Russia, Kazakhstan prolongs oil supply agreement

Russia and Kazakhstan have signed a protocol extending and amending the intergovernmental agreement on trade and economic cooperation regarding the supply of oil and petroleum products to Kazakhstan, originally signed on December 9, 2010.

According to a statement from the Kremlin's press service, the document was signed during a meeting between Presidents Vladimir Putin and Kassym-Jomart Tokayev in Kazakhstan, Caliber.Az reports, citing Russian media. 

In their joint statement following the talks, the leaders highlighted the stable operation of the Caspian Pipeline Consortium (CPC), which plays a key role in ensuring energy security and stability in the region, as well as in the development of economic cooperation between the two countries.

"The parties expressed interest in further expanding cooperation in the gas sector, including for the purpose of transporting gas to third countries," the document stated.

The parties emphasized the need to ensure the security of critical transboundary energy infrastructure to maintain the stability and reliability of resource supplies. They also specifically noted the role of natural gas as a vital transitional fuel in the implementation of fair, phased, and balanced energy transitions.

Notably, Kazakhstan has been increasing its cooperation with Russia on oil transport due to challenges related to the geopolitical and logistical viability of its other export routes. Kazakhstan's oil exports traditionally rely heavily on the Caspian Pipeline Consortium (CPC) route, which historically handles about 80% of its oil exports. However, the CPC's role has been affected by geopolitical tensions and issues at the Novorossiysk terminal, pushing Kazakhstan to seek alternatives.

In November 2023, Kazakhstan's President Tokayev announced plans to further enhance the transport of Russian oil and gas, aiming to leverage Kazakhstan's transit potential. This includes an expansion of the Atyrau-Samara pipeline, which is currently operating at 70% capacity, with potential to increase its throughput significantly. This pipeline is a key route for both Kazakh and Russian oil, linking to European markets via the Druzhba system.

By Khagan Isayev