Gazprom has signed an agreement to explore the potential of supplying Russian gas to Iran, according to reports..
Gazprom and the National Iranian Gas Company (NIGC) signed the memorandum of understanding during a visit of Gazprom executives to Tehran. “The parties proceed from developing long-term mutually beneficial cooperation going forward,” a Russian news agency quoted Gazprom as saying in a statement.
During the visit, the company’s CEO Alexey Miller met with Iranian Oil Minister Javad Owji for a working meeting, discussing priority steps to implement the memorandum and other areas of collaboration in the energy sector, Gazprom stated.
This marks the second visit of Gazprom’s top managers to Iran this year. Earlier, in May, Miller visited Iran for discussions with high-level Iranian officials, including the oil minister.
The top executive visited Iran while Russian President Vladimir Putin was in China for high-level talks. Miller’s absence from the Chinese visit was interpreted as another sign that Russia is not close to finalising a deal with China for a second pipeline to supply Russian gas, the Power of Siberia 2.
In the face of losing most of its European market, Gazprom is pivoting its sales to Russia’s “friendly” countries, including China and Iran. Before the war, Russia supplied around one-third of Europe’s gas.
Last year, the company’s pipeline gas exports to Europe slumped by 55.6% compared to 2022. Consequently, it also recorded its first annual net loss in 23 years, signalling a significant shift in financial performance due to dwindling gas shipments to Europe and pricing pressures.
Earlier this month reports emerged that Gazprom is unlikely to recover the gas sales it has lost. Research has predicted that the company’s exports to Europe will average only 50 billion to 75 billion cubic meters a year by 2035, barely a third of pre-war levels.
While the company is banking on a new pipeline to China to compensate for the lost European export volumes, this pipeline’s capacity will be just 50 billion cubic meters a year. Additionally, prices in the Asian market are significantly lower than in Europe, and a construction deal for the pipeline has yet to be finalised, the report stated.
Deputy Editor at Oil & Gas Middle East. Journalist with experience in the energy industry, politics, environmental issues and world news. Pooja is passionate about bringing news of all that matters… More by Pooja Kapoor