestic gas prices will only equalize them with the dynamics of the consumer price index for this period," Belogoryev notes. "That is, from the government's point of view, gas prices are only being adjusted to long-term inflation."
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