Russia’s Gazprom has maintained steady revenues from gas sales as soaring prices have compensated for its decision to cut supplies to Europe.

The Kremlin this week said it would keep the Nord Stream 1 pipeline, which transports gas to Europe via the Baltic Sea, shut as long as the west maintained economic sanctions. This means Gazprom is now delivering about 84mn cubic metres per day of gas to Europe via Ukraine and Turkey, from an average of 480mn cm/d last year.

But the reduction in supplies is expected to push this year’s prices up threefold on average compared with 2021, helping Gazprom increase total revenues by 85 per cent to $100bn, according to Ron Smith, oil and gas analyst at BCS Global Markets.

Last year, Gazprom exported its gas to Europe and Turkey at an average price of $310 per cubic meter, resulting in gross export revenue of $54bn. Now Smith estimates that over the whole of 2022, the company will supply 43 per cent fewer volumes but at an average price of $1,000 per cubic meter.

“A relatively small volume decrease can cause a large increase in gas prices, which can cause revenues to go up for the producer that had its supply reduced. In other words, you can make a solid case that Gazprom will earn more from supplying less gas,” he said.

Sergey Vakulenko, an independent Russian energy analyst, estimates that at current prices and deliveries, Gazprom is making about €250mn a day — the amount it would stand to lose if it were to stop all gas supplies to Europe. This compares with €290mn a day on average in 2019, the last full year before the pandemic and Vladimir Putin’s decision to launch a full-scale invasion of Ukraine.

In the first half of 2022, the Russian gas supplier recorded $41.75bn in net profit, from $29bn in profit for all of last year, according to a company statement last week. It paid a $20bn dividend to the state.

In 2019, before a coronavirus-related drop of supplies in 2020 and a continued squeeze in flows to Europe the following year, Gazprom reported profit of $16.3bn.

Some analysts say the price boost has prompted Gazprom to burn some of the gas it did not supply: the company has flared £8.5mn worth of the commodities daily in recent weeks, according to Wayne Bryan, an analyst at Refinitiv.

Russia is trying to turn to other end markets as the EU is accelerating efforts to end its reliance on Russian energy. In the first seven months of this year, gas exports to China rose 61 per cent year on year, albeit from a low level, according to Gazprom’s latest available data. Gazprom announced on Tuesday that Beijing would switch to paying for gas in yuan and roubles instead of dollars.

But most of Russia’s gas pipeline infrastructure points to Europe and Moscow cannot easily redirect these sales to anywhere other than its domestic market. The gas pipeline to China that Russia opened in 2019 is fed by different gasfields than those supplying the bloc.

“In the long term Russia is losing forever its largest and most reliable export market,” said Greg Molnár, an analyst at the International Energy Agency.