Russia cuts natural gas output, export forecasts

• Russian pipeline gas exports to Europe plunged 44% in 2025 to just 18 bcm, the lowest since the mid-1970s, down from a peak of around 180 bcm annually in 2018-2019
• LNG exports are forecast to rise to 35 million tons in 2026 from 30.3 million tons in 2025, but at a slower pace than previously expected
• The downward revisions come as Russia has also cut its 2026 oil output forecast to a 17-year low amid ruptured economic ties with the West

Russia Cuts Natural Gas Output and Export Forecasts

Key Developments

Russia's economy ministry has downgraded its natural gas production and export forecasts as Europe prepares to cease all Russian gas purchases by next year. According to a draft government document, these projections will be used to update the federal budget through 2029.

Production and Export Figures

2026 Forecasts:

• Natural gas production: 683.1 billion cubic metres (bcm), down 5.3 bcm from May projections, but above 2025's actual 662.7 bcm
• Pipeline gas exports outside ex-Soviet Union: 77.0 bcm (revised from 75.0 bcm)
• LNG exports: 35 million tons, up from 30.3 million tons in 2025, but 5.3 million tons below previous estimates

Historical Context:

Russia's gas exports to Europe plummeted 44% in 2025 to just 18 bcm—the lowest since the mid-1970s—following closure of the Ukrainian transit route. This compares to peak exports of around 180 bcm annually in 2018-2019.

Pricing Outlook

Gas prices outside the ex-Soviet Union are forecast at $402.90 per 1,000 cubic metres in 2026, up from the May estimate of $336.30. Prices for China are projected at $247.90, down slightly from the previous $258.80 forecast.

Market Implications

The downward revisions reflect ruptured economic ties with the West over the Ukraine war and Europe's plans to eliminate Russian gas purchases. While LNG exports are expected to grow in coming years, the pace will be slower than previously anticipated. Russia has also recently cut its 2026 oil output forecast to a 17-year low, compounding pressure on its energy sector revenues.

Total oil and gas exports are projected at $219.4 billion in 2026.