Gazprom Plans Major Downsizing Amidst European Export Crisis
Russia's leading gas producer considers cutting 40% of its management amid a sharp decline in European sales.
In a move that underscores the gravity of Russia's shifting energy landscape, Gazprom, the country's leading gas producer, is contemplating a significant reduction in its managerial workforce.
According to a report from Reuters, these proposed cuts could result in the dismissal of approximately 1,500 employees from the company's management ranks alone.
The development follows a leaked memo revealing that a proposal for this downsizing had been submitted to the company's leadership.
The initial information about the prospective cuts was reported by the Russian news outlet 47news, which cited a leaked letter.
This letter was reportedly sent by Gazprom's Deputy CEO to the company's CEO Alexey Miller, stationed in St. Petersburg.
It detailed a recommendation to trim the company's headquarters staff by about 40%, reducing numbers from 4,100 to 2,500 employees as a cost-saving measure related to salaries.
A spokesperson for Gazprom confirmed to Reuters the authenticity of the report, indicating that the leadership was favourably considering this proposal, though no final decision has been made.
In a broader context, Gazprom employs a total of 498,000 people worldwide.
This potential downsizing comes at a time of significant financial strain for Gazprom.
In 2023, the company recorded a loss nearing USD 7 billion, primarily due to the erosion of its European market share—a consequence of geopolitical tensions following the conflict in Ukraine.
Gazprom's sales took another downturn after Ukraine announced in December that it would terminate the transit of Russian gas through its territory starting January 1, 2025, following the decision not to renew the transit agreement.
This development could have notable implications for both Gazprom's operational strategies and the broader energy supply dynamics in Europe.
As the situation continues to unfold, Gazprom's strategic response to its diminishing European foothold will be closely watched by industry stakeholders and geopolitical analysts alike.
According to a report from Reuters, these proposed cuts could result in the dismissal of approximately 1,500 employees from the company's management ranks alone.
The development follows a leaked memo revealing that a proposal for this downsizing had been submitted to the company's leadership.
The initial information about the prospective cuts was reported by the Russian news outlet 47news, which cited a leaked letter.
This letter was reportedly sent by Gazprom's Deputy CEO to the company's CEO Alexey Miller, stationed in St. Petersburg.
It detailed a recommendation to trim the company's headquarters staff by about 40%, reducing numbers from 4,100 to 2,500 employees as a cost-saving measure related to salaries.
A spokesperson for Gazprom confirmed to Reuters the authenticity of the report, indicating that the leadership was favourably considering this proposal, though no final decision has been made.
In a broader context, Gazprom employs a total of 498,000 people worldwide.
This potential downsizing comes at a time of significant financial strain for Gazprom.
In 2023, the company recorded a loss nearing USD 7 billion, primarily due to the erosion of its European market share—a consequence of geopolitical tensions following the conflict in Ukraine.
Gazprom's sales took another downturn after Ukraine announced in December that it would terminate the transit of Russian gas through its territory starting January 1, 2025, following the decision not to renew the transit agreement.
This development could have notable implications for both Gazprom's operational strategies and the broader energy supply dynamics in Europe.
As the situation continues to unfold, Gazprom's strategic response to its diminishing European foothold will be closely watched by industry stakeholders and geopolitical analysts alike.
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