Russian gas

Politics Before Profit

gazprom_dpa_effect
Dodgy deal: Alexey Miller signed a gas contract with the Chinese under the watchful eye of Vladimir Putin.
  • Why it matters

    Why it matters

    Gazprom, already suffering from high costs and falling energy prices, cannot afford to continue signing costly, politically motivated deals.

  • Facts

    Facts

    • Gazprom, after flirting with Western companies in recent years, has reverted to Kremlin control.
    • In the wake of the Ukraine crisis, the Kremlin forced it to reroute the South Stream pipeline through Turkey.
    • Gazprom has just signed a gas-supply deal with China that is likely to generate losses.
  • Audio

    Audio

  • Pdf

The film “No More Mr. Nice Guy” is one of the best German road movies. After a madcap journey, the story ends unexpectedly with the heroes at the banks of the quietly flowing River Don in Russia.

The script could be a model for Gazprom, the world’s largest gas company. “No More Mr. Nice Guy” appears to be the new maxim of Alexey Miller, the firm’s chief executive. It seems he’s adopted it partly as an act of defiance, and partly as a necessity.

Gazprom, despite Mr. Miller’s efforts, has reverted to a Kremlin-controlled company that is almost 100 percent a political entity.

Mr. Miller, who has been CEO since 2001, had tried to reposition the gas giant, delighting Western shareholders and industry partners. But those times are gone.

Things have been different since Russia annexed Crimea a little over a year ago. Mr. Miller, who has led Gazprom for as long as his benefactor Russian President Vladimir Putin has sat in the Kremlin, is once again maneuvering to represent political interests.

It should be noted that Russian leadership is not solely to blame. The European Union has never developed a constructive relationship with Gazprom, though the gas company hasn’t made it easy for Brussels with its constant calls for exemptions from the rules.

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