Kazakhstan bans Russian fuel imports in bid to buoy domestic producers

ALMATY -- Kazakhstan has temporarily banned the import of gasoline, diesel and aviation fuel from Russia to help prop up domestic producers as a state of emergency due to the coronavirus outbreak curtails demand.

The ban, which began Wednesday (April 1), is tentatively planned to last three months, according to local news portal Tengri News, citing the Kazakh Ministry of Energy.

The ministry said that the ban on the import of fuels and lubricants was introduced to support Kazakh producers, reported Almaty-based business publication Kursiv.

The use of petroleum products has decreased during an economic slowdown forced by the coronavirus pandemic, according to the report. Lower domestic demand and an influx of imported fuel will cause Kazakh oil refineries' output to fall, fear Kazakh authorities.

Kazakhstan, several times already, banned or restricted the import of Russian fuel by rail, once in August 2018 and again in February 2019. This measure was aimed at reducing surplus fuel on the Kazakh market.

Kazakh self-sufficiency

Kazakhstan has been able to fully cover domestic demand for fuel and lubricants since 2018 thanks to the modernisation of its oil refineries, which significantly increased capacity and, accordingly, production volumes.

Gasoline production in Kazakhstan has doubled since 2018, said Rakhim Oshakbayev of Nur-Sultan, director of the TALAP Centre for Applied Research.

Additionally, the country now produces gasoline that complies with Euro-4 and Euro-5 emission standards. European emission standards define the acceptable limits for exhaust emissions of vehicles sold in the European Union.

Last November, the Kazakh Ministry of Energy said that the country had begun exporting Euro-5 gasoline to Europe. This year there is a plan to expand the supply of automotive fuel to the markets of Central Asia.

"Kazakhstan is an oil-producing country, but even so we have always imported oil products from Russia," Tolegen Akhmetov, an economist and entrepreneur from Nur-Sultan, told Caravanserai in 2019.

Energy dependence on Russia has repeatedly turned into gasoline shortages in Kazakhstan, leading to negative impacts on the economy of the Central Asian republic.

The most recent occurred in the fall of 2017, when long lines of cars formed at gas stations throughout the country during a scarcity of fuel.