The shift from the status of an energy superpower that dictated the terms of the global market to the awkward position of a petrostate with dwindling export potential, technological backwardness and substantially reduced foreign-currency inflows will have long-term negative consequences for the Russian economy. Before Russia’s full-scale invasion of Ukraine, Gazprom supplied up to 40% of the European Union’s pipeline gas imports, and total gas exports reached around 180 billion cubic meters a year. By 2025, Russia’s total gas exports had fallen to 124.7 billion cubic meters, while Russia’s share of the European Union’s pipeline gas imports had dropped from 40% in 2021 to 6% in 2025. Importantly, due to damage to pipeline infrastructure and the destruction of relations wth Russia, this market cannot be expected to reopen any time soon. Attempts to compensate by rerouting gas exports to China have so far failed to generate a comparable level of revenue. Power of Siberia reached its designed capacity of only 38 billion cubic meters a year. Unlike pipeline gas, Russian liquefied natural gas long remained relatively free from sanctions restrictions. In 2025 and early 2026, the European Union bought almost 49% of all Russian LNG, accounting for up to 20% of the EU’s total LNG imports. It is this very channel that is now closing — gradually, but irreversibly. The REPowerEU regulation, which turned sanctions measures into permanent European legislation, imposed a ban on imports of Russian LNG under short-term contracts from April 25, 2026, while from Jan. 1, 2027, a ban on long-term contracts and on the transshipment of Russian LNG through European ports comes into force. Russia’s LNG sector faces a further problem. The country is dependent on foreign suppliers for the very process of liquefying natural gas. Without access to Western turbines, heat exchangers and specialized tankers, the state's goal of raising Russia’s share of the global LNG market to 20% by 2030 has become practically unattainable. The industry has entered a phase of stagnation and technological degradation. With the effective loss of the European market, Moscow has been forced to redirect its main LNG supplies to Asia, where China remains the dominant and, in effect, only large buyer. Despite the construction of a terminal in Longkou to receive output from Arctic LNG 2, only a modest 2.6 million tons a year have been exported, compared with the plant’s design capacity of 19.8 million tons. China buys Russian gas at a significant discount, deepening Russia’s one-sided dependence. To make matters worse for Moscow, its natural gas processing and export infrastructure has become a target for Kyiv, who carried out its first drone attack on July 7. The site in question, the Krasnodarskaya compressor station, is part of the infrastructure used to supply gas through the Blue Stream pipeline across the Black Sea to Turkey. The location of this attack matters a lot. Russian natural gas exports flow through the TurkStream and Blue Stream pipelines. As attacks against Russian oil infrastructure have shown, Ukraine is perfectly capable of destroying both compressor stations. If that happens, pipeline gas exports will be stopped completely. The full article under: The Moscow Times https://www.themoscowtimes.com/2026/07/15/russias-gas-industry-is-dying-a-slow-but-occasionally-explosive-death-a93257
