13 Jan 2010

Russia's gas production slumps to 25-year low

5:20 pm on 13 January 2010

Russia, which supplies a quarter of Europe's gas, has announced its biggest fall in production for 25 years.

Production by the energy giant Gazprom fell by 16% in the first 10 months of 2009, the BBC reports.

Gazprom blames the global economic downturn for a drop in consumer demand, but some analysts say the company has failed to invest in new gasfields to replace those that are running out.

Russia prides itself on its dominance of world energy supplies, in particular to Europe.

Last year, it overtook Saudi Arabia to become the biggest oil as well as gas producer.

But now figures released by the Energy Ministry show a sudden and dramatic decline in gas production in 2009.

The worry for Russia, whose economy is heavily dependant on energy exports, is whether this could be part of a longer term decline.