Russian gas company Gazprom missed its own “conservative” target for 2021 exports to Europe, and those capped flows contributed to the continent’s worst energy supply crunch in decades.
Gazprom delivered 185.1 billion cubic metres to its main clients abroad, including Turkey, China and the EU, excluding former Soviet Union nations outside the bloc, chief executive Alexey Miller said in a statement on Sunday.
That was 3.2 per cent above 2020 levels, but lower than 2018 and 2019, which were about 200 billion cubic metres.
Deliveries to Europe and Turkey were about 177 billion cubic metres last year, according to calculations by Bloomberg News and BCS Global Markets based on Gazprom’s data. That fell short of Gazprom’s forecast for exports to Europe and Turkey of as much as 183 billion cubic metres – an estimate it has stuck to since the spring and maintained at the end of October, even as Europe clamoured for more supplies.
While Gazprom’s flows to Europe and Turkey were below the company’s outlook, they were in line with recent estimates from BCS Global Markets, said Ron Smith, the company’s senior oil and gas analyst in Moscow.
“It was clear in recent weeks that high prices had caused a reduction in nominations from its European customer base,” he said.
Flows to Europe and Turkey could be even lower – at about 175.4 billion cubic metres last year, based on assumption that Gazprom’s daily flows to China were more than a third above its contractual volumes in November and December, said Mitch Jennings, an energy analyst at Sova Capital.
Gazprom’s exports have been scrutinised as tight supplies in Europe recently sent prices soaring. With it being winter and the region’s stockpiles falling dangerously low, the company has sent only as much gas to EU clients as it is obliged to supply under long-term contracts. It has not offered spot cargoes for months.
It is not known why Gazprom has been reluctant to offer spot gas to the bloc. While the company has pointed to demand destruction as a result of surging regional prices, European officials say the Russian producer is intentionally withholding in the hope of speeding up approvals for the contentious Nord Stream 2 pipeline.
Gazprom does not break export data down by country, making it difficult to estimate 2021 flows to individual markets. But Mr Miller said the largest growth in deliveries was to Germany, Turkey and Italy. Flows to China exceeded Gazprom’s contractual obligations throughout 2021, Mr Miller said.
Daily exports outside ex-USSR nations in December, when the peak demand season often starts, averaged 439 million cubic metres – the lowest level for that month since 2014, according to Bloomberg calculations.
Gazprom’s gas output for 2021 reached 514.8 billion cubic metres, the highest since 2008. December daily production averaged 1.523 billion cubic metres, the highest since 2013 for that month.
With Russian pipeline exports to most EU countries capped in December, the bulk of the extra gas stayed at home as abnormally low temperatures set in during the final days of the year.
As temperatures plunged, deliveries to domestic clients in late December surged to as high as 1.656 billion cubic metres a day, Gazprom said, higher than its average daily production levels for December. To meet the demand, the company said withdrawals from local underground storage reached a five-year high.
Russia can afford to draw record amounts from its inventories as Gazprom filled the domestic sites with all-time high gas volumes of 72.6 billion cubic metres by November.
Three trading apps to try
Sharad Nair recommends three investment apps for UAE residents:
- For beginners or people who want to start investing with limited capital, Mr Nair suggests eToro. “The low fees and low minimum balance requirements make the platform more accessible,” he says. “The user interface is straightforward to understand and operate, while its social element may help ease beginners into the idea of investing money by looking to a virtual community.”
- If you’re an experienced investor, and have $10,000 or more to invest, consider Saxo Bank. “Saxo Bank offers a more comprehensive trading platform with advanced features and insight for more experienced users. It offers a more personalised approach to opening and operating an account on their platform,” he says.
- Finally, StashAway could work for those who want a hands-off approach to their investing. “It removes one of the biggest challenges for novice traders: picking the securities in their portfolio,” Mr Nair says. “A goal-based approach or view towards investing can help motivate residents who may usually shy away from investment platforms.”
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
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What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
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Muslim Council of Elders condemns terrorism on religious sites
The Muslim Council of Elders has strongly condemned the criminal attacks on religious sites in Britain.
It firmly rejected “acts of terrorism, which constitute a flagrant violation of the sanctity of houses of worship”.
“Attacking places of worship is a form of terrorism and extremism that threatens peace and stability within societies,” it said.
The council also warned against the rise of hate speech, racism, extremism and Islamophobia. It urged the international community to join efforts to promote tolerance and peaceful coexistence.
