Putin Looks to Cut Top Allies Loose as Profits Wither: Report

Russian President Vladimir Putin may dismiss one of his allies at the gas giant Gazprom or the country's largest oil producer, Rosneft, after the presidential election this month, as the country's gas sales wither because of sanctions, a report said.

Kommersant, a Russian daily newspaper, reported the development, citing sources familiar with the situation as saying that soon after the presidential elections—scheduled to take place between March 15 and 17—Putin may consider dismissing Alexei Miller, the chair of Gazprom, or Igor Sechin, the CEO of Rosneft.

After dismissing at least one of his two allies, the report said, Putin plans to replace them with Boris Kovalchuk, the son of the billionaire businessman Yury Kovalchuk, who is linked to the Kremlin and is known as Putin's banker.

Newsweek could not independently verify Kommersant's report and has contacted Gazprom and Rosneft for comment.

Figures released in January showed that Russia's gas sales to China have failed to make up for the lost trade with Europe caused by Western sanctions imposed over the ongoing war in Ukraine.

The energy industry is considered a crucial lifeline for Putin's economy, which has been hit hard by the sanctions. Russia's oil exports and energy industry make up about 30 percent of the country's budget revenues and are crucial for funding the war in Ukraine.

In October, closer trade ties with Beijing led Gazprom's Miller to say that gas supplies to China may "reach the level that we had for export to Western Europe." But a Russian central bank report released on January 30 showed supplies to China weren't close to making up for the shortfall caused by the exit of European buyers, Newsweek previously reported.

In 2023, flows from Russia to China via the Power of Siberia pipeline had increased by 7 billion cubic meters to 23 billion cubic meters, which was 1.5 times more than in 2022. But this only "partially compensated for their decrease from Russia through pipelines to Europe," the Russian central bank reported. They slumped by 38 billion cubic meters to 30 billion cubic meters.

In December, Gazprom said gas production in the first half of 2023 had tumbled by almost a quarter to 179.45 billion cubic meters, blaming the decrease on countries' "politically motivated decisions aimed at abandoning the import of Russian gas."

The gas giant's 2023 production of 404 billion cubic meters was about 9 percent lower than in 2022 because of fewer exports to Europe, Kommersant reported, according to Reuters.

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