The EU's proposed price cap on Russian oil, which came into effect on December 5, has already caused a lot of uncertainty in the global energy market. And Central Asia, which is heavily dependent on Russia's pipeline infrastructure, could also face serious consequences.
Since the oil price cap makes the Russian export route even less attractive, it could lead to a further increase in Kazakh oil exports through Azerbaijan, said Philip Lausberg, a political analyst at the European Policy Center, Trend reports.
He also noted that there would probably be less Russian oil on the market, which could lead to a decrease in world oil supplies and higher prices.
"Kazakhstan, as the main oil producer in Central Asia, will benefit from these higher prices if it manages to export its oil around Russia. Since September, it has also been exporting part of its oil via Azerbaijani pipelines," the expert said.
Kazakhstan traditionally exports its oil via a pipeline to the Russian port of Novorossiysk, and thus capping oil prices is likely to have a negative impact on the country's oil production and revenues, the expert said.
“The EU embargo on Russian oil will increase European demand for oil from other countries. Virtually all other oil-producing countries are likely to benefit from increased European demand for their crude oil and possibly higher prices. This includes oil exporters from the Middle East , Africa and Latin America, as well as Azerbaijan," added Lausberg.
CentralasianLIGHT.org
December 27, 2022