Kazakhstan ramps up tanker fleet to circumvent Russian oil routes, boost exports

Kazakhstan is buying more and more tankers to transport its oil by sea as the largest oil producer in Central Asia is looking for alternatives to the main export pipeline through Russia, Bloomberg writes.

For supply through the Caspian, a division of the Kazakh state company "KazMunayGas" has already purchased two relatively small vessels with a deadweight of 8,000 tons by the standards of the oil industry, Deputy Minister of Energy Yerlan Akkenzhenov said. There are plans to buy two more oil tankers with a deadweight of 80,000 tons each for work in the Black Sea.

Kazakhstan continues to explore alternative options, although the route through Russia, via the Caspian Pipeline Consortium (CPC) pipe to the terminal in Novorossiysk, remains the most profitable, Akkenzhenov says.

According to him, it is "difficult for other modes of transport to compete" with CPC. Last year, about 80% of Kazakhstan's oil exports fell on this pipeline.

According to Akkenzhenov, this year Kazakhstan has already exported 300,000 tons of oil through the Caspian Sea and through the Baku-Tbilisi-Ceyhan oil pipeline, which runs from Azerbaijan to Turkey, and plans to send about 1.5 million tons this year. This is only a small part of the export of CPC, which this year amounted to 40.5 million tons of mainly Kazakh oil.

"We are also looking to resume and increase exports of oil products to Kyrgyzstan, Uzbekistan, Tajikistan and Europe," said the deputy minister.

At the same time, Kazakhstan is considering an option under which it will have to stop exporting oil through the Black Sea. According to the deputy general director at state-owned KazTransOil Erik Sagiyev, if the situation in the Black Sea water area worsens, the volumes that the company transports to Novorossiysk will be transferred to the port of Ust-Luga on the Baltic Sea.

In March 2023, Kazakhstan sent oil to Azerbaijan for the first time through the Caspian Sea, bypassing Russia.