Gazprom (OTC: OGZPY), a global energy company headquartered in Russia, saw a decrease in its stock price, from $9.30 yesterday to $9.01 at close of business today. The stock opened at $9.09. The stock has lost 17% this quarter. Despite the 3.1% decrease, the volume increased tremendously. Yesterday’s volume was at 729,393 and the volume today surged to 3,592,668 shares.
Why the sudden increase? Perhaps it can be attributed to the Russian deal of the day service that sold coupons for the company’s stock. Biglion, similar to Groupon here in the United States, partnered with Finam, a Russian investment company, to sell Gazprom shares for $3 each, instead of the usual price of $23. The strategy was employed to help wannabe traders get on the Russian trading floor. The agreement also guarantees buyers a profit if they complete the deals in 45 days. The contracts are cancelled if no deals are made. Biglion hopes to add more trading deals to the service soon.
Selling Gazprom’s stock a part of a deal of a day service was obviously very successful. The average volume is around 1.2 million shares, although the volume has dipped below 600,000 shares multiple times since April. Volume did climb up to more than 3.5 million on June 7, just slightly less than 44,000 shares below today’s number.
In the past 52 weeks, stock prices have ranged from $8.57 to $15.01. Gazprom suffered a steep decline the week of May 11, 2012, when the stock started at $10.35 and quickly fell to $8.74. This was most likely attributed to the country’s gas crisis, which resulted in a decrease in sales. In fact, the company even hired German soccer player Franz Beckenbauer at the end of May to help promote the use of natural gas in the region. The company is a huge fan of soccer, acting as sponsor for two professional teams.
Gazprom, which supplies about 25% of the gas consumption in Europe, is currently fighting tax increases that could force the gas supplier to pay three times the amount it currently pays. The tax hikes could cause the company to see a 10% decrease in profit this year, from $66 billion to $58 billion.
Gazprom already has cut gas prices by 10% this year. In addition, retroactive discounts are being given to customers, resulting in $600 million in awards.
Gazprom owns the world’s largest gas transmission network, measuring 161,000 kilometers. Half of the gas the company produces is distributed to Russian customers, while the rest is exported to more than 30 countries. It is the largest power generator in Russia, accounting for 78% of Russia’s gas output. The company is also one of the country’s top oil producers. Gazprom is the only company in Russia that produces liquified natural gas.
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