Kazakhstan will increase its oil exports to Germany to 100,000 tons in April, says KazTransOil, the state oil transporter of Kazakhstan.
The move will reduce Germany’s dependence on Russian oil. As part of sanctions imposed by European countries against Russia following its invasion of Ukraine, the German government decided to forgo Russian oil imports. However, the new deal means that oil will be transported from Kazakhstan via the Russian pipeline.
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In January 2023, Kazakhstan secured an approval from Russia to pump oil to Germany via Russia’s Druzhba pipeline. Kazakhstan’s energy minister Bolat Aktschulatow had earlier stated the country plans to export 1.5 million tons of oil to Germany in 2023. This volume could possibly be ramped up to 7 million tons later in the year.
Ever since the oil exports deal began in December 2022, there have been questions about Kazakhstan’s role in Europe’s energy supply. A two-month delay in supply to Germany caused further speculations about Russia blocking the transit. Earlier in 2022, Kazakhstan attempted to bypass Russian routes to deliver up to 1.5 million tons of oil through the Baku-Tbilisi-Ceyhan pipeline.
Known as the Middle- Corridor, this involved loading oil tankers to cross the Caspian Sea and unloading onto freight transport through Azerbaijan, Georgia and Turkey. Considering infrastructural setup and logistics, Kazakhstan determined that this route was costlier than using Russia’s Druzhba pipeline.
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While the EU restricts the supply of Russian oil related materials transported by sea, they do not prevent third countries from using established infrastructure to sell oil in the European market. The German-Kazakh deal emerges to be the most convenient and cheap alternative. The use of Russian infrastructure to transport the oil sustains Germany’s dependence on Russia, retaining scope for future oil exports.
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By GlobalDataDespite sanctions, the German-Kazakh deal allows Russia to earn a transit fee from oil exports to Europe, weakening the continent’s embargo against Russia.
