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Kazakhstan increased oil exports by 10 times bypassing Russia

Kazakhstan sharply increased oil exports bypassing Russia after a series of incidents at the terminal in Novorossiysk, through which more than 80% of Kazakh barrels were exported before the war.

At the end of 2022, Kazakhstan exported 1.328 million tons of oil through the ports of Georgia – 10 times more than a year earlier, Reuters calculated   based on data from traders and forwarders.

By contrast, oil exports through Russia have fallen by more than a quarter after authorities repeatedly suspended operations at the Caspian Pipeline Consortium’s Black Sea berths, citing repairs, pollution and the need to search for World War II mines.

Over the year, Kazakhstan exported 1.862 million tons of oil through Russia against 2.554 million tons in 2021, Reuters calculated.

The port of Batumi has become the main alternative for Kazakh oilmen, on whose income more than half of the country’s budget depends. Exports through it “growth because of the sanctions,” an oil trader in the region told Reuters: Kazakhstan is seeking to cut itself off from ties with Moscow and has even renamed an oil grade that used to go on the market as Urals.

The largest oil and gas producer in Kazakhstan, Tengizchevroil, shipped 252.5 thousand tons of oil to Batumi last year, despite the fact that transportation to the Georgian port is more complicated and more expensive than to Novorossiysk.

“Batumi is an alternative direction (to Russian ports), the economy does not play a role,” the source explains to Reuters.

The United States is actively cooperating with the Kazakh authorities to launch oil exports from the country bypassing Russia, US Ambassador to Astana Daniel Rosenblum said last November. According to him, the talks involve both American companies producing oil at the largest Tengiz field in Kazakhstan, and partners from other countries.

In the summer, Kazmunaigas agreed with the Azerbaijani SOCAR on the export of 1.5 million tons per year, or 30,000 barrels per day. From 2023, these volumes will be increased to 5 million tons.

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