Russian gas market
Summary
Russian natural gas market is the second largest in the world (after the USA). In 2024, production amounted to 685 bcm, domestic gas consumption - 522 bcm. 76% of the produced gas is consumed in Russia.
Pipeline exports in 2024 amounted to 119 bcm, which is equivalent to 17% of production. Russia's once-gigantic pipeline gas exports to Europe are stagnating due to the US blowing up of Nord Streams in 2022, Poland's suspension of transit and consumption through Yamal gas pipeline, Pribaltica states' refusal of Russian gas import, and Ukraine's blowing up of Sudga gas pumping station in 2025. Supplies to China via the Power of Siberia, to Türkiye via the Blue Stream, and residual supplies to Eastern Europe via Türkiye via the Turkish Stream form the basis of modern pipeline gas exports from Russia. Pipeline export in 2025 decreased to 115 bcm. Plan for 2026 is 118 bcm.
Russia has 5 LNG projects: Sakhalin-2, Yamal LNG, Artic LNG 2, Gazprom LNG Portovaya and idle Cryogaz-Vysotsk. As of October 2024, there are also 22 low-tonnage LNG plants operating in Russia, performing the function of regional gas distribution. Preparatory and construction work has begun on two plants: in Ust-Luga and Murmansk region.
Russia is the fourth largest exporter of LNG to the global market. In 2024, LNG exports increased by 4% compared to 2023 and amounted to 47.2 billion cubic meters 30.5 million tons of LNG), which is equivalent to 7% of production. Some of the cargoes produced from Arctic LNG-2 and Gazprom LNG Portovaya are afloat and cannot find a buyer.
After USA and Co’s blowing the Nord Streams, political stoppage of Yamal pipeline by Poland LNG and Ukraine attack to Sudzha gas station, LNG is the key for sustainable Russian gas export. LNG exports has becoming viable for the entire Russian economy, both the fuel and energy complex and the engineering and shipbuilding industries.
Existing political pressure from United States, EU and other countries has not yet led to a decrease in total LNG production and exports, but it is already having negative consequences: temporary shutdown of Train 1 of Arctic LNG-2 immediately after its launch in Q3 2024 and depressed production volumes after its restart in Q3 2025, temporary shutdown of Gazprom LNG Portovaya and shutdown of Cryogaz-Vysotsk, downtime of gas carriers and floaters. This pressure also affected construction of trains 2 and 3 of Arctic LNG-2 , the new LNG plant in Ust-Luga and the pause in the construction of the plant in Murmansk.
EU countries (France, Spain, Belgium, the Netherlands) and East Asia (China, Japan, South Korea) dominate the current export portfolio of Russian LNG, reflecting the overall consumer structure in the global LNG market.
Key company of Russian LNG industry is Novatek. Future growth of Novatek now depends on the firm’s capability to establish full scale domestic production for LNG equipment, including liquefaction components and ice-class LNG carriers.
Russia is top 3 in the world by installed capacity of gas-fired TPPs.
Map of gas industry
Natural gas reserves
Growth of natural gas reserves of industrial categories (AB1C1) in 2024 amounted to 723 bcm. Production amounted to 685 billion cubic meters. Thus, net reserves increased due to a reduced production level.
Growth of natural gas reserves of industrial categories (AB1C1) in 2025 amounted to 635 billion cubic meters. In 2025, large deposits were discovered - Mezeninskoye gas field with reserves of 49.7 billion cubic meters and Ust-Biryukskoye gas condensate field with reserves of 14.3 billion cubic meters.
Russia's gas reserves at the current production level are guaranteed for more than 100 years.
Natural gas production
Production volumes
Production volumes:
2023 - 637 bcm.
2024 - 685 bcm (+7.6% by 2023).
2025 - 663 bcm
According to the Energy Strategy of the Russian Federation until 2050, published in April 2025, the following indicators of gas production volumes are established:
2030 - 853 bcm.
2036 - 965 bcm.
2050 - 1107 bcm.
Increase in gas production over next 10 years (by 2036) is based on development of Tambey group of fields on Yamal Peninsula.
Increase in gas production by 2050 implies a multiple increase in production from gas hard-to-recover reserves, both to compensate for natural decline in gas production with use of traditional methods and to overall increase national gas production.
Production centers
Nadym-Pur-Taz region has been Russia's leading gas production center for over 50 years. In 2025, 367 billion cubic meters of gas were produced (55% of total gas production in 2025). Production in the region is stagnating due to depletion of reserves. Current depletion rate is 56%. Peak production was 480 bcm in 2018 and 467 bcm in 2021. Average decrease in production since 2021 is 6% per year. This decrease is due to both overall decrease in gas production in Russia due to a drop in exports to EU, as well as the depletion of deposits.
Yamal-Gydan region is the second-largest producer. In 2025, 131 billion cubic meters of gas were produced (20% of the total gas production in 2025). This is a repeat of the record-breaking figure from last year. Production continues to increase. Potential production is estimated at 300 bcm per year by the second half of 2030s. Increase is bases onon development of Tambey group of fields.
Production in other gas-producing regions (Eastern Siberia, Arctic shelf, Sakhalin, and European part of Russia) amounted to 165 billion cubic meters in 2025.
Gas production is actively developed in the eastern part of Russia. Two new fields, Tas–Yuryakhskoye and Verkhnevilyuchanskoye, are being developed in Gazprom's Yakutsk gas production center, the base for which is Chayandinskoye field. There is also active drilling of wells and construction of gas treatment and transportation facilities for the Chonsky oil and gas cluster of Gazprom Neft.
Technological challenges of gas production in Russia
Problems of increasing reserves in the Nadym-Pur-Taz region:
Decrease in the filtration and capacity properties of the basic rocks
Decrease in the density of reserves
Water-gas-bearing zones, including macro-trapping of gas in peripheral zones
Abnormally low reservoir pressure
Complexification and increase in the cost of well structures
Problems of developing the Achimov and Jurassic reservoirs:
Low-permeability gas condensate reservoirs
Up to 80% of condensate and 45% of gas remain in the reservoir
Increasing the efficiency of condensate extraction:
Sealing drilling
Injecting a hydrocarbon mixture back into reservoir
Taxes
Natural gas production is subject to Mineral Extraction Tax (MET).
LNG Plants
Russia has 5 build LNG plants:
Yamal LNG of Novatek (port of shipment - Sabetta).
Sakhalin-2 (port of shipment - Prigorodnoye).
Arctic LNG 2 with 1 or 2 trains ready. After start up in 2024 it is idle.
Medium-tonnage plant “Gazprom LNG Portovaya” (port of shipment - Portovaya). As of June 2025 it is idle.
Medium-tonnage plant “Cryogaz-Vysotsk” (port of shipment - Vysotsk). As of June 2025 it is idle.
FID stage has passed two more plants: in Ust-Luga and the Murmansk region.
Сonstruction of Ust-Luga LNG plant continues. As of 25.12.2025 construction progress is 70%. To date, this plant does not have a single known contract for the supply of LNG.
In 2025, commissioning of Murmansk LNG plant was officially moved from 2030 to 2032.
As of October 2024, there are also 22 low-tonnage LNG plants operating in Russia, performing the function of regional gas distribution. It is planned to build 85 more such plants by 2035.
The creation of an LNG infrastructure is actively continuing in Russia. The government has announced a goal to occupy 15-20% of the global LNG market by 2035. The locomotive of this program is Novatek.
There is one abroad project. LUKOIL hold 25% share of two floating LNG plants in Republic of Congo with 3 MTPA aggregated capacity. US attack on Russian oil ang gas company Lukoil creates some issues for Lukoil to participate further in this project.
LNG Loadings
In 2023, LNG exports amounted 45 bcm, which is 30.5 million tons of LNG.
In 2024, LNG exports increased by 4% compared to 2023 and amounted to 47.2 bcm, which is 34.2 million tons of LNG.
According to the Energy Strategy of the Russian Federation until 2050, the following indicators of LNG export volumes are established:
2030 - 142 bcm, which is 103 million tons of LNG.
2036 - 179 bcm, which is 130 million tons of LNG.
2050 - 241 bcm, which is 175 million tons of LNG.
LNG production in Russia is stable and withstands moderate pressure from the United States and the EU. However, all new development projects have been put on pause due to the much more critical level of pressure on them from these countries. From a resource, technological and production point of view, Russia (and above all Novatek) is ready to export such volumes of LNG in the long term. At the moment, everything depends on the political willingness of foreign buyers to import Russian LNG.
Artic LNG 2
The first train of Arctic LNG 2 was launched in the summer of 2024. Cargoes loaded in August - October 2024 traveled half the world and could not find a buyer for a year due to the harsh US pressure on China.
Arctic LNG 2 resumed commercial LNG loadings in June 2025. Chinese regas terminal Guangxi Beihai of Taishan port has recieved both new loading and Summer 2024 cargoes. Deliveries began on the eve of the September meetings of the Chinese and Russian leadership, which indicates a system solution. Apparently, the Guangxi Beihai regasification terminal was sold to the National Oil and Gas Pipeline Company structures of Novatek or a Russian trader. These LNG shipments have become an important precedent for the global LNG market - for the first time, supplies were made from a plant included in the lists of Western countries. The Koryak floating storage facility, which is also on these lists, was involved in the deliveries. As of June 2026 regas terminal Guangxi Beihai received 41 cargoes from Arctic LNG 2 and 3 cargoes from Gazrpom LNG Portovaya.
In September 2025, it was spotted the loading of a LNG cargo at the second train of Arctic LNG 2.
PipeChina Longkou LNG terminal is going to be commissioned during Summer 2026. It is expected to become the second entry point for Artic LNG 2 into Chinese gas market starting in Q3 2026. The first phase of the terminal will have a capacity of 5 MTPA. This indicates strengthening of Russian-Chinese energy ties, even in the face of Western pressure.
Cabotage and regasification
LNG cabotage is carried out in Russia in relatively significant volumes. It is mainly aimed at reducing usage of ice-class LNG carriers in waters that do not require this class. Currently, the main route for such transshipment is cargoes from Sabetta in Yamal with its transshipment at the Murmansk shores to LNG carriers without an ice class.
In addition giant floating storages Saam and Koryak has finally being used for intermediate commercial transhipemnt in Q3 2025. It was idle for two years due to political pressure from the United States, the EU and the UK on the countries that buy Russian LNG.
Before going idle, LNG was also coasted from medium-tonnage projects on the Baltic to Kaliningrad. Some of these volumes were not gasified, and some were transshipped and exported.
A regasification terminal in Kamchatka will start operating from 2026/27 heating season. Supplies to the terminal will come from Arctic LNG-2. A geographical swap has been concluded between Gazprom (Sakhalin-2) and Novatek. Novatek will receive an equivalent volume of LNG produced at Sakhalin-2 and will export it.
Export destinations
The table “Monthly LNG loadings volumes at Russian ports and destination countries" provides statistics on importing countries of Russian LNG with aggregation dates by calendar months. The date of gas carrier loading is used, the data on importing country is available upon discharge. The data has been provided since 01.09.2022 and is updated automatically. Data for the current month is shown as a cumulative total.
EU countries (France, Spain, Belgium, the Netherlands) and East Asia (China, Japan, South Korea) dominate the current export portfolio of Russian LNG. The supply structure changes every month and depends on the current imbalances of the national gas balances.
Most of the export portfolio is exposed to the risk of sanctions from importing countries, which is potentially an extremely strong risk for Novatek and especially Gazprom. However, the continuing projected shortage of LNG until 2025 creates moderate optimism that sanctions will not be imposed until then.
Historically, Novatek has used Belgium (the Zeebrugge terminal) and France (the Montoire de Bretagne terminal), as well as, to a lesser extent, the Netherlands (the Gateway LNG terminal) for intermediate cargo transshipment from Yamal LNG and its subsequent re-export. The volume of transshipment was about 3.2 - 3.9 million tons per year (on average, 16% of Russian exports). The vast majority of the re-exported volumes from these terminals went to China or were further resold by Chinese commodity traders. On March 26, 2025, the EU ban on transshipment of Russian LNG in EU ports and its further export began to take effect. This EU self-ban does not yet restrict the export of LNG directly to the EU, followed by its regasification at the terminal.
China
China is becoming the leading consumer of Russian LNG.
As of December 2025, it is the only country accepting LNG from the blacklisted Arctic LNG-2 and Gazprom LNG Portovaya plants.
India
In October 2025, it became known that Gazprom was negotiating the construction of a regasification terminal in India. The construction of the terminal is being considered at Kakinada port on the east coast of India. The terminal's capacity is 5 million tons of LNG per year. The volume of investments is 50 billion rubles. This terminal can become both the anchor recipient of LNG from the new LNG plant in Ust-Luga, and the recipient of LNG from Sakhalin-2 in case Japan abandons it.
Sri Lanka
In December 2025, it became known about intergovernmental negotiations between Russia and Sri Lanka on construction of a regasification terminal in Sri Lanka.
Bangladesh
In 2025, Novatek entered into negotiations on construction of a land-based regasification terminal in Bangladesh. Design capacity is 7.5 MTPA.
Philippines
There are discussions about building a regasification terminal for long-term supplies of Russian LNG.
Taxes
LNG exports are not subject to duties.
Export of pipeline gas
Pipeline gas exports by year:
2023 - 101 bcm.
2024 - 119. Increase by 15.6%.
2025 - 115. A decrease compared to the previous year. This is expected to be the bottom for the value of Russian pipeline gas exports.
Plan for 2026 is 118.
According to the Energy Strategy of the Russian Federation until 2050, the following indicators of pipeline gas exports are established:
2030 - 151 billion cubic meters.
2036 - 197.
2050 - 197.
EU
Russia was the key supplier of gas to EU until 2022. Pipeline supplies reached 400-450 mcm per day. After the blowing up of Nord Streams by US and Ukraine and Poland's blocking of supplies via the Yamal-Europe gas pipeline, supply volumes decreased fivefold to 80 mcm per day.
As expected, Ukraine and the United States have stopped the transit of Russian gas through Ukraine to the EU from January 1, 2025. Since 2025, Russian exports and the EU market have lost pipeline gas in the amount of 41 mcm per day (15 bcm per year).
For Russophobic reasons, European Commission requires all EU countries, as well as states planning to join EU, to begin terminating gas supply agreements with Gazprom Export. In Q2 2025 the European Commission presented the following action plan:
Self-restriction of EU countries on conclusion of new supply agreements for pipeline gas and LNG starting from 01.01.2026.
“Termination” of short-term agreements by 17.06.2026.
“Termination“ of long-term agreements tby 01.01.2028 for all EU countries except Slovakia and Hungary.
Since January 2025, Turkish Stream has been the only Russian gas supply channel to EU. In H1 2025, Russian supplies to EU via this route (including re-export of gas outside the EU) amounted to 43 mcm per day, which is 10% of 2021 import volumes. Of these, 21 mcm per day goes to Hungary, 7 - to Slovakia, 15 - to Serbia (including re-exports to non-EU Balkan countries), and 1 - to Greece. Some of physical molecules of Russian gas are likely to enter Ukraine from Hungary and Slovakia as part of Ukraine's commercial imports of European gas.
According to the terms of the agreements, European companies must pay fines for non-taking of gas (take-or-pay clause). European Commission does not want to pay fines and is looking for ways to sign some kind of paper, according to which unilateral termination of international agreements without penalties will be considered “legitimate” in EU. Pocket Stockholm Arbitration Court is likely to be involved in this process. There is already the precedent for “legitimizing” termination of similar contract between Ukraine and Russia without paying contract amount of penalties by Ukraine. This process will finally disconnect EU gas market from supplies from Russia, which will bring additional losses to EU companies and residents and lead to continued stagnation of energy-intensive industries in EU. Even more damage will be carried on by Gazprom. It was gas sales to EU that ensured low level of domestic gas tariffs, as well as Gazprom's generous social program.
Transit to Kaliningrad region via Lithuania
10 years agreement on transit of Russian gas through Lithuania to Kaliningrad Region expired in 2025. The contract volume for transit was 2.5 bcma. The contract included “transport or pay" clause. Actual transit volume in 2025 was at the contract level. Price of the transit under expired contract was 13 million euros / 1.2 billion rubles. Unit cost of transit was 0.02 AED / 0.04 CNY / 0.46 INR / 0.48 RUR / 0.61 US cents per cubic meter of natural gas.
At the end of 2025 the contract was renewed for 5 years. Transit price increased 2.2 times to 29 million euros / 2.7 billion rubles. Unit cost of transit will increase to 0.05 AED / 0.10 CNY / 1.02 INR / 1.07 RUR / 1.35 US.
Greece
As of 2025, there is a gas supply agreement between Gazprom export and state-owned DEPA (ΔΕΠΑ).
The current agreement with DEPA was signed in January 2022 and is valid until the end of 2026. Previously, there were other agreements between the same parties. The annual volume of supplies under the current agreement is 2 bcm (5 mcm per day). The agreement contains a ”take or pay" condition. The formula price has a basic reference to the TTF index (80% of the price) and oil quotations (20%). In March 2024, DEPA filed to the Stockholm Arbitration Court a standard retrospective price review with Gazprom Export. In July 2025, the parties reached a pre-trial settlement.
Due to the planned general self-restriction of EU in the supply of Russian gas, it is unlikely that this agreement will be renewed.
Serbia
Serbia receives Russian gas through Turkish Stream with transit through EU territory (Bulgaria). Serbia further re-exports part of the gas to Balkan countries that are not members of EU.
In June 2026, Serbia once again extended the contract for 3 months until 30.09.2026. It is on this day that EU restriction on the import of Russian pipeline gas comes into effect.
In the long term, it is unlikely that Serbia will be able to defend its right to import Russian energy resources.
Belarus
Russian gas supplies by year:
1995 - 12.5 bcm. Minimum value for all time.
2010 - 21.6. Maximum value for all time.
2022 - 18.7.
2023 - 17. A decrease due to the launch of the second power unit of the Belarussian NPP in May 2023.
2024 - 17.
Russian gas is the main fuel of the Belarusian TPPs, which are the basis of the Belarussian energy system.
Türkiye
Russia supplies pipeline gas to Türkiye through two main gas pipelines, Blue Stream (16 MTPA) and Turkish Stream (31.5 MTPA).
Part of the gas (41 mcm per day, 15 bcm per year) recieved through Turkish Stream is further supplied to EU, while Russia retains ownership of this gas. Turkish route is the only surviving way to supply Russian gas to Europe. Deliveries of Russian gas through this line in 2025 amounted to 18.1 bcm.
These gas supplies are subject to military attacks from Ukraine and Western European countries.
In 2025, overall supply amounted to 21.2 bcm (58 mcm per day), which is equivalent for 37% of Türkiye' s total imports of pipeline gas and LNG.
In June 2026, Gazprom and Turkish Botas began discussions on renewal of gas supply agreements for Blue Stream and Turkish Stream routes. Current contracts are short-term and were signed last December for a period of one year. Consequently, it will expire on 31.12.2026.
Georgia
Russian gas supplies to Georgia by year:
2016 - 160 million cubic meters
2017 - 135
2018 - 40
2019 - 162
2020 - 204
2021 - 307
2022 - 520
2023 - 596 (maximum for all years)
2024 - 420
2025 - 560
In Georgia, Russian gas competes with Azerbaijani gas.
As part of the Russian gas supplies to Georgia, a certain discount is provided to ensure the transit of Russian gas to Armenia through the territory of Georgia.
Armenia
Russian gas supplies to Armenia by year:
2016 - 1,800 million cubic meters
2017 - 2,000
2018 - 1,900
2019 - 2,200
2020 - 2200
2021 - 2500
2022 - 2600
2023 - 2300
2024 - 2288
2025 - 2229
According to 2018 agreement, base wholesale price of Russian gas for Armenia is $165 per thousand cubic meters. Additionally, Russia provides a discount on Russian gas supplies to Georgia to ensure the supply of Russian gas to Armenia.
Gazprom Armenia, a subsidiary of Gazprom, is recipient and distributor of gas in Armenia. However, profitability of this company is regulated by Armenian authorities with detailed oversight by USA (through USAID). Profits are limited to 8-9%, the rest is taken away through reduced regulated tariffs and mandatory capital investments.
In Armenia, Russian gas competes with Iranian gas.
Azerbaijan
Azerbaijan may be a potential market for Russian pipeline gas. Supplies can begin if a gas swap is established - Azerbaijani gas will flow to the EU in greater volume, and Russian gas will take its place in the domestic market.
The potential volume of supplies is 3-4 billion cubic meters per year (8-11 million cubic meters per day).
Iran
In January 2025, Russia and Iran agreed on the route of the gas pipeline to the republic through Azerbaijan, negotiations are in the final stage of agreeing on the price of supplies.
Kazakhstan
In 2024, Russian gas supplies to Kazakhstan amounted to 3.8 bcm (10 mcm per day).
In October 2025, Gazprom and Kazakhstan signed a memorandum on the construction of a new main gas pipeline from Russia to Kazakhstan with initial capacity 10 bcma.
Russian gas supplies to Kazakhstan are expected to reach 10-12 bcm (27-33 mcm per day) in 2030. Proposed route: Ishim (Tyumen region) - Petropavlovsk - Kokshetau - Astana.
Uzbekistan
As of 2025, a contract is in effect between Gazprom and Uzbekistan for the supply of 7.7 bcma (21 mcm per day) in transit through Kazakhstan. In 2024, the actual volume of supplies amounted to 5.64 bcm (15 mcm per day). Plan for 2026 is to increase volume of supplies to 11 bcma (30 mcm per day). Estimate for 2030 is 12 bcm (33 mcm per day).
Leitmotif for the supply of Russian gas to gas-rich Uzbekistan, is growing domestic gas consumption coupled with the need to execute with export contracts with China.
Kyrgyzstan
Gas supplies to Kyrgyzstan in 2024 amounted to 0.5 bcm.
China
Power of Siberia is the main export route of Russian pipeline gas to Asia.
Supply by year:
2023 - 30.0 bcm.
2024 - 31.1 bcm.
2023 - 38.8 bcm. Exceed of the contract volume by 800 mcm.
In September 2025, agreement was reached to increase the supply through Power of Siberia-1 from 38 to 44 bcm per year.
Price formula in the contract is linked to crude oil price indexes and averaged over 9 months. This type of formula price was typical for long-term contracts for pipeline gas and LNG at time of contract signing, but the multiplier coefficient to oil index (“slope”) is lower than the industry standard of 12.5%. This indicates that Russia provided to China a discount.
Since 2015, Russia and China have been negotiating construction of Power of Siberia 2 gas pipeline, which will have capacity of 50 billion cubic meters per year. The pipeline is intended to connect the existing gas fields of Bovanenkovo and Kharasavey in Yamal with China through Mongolia. For Russia, this pipeline is an option for the gasification of Eastern Siberia and, since 2019, an alternative source of supply for Yamal gas after the gradual closure of the EU market. However, the parties have not reached an agreement on the commercial terms of the supply, including the price formula and guaranteed volume.
Discussions on the technical design of the gas pipeline began in 2020 and have not progressed significantly. In 2025, Russia and China entered into preliminary agreements for the supply of pipeline gas through the Power of Siberia-2 gas pipeline. In the fourth quarter of 2025, the organization of technical design for Power of Siberia-2 began. The pipeline was included in China's 15th Five-Year Plan for 2026-2030, but without any binding provisions.
The summit of Vladimir Putin and Xi Jinping on 19-20.05.2026 did not lead to the signing of a solid contract and the promotion of the implementation of this project.
As of May 2026, positions of the parties on the contract are estimated to be as follows:
Gazprom: a long-term contract for 25-30 years with a guaranteed volume for the entire supplied volume (take-or-pay condition) with a minimum price threshold, as well as China's participation in financing capital expenditures for construction of Russian section of the gas pipeline. An important aspect is expected price level based on a pricing formula, which is considered comfortable at a level starting from $250-300 per thousand cubic meters of gas at the border.
China National Petroleum Corporation: avoidance of guarantees for purchasing the entire volume of gas and an estimated price level under the contract at a lower level ($250 per thousand cubic meters of gas at the border and below.
Far Eastern Route gas pipeline project is under construction. This export gas pipeline is an extension of existing Sakhalin-Khabarovsk-Vladivostok gas pipeline. Export section of overall system will have capacity of 12 billion cubic meters per year. The pipeline is expected to be launched in early 2027.
Taxes
Exports of natural gas pipelines are subject to a duty.
In 2024, the total receipts to the federal budget of payments for export duties and mineral extraction tax on gas amounted to 1.9 trillion rubles (5.2% of the federal budget revenues of the Russian Federation). After the EU's rejection of Russian gas, the gas revenues of the federal budget of the Russian Federation have dropped significantly.
In 2025, Gazprom continued to experience financial difficulties, but the situation has stabilized. Since the beginning of 2025, the additional mineral extraction tax in the amount of 600 billion rubles per year has been abolished ahead of schedule.
Russian LNG shipment
The largest shipping companies of Russian LNG:
Greek shipping company Dynagas, controlled by George Procopiou,
Yamal LNG (owner of Yamal LNG plant), controlled by Novatek and three other companies,
China LNG Shipping International Company,
Russian state shipping company Sovcomflot.
As of January 2026, Russian companies and companies involved in the export of Russian LNG control 24 Arc7 and Arc4 ice class gas carriers. In general, Arc4 is sufficient for summer navigation in the Arctic, and Arc7 is necessary for winter navigation.
In 2025-2026, Russia is experiencing a shortage of ice-class gas carriers needed to export LNG from Arctic projects. Temporary shoutdown of the first train of Arctic LNG 2 in 2024-2025, as well as expected low utilization of its two trains in the coming years, are also related to unavailability of specialized LNG gas carriers of the Arc7 and Arc4 ice classes. These LNG carriers are created exclusively for Russian Arctic projects of Novatek. These LNG carriers are unique and, in fact, their use for other projects will be economically more expensive than conventional LNG carriers.
Pressure from Western countries and inclusion of ice-class LNG carriers and Arctic LNG 2 plant into black lists are aimed at reducing physical possibilities of exporting LNG from Artic and replacing it in the international LNG markets by US LNG.
In 2025, Novatek began to switch to originally planned scheme for exporting LNG from Arctic LNG 2 with use of ice-class gas carriers only on the Northern Sea Route, transshipment of LNG via giant FSUs Saam and Koryak at the end points of NSR and use of non-ice-class LNG carriers for further export of LNG from these floating storages to ports of final buyers.
In December 2025 - January 2026, only one such LNG carrier operated on NSR, Christophe de Margerie (9737187), in shuttle mode between Utrenny terminal (Arctic LNG 2) and Saam FSU (9915090) in Murmansk oblast. In January 2026, a new Russian Arc7 ice-classs LNG carrier Alexey Kosygin (9904546) will join the route, which will double the ability to export and, consequently, produce LNG to Arctic LNG 2.
As of 23.12.2025, 17 LNG carriers are included in Western black lists (excluding giant floaters). Since October 2025, share of LNG shipments made on blacklisted LNG carriers has been growing. In November 2025, LNG shipments on blacklisted LNG carriers amounted to 1 million tons, which is equivalent to 25% of total volume of LNG loadings in Russia, including cabotage operations.
As a measure to increase the fleet of non-ice-class LNG carriers, purchases of LNG carriers continue on secondary market. In January, 4 LNG carriers (including Mercuriy - 9326689, Kosmos - 9300817, and Luch - 9317315) were purchased from Omani company Asiad Shipping, and since the beginning of April, they have been flying Russian flag. These vessels will likely load LNG from Saam and Koryak floating storages and deliver it to final buyers in China and other countries.
Ukrainian attacks on Russian gas infrastructure
Russia's LNG infrastructure has been under active attack from Ukraine and NATO countries since the beginning of 2024.
List of attacks:
26.09.2022 - sabotage was committed on Nord Stream and Nord Stream-2 gas pipelines. As a result of a series of explosions at a depth of 80 meters in the international waters of the Baltic Sea, in the exclusive economic zones of Denmark and Sweden, both lines of the Nord Stream and one of the two lines of the Nord Stream-2 were destroyed. There were a total of 800 million m3 of gas in three pipeline lines at the time of the accident. At the time of the accident, gas transportation was not carried out on them: the Nord Stream was stopped by the Russian side, the Nord Stream-2 was not launched, but both of them were ready for operation.
07.08.2024 - Ukrainian troops have gained a foothold in the town of Sudzha in Kursk region, including control of Sudzha gas measuring station. On 21.03.2025, Ukraine blew up Sudzha gas measuring station, which was occupied at that time. On 28.03.2025, after the station was liberated from the occupiers, Ukraine, with assistance of USA, UK and France, finished off this station and related infrastructure with a missile strike.
11.01.2025 - In order to stop gas supplies to Europe, an attempt was made to attack the infrastructure of the Russian station in Gay Kodzor, Krasnodar Territory, which supplies gas through the Turkish Stream pipeline. All the drones were shot down.
21.03.2025 - Ukraine blew up the Sudzha gas measuring station, which was occupied at that time
28.03.2025 - Ukraine, with the assistance of the United States, Great Britain and France, finished off this station with a missile strike.
09.04.2025 - attack of Ukrainian drone on Korenovskaya compressor station of Turkish Stream.
19.10.2025 - Ukrainian UAVs attacked Orenburg gas processing plant. The plant suspended operations and acceptance of Russian and Kazakhstani raw materials. Kazakhstani oil companies will be forced to reduce oil production due to the inability to supply gas for processing.
23.12.2025 - Ukrainian UAVs attacked Stavrolen gas processing plant, part of Lukoil group.
03.03.2026 - Ukrainian unmanned boats destroyed Russian gas carrier "Arctic Metagaz" (9243148) off the coast of Libya. Unmanned boats were launched from the coast of western Libya.
17-19.03.2026 - Ukrainian UAVs attacked Russkaya and Kazachya compressor stations of Blue Stream gas pipeline and Beregovaya compressor station of Turkish Stream gas pipeline from Russia to Türkiye. Attacks were repelled.
02.04.2026 - Ukrainian UAVs attacked Russkaya compressor stations of Blue Stream gas pipeline. The attack was repelled.
05.04.2026 - attempt of Ukrainian agents to blow up gas pipeline between Hungary and Serbia, which is a continuation of Turkish Stream. The attack was prevented.
13.05.2026 - Ukrainian UAVs attacked Astrakhan Gas Processing Plant. A fire was observed at the plant site.
24.06.2026 - Ukrainian UAVs attacked Orenburg Gas Processing Plant and Orenburg Helium Plant. A fire was observed at the plants’ sites.
08.07.2026 - Ukrainian UAVs attacked Krasnodarskaya compressor stations, supplying gas to Blue Stream gas pipeline to Türkiye and domestic Dzhubga-Lazarevskoye-Sochi pipeline.
Gas consumption
The decline in natural gas exports, both in the form of pipeline gas and LNG, requires and at the same time stimulates the consumption of natural gas within the country.
Consumption volumes
In 2023, gas consumption in the domestic market amounted to 496 bcm. In 2024, gas consumption in Russia reached 522 bcm (+5.2% by 2023). 76% of the produced gas is consumed in Russia.
According to the Energy Strategy of the Russian Federation until 2050, the following indicators of gas consumption in the domestic market are established:
2030 - 560 bcm.
2036 - 589 bcm.
2050 - 669 bcm.
Major projects to increase natural gas consumption:
Gasification of the Murmansk region as part of the construction of the Murmansk LNG and the main gas pipeline leading to it.
Gasification of Eastern Siberia as part of the construction of the Power of Siberia-2 main gas pipeline to China
Gazprom's pre-gasification programs in Russia. Plans for 2021-2025 include 72 regions, 24,000 kilometers of new gas pipelines, 538,000 households, and 3,000 boiler houses.
On April 9, 2025, Gazprom delivered more than 1.217 billion cubic meters of gas to Russian consumers, which was a record for this month. The previous record was set on April 3, 2012, when the volume of supplies amounted to 1.152 billion cubic meters of gas.
Gas-fired power generation
Russia is top 3 by installed capacity of gas-fired TPPs. Installed capacity of gas-fired TPPs in the country is 113 GW. Theoretical maximum demand from gas generation is 679 mcm/d.
Growth points of Russian gas generation:
Yuzhno-Yakutskaya TPP in Yakutia,
Svobodnenskaya TPP in Amur region.
One of long-term bottlenecks of gas generation in Russia was lack of domestically produced high-power gas turbines. Russia relied on supply of gas turbine engines from Germany and USA. Starting in 2014, problems began with the supply of these types of turbines. Russia began design and piloting of local turbines. As of 2026, two turbines have been created and are gradually entering serial production:
GTE-170 from Power Machines. The rated electric power is 170 MWh/h.
GTD-110M from ODK. The rated electric power is 115 MWh/h.
Production plan of Power Machines for GTE-170 for 2026 is 7 units. An increase is expected in the future. ODK produced the fourth GTD-110M turbine in July 2026. The first turbine was delivered in September 2024. Effective production rate is 2 turbines per year. With launch of a new production facility in Rybinsk, it is planned to increase production to 4 turbines per year.
Serial production will not only solve the problem of energy deficit in certain regions, but also increase domestic gas consumption. Annual production of these two kind of turbines alone helps to add -2.7 bcm per year to domestic demand for gas (319 mcm year for 7 GTE-170 and 216 mcm per year for 2 GTD-110M with assumed 70% utilization).
Production and export of urea
Use of gas for fertilizer production is growing in Russia. This is a consequence of earlier investments in production capacities and high global gas prices, stimulating import of fertilizers from countries with cheap energy. However, the launch of new investment projects in 2024-2025 was hindered by high key rate of Central Bank of Russia (20% as of 18.06.2025, 14.25% as of 25.06.2026).
Russia is the world leader in export of urea. In recent years, there has been a positive trend in production and export of urea (carbamide) produced from natural gas. It takes about 0.7 bcm of gas to produce 1 million tons of urea.
Export by year:
2021 - 9.5 million tons
2022 - 9.5 million tons
2023 - 10.7 million tons
2024 - 10.8 million tons
2025 -11.8 million tons
Russian urea exports in 2024 accounted for 24% of total fertilizer exports from Russia (42 million tons). Largest buyers of Russian urea are Brazil (4.1 million tons) and India (1.7 million tons).
Since 1.07.2025, EU has imposed additional restrictions on import of Russian fertilizers (including 40 EUR / 3 400 RUR duty per ton), forcing Russian producers to increase their direct exports of urea to end-users by sea.
Largest buyers of Russian urea in 2025 were Brazil, India, USA, and EU.
Main competitors in international markets are China, Saudi Arabia, USA, and EU. EU previously re-exported up to 2 MTPA of Russian urea.
It is worth noting that Russia actively supplies gas to China and EU, while these countries are the largest producers and exporters of urea produced from natural gas. This suggests that it is economically attractive to replace production of urea in these countries (especially in EU) with more profitable domestic production in Russia.
Production and export of methanol
The production of methanol (methyl alcohol) in 2024 amounted to 3.8 million tons. In 2021, production was 4.5 million tons. It takes about 1 billion cubic meters of natural gas to produce 1 million tons of methanol.
Production capacity in 2025 is -5.6 million tons/year. The capacity forecast for 2030 is 9.2 million tons per year.
The largest producers of methanol in Russia:
Shchelkinoazot (until November 2024, after which production was stopped for economic reasons)
Metaphrax Chemicals
Gazprom Methanol
Tomet
NAC Azot
Nevinnomyssky nitrogen
ANKHK
Akron
Manufacturers are reducing production amid problems with the restructuring of export logistics. There is a product reorientation towards the production of ammonia and nitrogen fertilizers.
Domestic consumption of methanol in 2024 amounted to 2.55 million tons. The main directions of methanol consumption:
Production of formaldehyde and carbamide-formaldehyde concentrate (CFC)
Isoprene production
Production of oxygenates (MTBE, TAME).
Application in the oil and gas industry
By the end of 2024, methanol exports amounted to 1.25 million tons. Exports are declining - in 2023 there were 1.5 million tons, in 2021 - 1.9 million tons. The key factor in the decline is the EU's self-ban on Russian methanol imports. The main export destinations of Russian methanol in 2021 were Finland, Poland, and Slovakia (30 countries in total). In 2024, China (63% share), Turkey (20% share), Belarus (9% share), Kazakhstan (5% share), the United Arab Emirates and Georgia (8 countries in total).
After 2022, the main export route is through the terminal in Nakhodka. The terminal's capacity is 1 million tons per year. In 2024, exports through it amounted to 720 thousand tons. At the same time, until 2022, this terminal was refocused on the export of light petroleum products due to the disadvantage of exporting methanol directly.
Russia is developing a new methanol export infrastructure, in particular, the Vysotsk and Sukhodol marine terminals.
Production and export of helium
Helium is produced as part of purification of extracted natural gas. Helium producers in Russia are Amur and Orenburg gas processing plants, owned by Gazprom, and Irkutsk Oil Company. Total annual capacity of these plants is 55 million cubic meters per year as of 15.04.2026.
One of the leading traders of Russian helium is Gazprom Helium Service LLC.
In June 2024, European Commission imposed a ban on import of Russian helium into EU.
In 2025, production reached 20 mcm of helium. Utilization rate was 36%.
Low utilization rate is explained by shortage of specialized helium cryogenic tanks. After EU traders left Russian market, there was a shortage of specialized containers. As of the beginning of 2025, there were only 30 specialized helium tanks owned by Russian traders. In 2025, 30 tanks were purchased from China.
Domestic production of cryo tanks is currently being developing (Kriogenmash JSC - HELIUM CM 42, prototype as of May 2026). This will allow Russia to join elite club of countries that produce the most sophisticated cryogenic equipment (USA and China).
Production volumes in 2025 by plant:
Orenburg GPP - 3.1.
Amur GPP - 13.5 (an increase of 40% compared to 2025).
Irkutsk Oil Company - 3.4 (an increase of 40% compared to 2025).
Russian helium market is in surplus.
Exchange trading of Russian helium is organized on Petersburg Exchange.
In 2025, Russia became the world's third-largest exporter with a market share of 12%. Only Qatar and USA are ahead.
In 2025, Russia imported 13 mcm of helium to China. Russia is the second-largest supplier of helium to China after Qatar. Increase in helium imports to China is fueled by launch of Amur GPP.
Key facility in logistics chain for supply of liquid helium from Amur GPP to China and other Asian countries is helium hub located in Nadezhdinskaya special economic zone in Primorsky Krai, near the seaports. Design capacity of the logistics center is 100 mcm per year (4000 ISO containers per year).
In March 2026, due to decrease in natural gas production in Persian Gulf region and blockade of the Strait of Hormuz, helium exports also suffered. Global supply of helium decreased by a third. On 14.04.2026, Government of Russia restricted export of Russian helium outside Eurasian Economic Union until end of 2027.
Gas engine fuel
Compressed natural gas (CNG) and liquefied natural gas are used as gas engine fuels. At the same time, liquefied petroleum gas (LPG) remains to be main gas engine fuel in Russia.
For 12 years, Russian gas engine market (CNG and LNG only) has grown almost 4 times. In 2025, methane consumption as motor fuel amounted to 2.78 bcm. This represents 0.4% of Russia's gas production. Of these, 2.68 bcm were consumed in automobile fuel segment.
Of the 2.68 bcm of methane (natural gas), 2.25 bcm were consumed in CNG form and 0.31 bcm in LNG form. Government plans to increase natural gas consumption as a vehicle fuel by 2035 to 8.2 bcm (CNG - 6.2 bcm, LNG 1.4 - bcm) in baseline scenario and to 10.7 bcm (CNG - 8.2 bcm, LNG 1.8 - bcm) in target scenario.
The market is growing both due to sale of new methane-fueled vehicles and the conversion of existing vehicles to methane. As of 2025, there are 376 thousands methane-powered vehicles in Russia. Structure of the fleet of methane-powered vehicles (CNG and LNG) includes:
passenger cars - 219 thousands;
light and medium-duty trucks for urban, suburban, and regional transportation over short and medium distances - 119 thousands;
heavy-duty trucks - 5.3;
city and suburban buses - 34 thousand;
intercity and tourist buses - 421 units.
Government's plans include an increase in CNG and LNG fleet to 985 thousands in baseline scenario and 1289 thousands in target scenario by 2035. The largest relative growth is expected in the bus and truck segments.
According GAI, as of 01.01.2026, there were 68 million vehicles registered in Russia, including:
52.8 million passenger cars;
8 million trucks;
757 thousand buses.
Design and production of domestic gas-fueled models is actively growing. Key projects:
At Avtotor the first conveyor-based production of gas-fueled cars in Russia has been launched.
AvtoVAZ is increasing production of natural gas-powered cars (Lada Largus CNG) after a lull in 2022-2025,
KamAZ is expanding its range of gas-powered vehicles. The company is producing buses for shift workers, mobile workshops for Gazprom and other oil companies. A LNG-powered truck tractor has been introduced.
BelAZ has introduced a gas-diesel version of a mining dump truck.
One of the obstacles to increase of of usage of LNG-fueled heavy trucks is lack of domestic production of cryogenic fuel tanks . All current domestically produced models of LNG-fueled heavy trucks use Chinese fuel tanks. As of May 2026, Cryogenmash JSC has developed fuel tanks for KamAZ and BelAZ and is undergoing certification from car makers , which will allow for the transition to domestic products starting in 2027.
Conversion of used cars to methane began in 2012. 7 thousand gas-fueled vehicles were produced in 9 months of 2024. It is the converted used vehicles make up majority of the gas-fueled fleet. There is a state program of subsidizing the transition to gas fuel.
Gazprom plays an important role in the process of popularizing gas engine fuel: by the beginning of 2024, 15 thousand of the company's vehicles were converted to natural gas, which is 63% of the total fleet suitable for conversion.
As consequence of fuel crisis of summer of 2026, the transition to gas began accelerating. Estimated transition rate is 500-1000 used cars per day (peak value).
As of the end of 2025, there are 1300 CNG filling stations on public road network in Russia. Government plans to increase by 2035 this number to 2200 in baseline scenario and to 2700 in baseline scenario.
Сonsumption of natural gas as a motor fuel has also increased almost 4 times – from 390 million cubic meters to 1.5 billion cubic meters.
In August 2025, Russian government approved Conception for Development of Gas Fuel Market in Russian Federation till 2035.
The gas engine fuel market will continue to develop over the next 10 years. In order for it to be dynamic, it is necessary to solve complex tasks: to develop the refueling infrastructure, including increasing the production of mobile refueling complexes, as well as to carry out a large-scale conversion to economical and environmentally friendly motor fuels not only for automobile, but also for river, railway, and agricultural transport.
Automobile market is the main segment of gas fuel, but it is not the only one. Total consumption of all other segments in 2025 was about 0.1 bcm. Government plans to increase consumption in these segments by 2035 to 1.5 bcm in baseline scenario and to 3.2 bcm in target scenario. The following segments of gas-fueled vechicles are being developed, including at the state level:
marine and river transport vessels, mixed "river-sea" vessels, vessels that provide bunkering with liquefied natural gas (methane), auxiliary vessels, and fishing vessels;
mainline and shunting locomotives;
agricultural machinery and equipment;
public utilities, road construction, and other specialized machinery;
quarry dump trucks;
mobile car gas refuelers.
The development of the gas-powered fuel market is synchronized with the development strategies of domestic mechanical engineering in the relevant fields.
Impact of LNG production on domestic market prices
Domestic gas prices and LNG exports from Russia are not interrelated as of 2025.
The gas production, production and export systems of the Yamal LNG and Sakhalin Energy large-capacity LNG plants are independent of Gazprom's Unified Pipeline Network.
The medium-tonnage plants Cryogaz-Vysotsk and Gazprom LNG Portovaya have practically suspended LNG production. Network gas consumption as of the second quarter of 2025 is estimated at 1 billion cubic meters per year (only one of the two Gazprom LNG Portovaya lines is operating).
The theoretical launch of new LNG plants in Ust-Luga and Murmansk may change this situation - the demand for mains gas will amount to 46 billion cubic meters, excluding auxiliary consumption for energy generation and gas transportation. This is equivalent to 9% of domestic demand in 2025, but still less than the available reserve of production capacity.
Exchange trading
Russia is developing exchange trading of natural gas on the domestic market. Exchange trading with physical gas supply is implemented on the St. Petersburg Stock Exchange (formerly the St. Petersburg International Mercantile Exchange).
The volume of exchange trading in natural gas in the first quarter of 2025 amounted to 4.1 billion cubic meters, an increase of 20% compared to the fourth quarter of 2024. Currently, 2.3% of the natural gas produced in the country is sold through the exchange.
Gas prices in Russia are still among the lowest in the world. The quotation of the National Exchange Index of Natural Gas Prices for delivery in April 2025 on the St. Petersburg Stock Exchange (formerly the St. Petersburg International Mercantile Exchange) was 4.65 rubles per cubic meter. This is 10 times lower than wholesale gas prices in Europe and East Asia. This price difference creates significant price advantages for the development of natural gas processing industries in Russia, including the production of methanol and agricultural fertilizers.
Domestic market prices
The final prices of the domestic gas market, primarily for the population, are regulated. As a rule, they are increased annually with a validity period of the first of July each year. Their planned growth will be determined by the FAS based on a review of Gazprom's proposals. The amount of tariff increases is an important component of the country's inflation. Historically, Gazprom has cross-subsidized domestic gas prices at the expense of export earnings. Sales volumes in the domestic market exceeded exports by 2-3 times in physical terms, but they brought in 2-3 times more revenue. Gas exports to Europe in the 2010s were the key not only to the financial well-being of Gazprom Group and the Russian budget directly, but also indirectly to relatively low prices on the domestic market and low utility bills by global standards.
Since 12/01/2022 (in advance of the planned date of 07/01/2023), regulated gas prices for the population and industry have increased. The growth was 8%.
Regulated prices for the population and industry have increased since 07/01/2024. The growth was 8%.
Since 07/01/2025, regulated prices for the population have increased - the weighted average price in the second half of 2025, according to FAS calculations, will be 8 rubles 32 kopecks per cubic meter, compared with 7 rubles 56 kopecks in the first half of the year. The growth is 10.3%. For enterprises of the electric power industry and housing and communal services, the growth will be 21.3%, which equalizes the price for this segment with the prices of industry. Earlier, in 2023-2024, a less significant growth was planned for this date - 8%. Thus, the price increase has become higher than planned. It is worth noting that the inflation target set by the Bank of the Russian Federation is 4%. The key rate as of 07/01/2025 is 20%. Higher gas prices will delay the achievement of the inflation target.
The key reason for the increase is a decrease in Gazprom's cross-subsidization of domestic prices for the population, the electric power industry and the fuel and energy sector due to a drop in export earnings. In part, Gazprom's losses (more precisely, Gazprom Group's gas business, excluding dividends from Gazpromneft and other subsidiaries) are being compensated by other methods, such as selling corporate real estate, reducing excessive costs for sports projects, and reducing the bloated staff of management and administrative staff. Final gas prices continue to be one of the lowest in the world despite all the increases, but gas will cease to be a conditionally free commodity.
Shipbuilding
Previously, Arc7 ice-class LNG carriers were ordered to South Korean shipyards. They are partially built and awaiting political decisions. Four LNG carriers have been built by the South Korean company Hanwha Ocean and have already passed sea trials: Petr Kapitsa, Lev Landau and Zhores Alferov (all named after legendary professors of Moscow Institute of Physics and Technology) and Ilya Mechnikov. Deliveries of these gas carriers are delayed due to US political pressure on South Korea. The owner and operator of the first three gas carriers is Sovcomflot, and the fourth is Mitsui OSK Line.
Completion on 23.12.2025 of sea trials of LNG carrier Alexey Kosygin (9904546) and its delivery to Sovcomflot allowed Zvezda Shipyard and Russia as a whole to join the very prestigious club of shipbuilders of modern LNG carriers. Until this moment, only two countries in the world were building LNG carriers – the undisputed leader South Korea and pursuing China. South Korea has build LNG carriers with total cargo capacity of 4.8 million tons of LNG in 2025, while China - 1.3 million tons.
Dynamics of LNG carriers commissioning by country of build, tons of cargo hold capacity
Domestic construction of LNG carriers has tremendous multiplicative effects. Not only will it increase winter shipments from Arctic LNG 2 plant, but it will also revive currently steel industry and create high demand for advanced propulsion and cryogenic equipment. This will create additional jobs for Russian citizens and potential to attract North Korean workers.
18.06.2026 new Arc7 ice-class LNG carrier Konstantin Posyet (9904704) were commissioned by SKK Zvezda. In addition, two new LNG carriers Petr Stolypin (9904675) and Sergey Witte (9904687) are expected to be completed by Zvezda shipyard in 2026.
Notes:
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