Russia’s Coal Industry in Crisis as Dozens of Enterprises Face Closure
Russia’s coal industry is sliding deeper into crisis, with 51 mining enterprises already closed or on the verge of shutting down, according to the Russian Ministry of Energy.
Speaking at a government briefing, Dmitry Islamov, Deputy Head of the Ministry, confirmed that the country’s coal sector is experiencing widespread financial distress.
“According to the Ministry of Energy, there are currently 51 enterprises — both mines and open pits — that are in the so-called red zone,” Islamov said. “These are companies that have either ceased operations or are close to stopping altogether.”
As of January 1, 2024, Russia had 179 active coal mining enterprises. The 51 affected sites now represent nearly one-third of the entire sector. According to Islamov, total losses in the coal industry reached 112.6 billion rubles in 2024.
The decline comes despite coal’s importance to several Russian regions and its role in domestic energy and export revenues. However, weakening global demand, falling prices, logistical bottlenecks, and the impact of international sanctions have combined to put pressure on the industry.
The closures are particularly concerning for mining-dependent regions in Siberia and the Russian Far East, where coal provides both employment and municipal revenue. Local governments are reportedly facing growing social and economic strain as payrolls shrink and public budgets tighten.
In response, Russian Prime Minister Mikhail Mishustin announced on May 30 that the federal government is preparing a package of support measures. During a Cabinet meeting, Mishustin said the plan aims to “balance the situation in the coal sector” and prevent further collapse. However, he did not provide details on funding levels or eligibility criteria.
Some analysts are skeptical that state aid will be enough. Years of overproduction, underinvestment in modernization, and rising transport costs have made many mines unprofitable even before sanctions and export restrictions began to bite.
While the government has signaled an intent to keep coal as part of Russia’s energy mix, the current wave of closures suggests deeper structural problems that short-term subsidies may not solve.
Unless global demand rebounds or new state intervention proves more effective, Russia’s coal industry may be heading into a long-term contraction — with significant consequences for workers, regions, and energy policy alike.
