Gazprom Shares Slide on Dividend Absence and China Pipeline Uncertainty
Market Reaction and Key Developments
Gazprom Share Performance
MOSCOW, May 21 (Reuters) - Gazprom shares continued their slide on Thursday, pressured by the previous day's announcement that it would not pay a dividend on 2025 results and by Russia's continued failure to clinch a deal on a new gas pipeline to China.
Shares in Russia's largest natural gas producer lost almost 1% to 117.9 roubles in early trade on the Moscow stock market, extending the previous day's 3.5% decline.
Investor Sentiment
"Yesterday, the Moscow Exchange index fell by 1.2%, unable to withstand a double disappointment: reports from China about the lack of clarity regarding the timeframe for implementation of the Power of Siberia 2 project and Gazprom's refusal to pay dividends for 2025," Sinara Investbank said in a note.
Company Valuation and Strategic Challenges
Capitalisation Drop
Gazprom's capitalisation has dropped to only 2.8 trillion roubles ($40 billion), a far cry from the $1 trillion promised by management in 2008.
Loss of European Market
The company has lost lucrative European Union sales since Russia's invasion of Ukraine in 2022 ruptured trade and political ties with most of Europe.
China Pipeline Negotiations
Putin-Xi Meeting Outcome
Russian President Vladimir Putin met China's Xi Jinping in Beijing on Wednesday, but the two leaders failed to reach a breakthrough on the planned Power of Siberia 2 pipeline that would enable Russia to more than double its natural gas exports to China.
Exchange Rate Context
($1 = 70.8000 roubles)
Reporting Credits
(Reporting by ReutersEditing by David Goodman)
