"The Situation Continues To Deteriorate."

• 15.07.2025, 13:52

More than a quarter of Russia's coal companies are on the verge of financial collapse.

The severe crisis that hit the Russian coal industry after the loss of European markets and the strengthening of international sanctions is growing, according to a report by Russian Deputy Energy Minister Dmitri Islamov, writes The Moscow Times.

According to him, more than fifty coal companies are already under the threat of closure. "According to the Energy Ministry, there are 51 enterprises in the so-called red zone, i.e. mines and surface mines, that are either shut down or on the verge of shutdown," the official said at a meeting of the Federation Council's committee on economic policy. In total in Russia, as of the beginning of 2024, 179 coal-mining enterprises (52 mines and 127 surface mines) were operating.

Also Islamov stated that at the end of 2024, the losses of the Russian coal industry amounted to 112.6 billion rubles and "the situation, unfortunately, continues to deteriorate." Earlier, the deputy director of the Department of Coal Industry of the Ministry of Energy Dmitri Lopatin said that the same loss coal companies have already incurred in January-May 2025 (112 billion rubles).

By the end of the year, the total loss of the industry may reach 300-350 billion rubles - a level comparable to the annual budgets of large Russian regions. The Ministry of Energy emphasized that the key factors of such indicators were the creditworthiness of coal companies (the amount of loans is 1.2 trillion rubles), the situation on foreign markets (a decline in demand and a four-year low in coal prices), as well as the unfavorable ruble exchange rate.

On the background of huge losses, the rating agency NKR earlier suggested that the Russian coal industry may face a wave of consolidation within 12-18 months. Amid falling export revenues and financial problems, smaller companies will be absorbed by larger players or go through a bailout of losses.