Kazakhstan missed chance to liberalize fuel prices, expert says
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Kazakhstan is already facing a fuel deficit, and the opportunity to profit from high demand in neighboring countries was missed years ago, oil and gas market expert Olzhas Baidildinov said. He argued that price controls have made the industry unattractive for investment, preventing the construction of new refineries.
Missed Opportunity
Baidildinov stated that after the modernization of Kazakhstan's refineries, he repeatedly advocated for fuel price liberalization. He warned as early as 2017 that controlled prices would lead to a deficit. According to him, earlier liberalization could have attracted private investors to build a fourth and fifth refinery, allowing Kazakhstan to capitalize on regional demand.
Regional Demand
Kyrgyzstan annually imports about 1.2 million tons of fuel from Russia, with similar volumes consumed by Tajikistan, while Uzbekistan also relies on external supplies. Baidildinov argued that Kazakhstan could have earned revenue from exports to Central Asia and Russia, benefiting refineries, the state budget, railways, and citizens. 'We slept through this moment,' he said.
Global Context
Baidildinov noted a global shortage of diesel fuel, which could affect harvest campaigns in several countries. Continued strikes on grain export infrastructure may further raise global agricultural prices. Meanwhile, Kazakhstan's Energy Ministry stated there is no fuel deficit, with reserves meeting norms, and proposed extending the ban on fuel exports for six months.
What's Next
The Energy Ministry has prepared a draft order to extend the ban on exporting gasoline, diesel, and certain oil products for another six months. It remains unclear whether the government will consider price liberalization to address structural deficits.
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Kazakhstan missed chance to liberalize fuel prices, expert says
