• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 4 days Cheaper prices due to renewables - forget it
  • 4 days e-cars not selling
  • 5 days If hydrogen is the answer, you're asking the wrong question
  • 5 days How Far Have We Really Gotten With Alternative Energy
  • 5 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Premium Content

Kazakhstan Sees Oil Exports Constrained Due To Sanctions On Russia

  • KazMunayGas is forced to accept discounts on its crude carried via Russian pipeline network.
  • Most of the crude oil carried by the CPC pipeline belongs to Russia, Kazakhstan, and international oil majors such as Chevron.
  • The CPC pipeline accounts for two-thirds of Kazakhstan's crude exports.

Rising costs and sanctions on Russia have lowered the profitability of oil exports for Kazakhstan’s state oil and gas firm KazMunayGas, which has been forced to accept discounts on its crude being carried via the Russian pipeline network.

The CPC pipeline carries oil from Kazakhstan’s Tengiz oilfield to export infrastructure along the Black Sea coast. Most of the crude oil carried by the CPC pipeline belongs to Russia, Kazakhstan, and international oil majors such as Chevron. It remains a vital crude oil artery for Kazakhstan, accounting for two-thirds of the country’s crude oil exports.

However, after the Western sanctions against Russia over Putin’s invasion of Ukraine, Kazakhstan has had to accept discounts on the crude it sells as buyers have generally shunned exports out of Russia, KazMunayGas’s deputy executive chairman Dauren Karabayev said earlier this week, as carried by Upstream.

KazMunayGas reported on Tuesday increased revenues and profits for the first quarter of 2022, but the net profit rose by just 9 percent year over year despite soaring crude prices, as operating and tax costs other than income tax soared in Q1.

KazMunayGas and Kazakhstan also went through a month-long outage at two out of three terminals loading crude via the Caspian pipeline between the end of March and the end of April.

Kazakhstan is now rebranding the name of its crude to avoid being associated with crude from Russia when it loads exports from Russian ports. Kazakhstan exports are not under sanctions, but buyers have been cautious about the origin of crude loading from Russian ports.

As of June, KazMunayGas and other Kazakh companies have decided that they would use the name KEB?O (Kazakhstan Export Blend Crude Oil) in all documents and certificates of origin in order to stress the fact that the crude is of Kazakh origin and buyers do not have to wonder whether it’s Russian, KazMunayGas’s Karabayev said on Tuesday, cited by news agency Interfax-Azerbaijan.

By Charles Kennedy for Oilprice.com


More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News