Kazakhstan: Gas Shortages Force Astana to Look Elsewhere

The government of Kazakhstan is looking to two of its neighbors on the Caspian Sea to solve a domestic gasoline crisis. Almaty has entered into talks with Turkmenistan and Azerbaijan, two states that are not only rich in oil as is Kazakhstan, but also boasts of stronger infrastructure to develop their natural resources. The Kazakh government has resisted initiatives that would see gas and oil prices rise as a result of the shortage, and would like to avoid this possibility by increasing imports.

There are two principal causes for the Kazak fuel shortage, both of which are tied to the Russian economy. Due to current sanctions placed on Russia, the price of fuel in Russia, from which Kazakhstan imports a third of its energy, is much higher than it is in Kazakhstan and in other states throughout Central Asia. Exacerbating the crisis is the Kazakh Central Bank’s decision to devalue the Kazakh tenge back in February of this year.

The decision to raise prices was made as a result of the Russian ruble decreasing in value following large capital outflow and general economic uncertainty in Moscow due to its activities in Ukraine. The issue of gas prices, thus, can be traced to Kazakhstan’s overwhelming dependency on Russia, particularly as it pertains to its energy sector.

Follow us on Twitter: @SteppeDispatch

News Briefs

  • A UN Human Rights team that is investigating claims of torture in Azerbaijani prisons said it had to cut short its visits due to government stalling. The five-person group said that these actions had come despite assurances that the team would have unrestricted access to wherever prisoners were being held – they concluded they had to cut short the visit due to the compromise in integrity. Current president Ilham Aliyev is consistently accused by human rights campaigners of abuses.
  • Talks between Afghanistan’s rival presidential candidates have stalled once again, in a spate over the release of final election results that both say were rigged by the other party. Abdullah Abdullah does not want the results to remain as they now stand and desires more ballots to be invalidated to narrow Ghani’s margin of victory. Both candidates made promises earlier that they would abide by a UN commission that investigated the widespread fraud.
  • In Turkmenistan, the Ministry of Foreign Affairs held a meeting with the newly appointed ambassador of France, Patrick Pascal, who said he wished to note the importance of expanding cooperation between the two countries “in various directions,” according to the statement. This move could be a larger play by the EU to diversify its sources of oil and gas, which has been a consistent issue ever since European sanctions hit Russian companies. An undersea pipeline from Turkmenistan or an overland from Azerbaijan through Turkey would completely circumvent both Russia and Iran, currently geopolitical pariahs in the West.
Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s