Russia, which has some of the world’s major energy resources, aimed to use energy as an effective tool in foreign policy in the post-Cold War period and to become one of the most influential states in the world in this regard. In this context, various agreements were signed with European states and various projects were realized. However, strained Russian-Ukrainian relations and Moscow’s sometimes harsh rhetoric have given the United States of America (USA) an important pressure toolAs it is known, while Nord Stream 2, which was launched in 2015, strengthened the energy ties between Germany and Russia, the pipeline has been subjected to various sanctions by the US since 2019.[1]
With the escalation of the process in Ukraine, the Washington administration, which wants to influence Europe, has toughened its stance. Russia followed a similar policy and used the energy card. In this period, Moscow’s aim was to create an important crack in the Atlantic and to enable Europe to act more independently from the US. However, Russia’s expectations did not materialize and with the Russia-Ukraine War, Europe preferred the United States.
While Europe’s preference led to the search for alternative energy sources, Moscow accelerated its energy-centered policies. First of all, the Kremlin administration turned to the Asian market instead of Europe. It increased its energy exports to countries like China and added an energy dimension to its relations with countries like India. On the other hand, in order to control the energy market, it started to sell its energy resources below market prices and deepened its relations with energy exporting countries. In particular, it proposed the establishment of a “trilateral gas union” to the Central Asian states of Kazakhstan and Uzbekistan. Russia tried to improve its relations with these states when they did not respond positively to this proposal. However, for a certain period, there were also developments that would negatively affect Russia’s energy leverage.
During this process, relations between Astana and Moscow were strained due to Russian comments on Kazakhstan’s territorial integrity and the suspension of the Caspian Pipeline Consortium/Caspian Pipeline Consortium (CPC) by Russia. However, Russia, which has been subjected to Western sanctions, has suffered significant economic damage and needs Kazakhstan to reach Asia, has had to change its rhetoric and policies at this point. In addition, Kazakhstan’s strengthening of its relations with Azerbaijan on the Caspian Sea and its continued export of energy to the world market through various routes has increased Kazakhstan’s costs, but has significantly reduced Russia’s losses.
In the context of the developments, Russia’s first step was to restart the activities of the CPC. In the second step, Russia approved the transfer of oil from Kazakhstan to Germany via the Druzhba Pipeline and an increase in the volume. This led to the normalization of strained relations between the parties, and the lose-lose equation between the parties was reshaped into a win-win one.
In addition to Druzhba and CPC, there have been other important developments in energy-related developments between Kazakhstan and Russia. For example, in April 2023, the volume of Kazakh oil exports to Germany increased by 150% to a total of 50,000 tons. In this context, the amount of oil planned to be exported from Kazakhstan to Germany using Russian pipelines in 2023 is 1.2 million tons.[2]
On the other hand, the national company KazMunayGas said in a statement that Kazakhstan transferred 16.3 million tons of oil in the first quarter of 2023. This is an increase of 3.5% compared to the first quarter of 2022.[3]
As a response, Kazakhstan announced the extension of the agreement to transport Russian oil to China. The pipeline operator Kaztransoil announced on May 15, 2023 that the agreement to transport Russian oil to China was extended until January 1, 2034.[4] The continuation of this agreement has created an important balancing factor between Kazakhstan and Russia with respect to Germany and China. Kazakhstan has shown that they need each other geographically to reach Germany and Russia to reach China.
Another significant development was a proposal made by Kazakhstan. Astana has proposed to Moscow and Beijing to build a new international gas pipeline from Russia to China through the territory of Kazakhstan. The details of this proposal are unclear. However, as far as it is known, the line will pass through the eastern part of Kazakhstan.[5]
According to recent announcements, Kazakhstan and Russia have agreed on the route of the line to China. On May 16, 2023, Kazakhstan’s Energy Minister Almasadam Satkaliyev announced that the route has been determined and the conditions for the construction of the pipeline are being negotiated. With the construction of the pipeline, Russia gains the opportunity to export energy to China in a more secure way, while trying to compensate for its loss in the European market. Kazakhstan, on the other hand, will have the opportunity to deliver the energy needed by the central, northern and eastern regions.[6]
Russia today is significantly geopolitically dependent on Kazakhstan. Indeed, Moscow needs Astana’s leadership both to go south and export energy to Central Asia and to maintain exports to China via Kazakhstan until the Power of Siberia-2 is realized. In order to balance Kazakhstan, Russia has given it access to Germany. Astana’s increasing use of alternative routes since the Russian-Ukrainian War can be seen as a significant achievement. Through this process, Kazakhstan has seized an important potential to maximize its interests. The deepening of energy-based relations between the two sides is closely linked to Moscow’s interest in Asian markets, particularly China. The strengthening of energy and geopolitics-based relations between the two sides will prevent another lose-lose situation.
[1] Martin Russell, “The Nord Stream 2 Pipeline”, European Parliamentary Research Service, https://www.europarl.europa.eu/RegData/etudes/BRIE/2021/690705/EPRS_BRI(2021)690705_EN.pdf, (Date of Accession: 23.05.2023).
[2] “Kazakhstan’s Oil Exports to Germany Increase by 150% in April”, The Astana Times, https://astanatimes.com/2023/05/kazakhstans-oil-exports-to-germany-increase-by-150-in-april/, (Date of Accession: 23.05.2023).
[3] Asmar Bayramova, “Oil Transshipment via Caspian Pipeline Consortium Increases”, Trend News Agency, https://en.trend.az/casia/kazakhstan/3751278.html, (Date of Accession: 23.05.2023).
[4] “Kazakhstan Extends Deal to Transit Russian Oil to China”, S&P Global, https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/oil/051623-kazakhstan-extends-deal-to-transit-russian-oil-to-china, (Date of Accession: 23.05.2023).
[5] Nuray Alekberli-Museyibova, “Kazakhstan Proposes Gas Pipeline Project Connecting Russia and China”, The Jamestown Foundation, https://jamestown.org/program/kazakhstan-proposes-gas-pipeline-project-connecting-russia-and-china/, (Date of Accession: 23.05.2023).
[6] “Kazakhstan, Russia Map Out Gas Pipeline to China”, Reuters, https://www.reuters.com/markets/commodities/kazakhstan-russia-map-out-gas-pipeline-china-2023-05-16/, (Date of Accession: 23.05.2023).
