Russia's Gazprom Faces Over 1,500 Job Cuts Amid European Market Decline

[Social Media]

 

Gazprom, Russia’s state-owned gas giant, is preparing to lay off more than 1,500 employees at its central office in St. Petersburg as it deals with the loss of much of its European market. This comes as the company faces its first financial loss since 1999, driven by significant reductions in sales to Europe due to the ongoing conflict in Ukraine.

 

The potential job cuts were outlined in a letter from Deputy CEO Elena Ilyukhina to Gazprom CEO Alexei Miller, reported by state news agency TASS. The letter, dated December 23 and made public by the media outlet 47news, proposes reducing the central office workforce by about 40%, from 4,100 to 2,500 employees. Ilyukhina noted that the wage bill for the unit had escalated to 50 billion roubles ($488 million).

 

Gazprom, which employs approximately 498,000 people overall, confirmed the report through a company spokesperson contacted by Reuters. The company posted a loss of nearly $7 billion in 2023, marking its first loss in over two decades. This financial downturn was largely due to the drastic reduction in its European market share, following the halt of Russian gas exports via pipelines that cross Ukraine.

 

The situation worsened when, on New Year's Day, Ukraine refused to renew a transit deal, effectively cutting off one of Gazprom’s major supply routes to Europe. This left the company with only one viable route to Europe, through Turkey. Gazprom, once a dominant force in Europe’s energy market, now finds its influence significantly diminished.

 

Despite Gazprom’s challenges, Russia’s broader economy has shown resilience in adapting to Western sanctions imposed over the Ukraine conflict, with the national jobless rate at a historic low of about 2.4%. However, the country’s central bank has warned of potential economic overheating and rising inflation. Companies like Gazprom, heavily reliant on European markets, have been particularly impacted by these economic shifts.

 

As Gazprom navigates these turbulent times, the proposed job cuts reflect broader pressures on the company to streamline operations and adjust to the new realities of a diminished presence in Europe’s energy landscape.

 

Based on a report by Reuters 2024-01-15

 

 

[Tailwagsdog]

Excellent comrade, that's 1500 extra bodies for the frontline. At least a weeks worth of meat grinder assaults. 

[spidermike007]

It is quite heartening to see an incredibly corrupt company like Gazprom, who have enriched multiple oligarchs as well as the genocidal serial killing Putin suffer and decline. They richly deserve this. 

[zepplin]

6 hours ago, Tailwagsdog said:

Excellent comrade, that's 1500 extra bodies for the frontline. At least a weeks worth of meat grinder assaults. 

More like 1 day….