Kazakhstan’s Role in Global Energy Security and Supply Chains

Global energy markets and supply chains are facing unprecedented challenges, including geopolitical tensions, supply disruptions, and the need to transition to cleaner energy sources. For decades, global energy has been heavily reliant on a few dominant suppliers. However, shifting geopolitical dynamics and the global push for diversification and sustainability are creating opportunities for new players to emerge. One country to consider is Kazakhstan. Given its strategic location and natural resources, it can play a role in stabilising and diversifying energy supplies. 

Kazakhstan’s Growing Role in Global Energy Markets

The world is increasingly seeking alternatives to traditional energy sources and suppliers due to a combination of factors, including the volatility of global oil markets, geopolitical conflicts, and the need to address climate change. Supply disruptions can have ripple effects across the global economy. As a result, many countries are diversifying their energy imports to reduce dependence on a limited number of suppliers and mitigate risks associated with political tensions or supply chain disruptions. Kazakhstan can fill this gap in secure and stable oil supplies. Following the launch of the Kazakhstan Export Blend Crude Oil (KEBCO), which entered into active trading in 2023, Kazakhstan produced just under 88 million tonnes of oil in 2024. Most of it was exported through the Caspian Pipeline Consortium (CPC), which carries oil from Kazakhstan to Europe. Last year, it transported approximately 64.4 million tonnes of oil, a slight increase from 63.5 million tonnes in 2023.

At the same time, Kazakhstan has been exploring alternative export routes to diversify its oil transportation. One such route is the Baku-Tbilisi-Ceyhan (BTC) pipeline, with Kazakhstan shipping approximately 1.2 million tonnes of oil through it in the first 10 months of 2024. The country is also increasing exports to Germany through the Atyrau-Samara route, which now transports 100,000 tonnes of oil monthly. 

This diversification is of geopolitical importance as it reduces Kazakhstan’s reliance on traditional transit routes that pass through Russia, mitigating risks associated with geopolitical tensions and ensuring a more stable and secure flow of energy to global markets. Essentially, developing new export routes ensures that the country’s energy supplies can reach Western markets securely. With 15 vessels in its maritime fleet and plans for further expansion, Kazakhstan is well-positioned to meet the growing energy demands of Europe and beyond.

Moving forward, it is important for Kazakhstan to continue to invest in both infrastructure and technology to ensure that its oil and gas resources can flow to global markets, no matter the external conditions.

Diversification Through Green Energy

While oil remains key to Kazakhstan’s economy, the country has been transitioning to cleaner energy sources, with the aim to reach carbon neutrality by 2060. This is driven by several factors, including the global push to combat climate change, the need to align with international environmental commitments such as the Paris Agreement, and the growing recognition of the economic and environmental risks posed by reliance on fossil fuels. Transitioning to cleaner energy also helps Kazakhstan diversify its energy mix, reducing its vulnerability to fluctuations in global oil prices, therefore enhancing long-term energy security.

Several projects have been launched to facilitate this transition. For instance, in July last year, KazMunayGas, Kazakhstan’s national oil and gas company, and Eni, an Italian energy company, began constructing the country’s first hybrid power plant, which will combine solar, wind, and gas energy for a total capacity of 247 megawatts. The plant is expected to be fully operational by 2026 and will provide stable energy to the region. Overall, the Kazakh Energy Ministry is targeting the introduction of at least 26 gigawatts of new capacity by 2035.

Speaking at the Abu Dhabi Sustainability Week Summit on January 14, Kazakhstan’s President, Kassym-Jomart Tokayev, emphasized that “it is very much important that international partners including Masdar, Total, Eni and others have pledged 43 Gigawatts of green energy projects in Kazakhstan.” He also pointed out that the construction of Kazakhstan’s first nuclear power plant – following a nationwide referendum – marks a significant step toward national sustainable energy development.

Beyond green power plants and nuclear energy, Kazakhstan is also exploring the potential of Sustainable Aviation Fuel (SAF). With the growing demand for cleaner aviation fuel, especially in Europe, the Central Asian country is looking to capitalise on its ethanol supplies. By producing SAF locally, Kazakhstan can meet its own needs and help international airlines comply with strict emissions standards set to take effect in 2027. This could potentially position Kazakhstan as a regional leader in the emerging SAF market, aligning with global decarbonisation efforts.

The country’s transition to green energy and sustainable development will be one of the key topics discussed at the Astana International Forum (AIF) in May. Hosted by  President, Tokayev, the event will welcome attendees from around the world, including heads of state and top business leaders. AIF will serve as a platform to discuss and identify viable ways to leverage Kazakhstan’s role as a contributor to global energy security. 

Kazakhstan’s Strategic Position in Global Supply Chains

With global supply chains facing stress from geopolitical events, Kazakhstan could provide a stable and strategic route for energy transportation between East and West. Its geographic location, combined with the expansion of routes like the Trans-Caspian International Transport Route (TITR), means that it can serve as a corridor linking energy supplies from Central Asia to Europe. The development of both overland and maritime transport infrastructure strengthens its ability to meet the needs of global markets efficiently. Such investments in expanding export routes ensure that global energy supplies remain stable, secure, and diversified.

However, the success of these efforts depends on addressing challenges such as the high cost of infrastructure development, potential political and logistical barriers along transit routes, and the need to harmonise regulations and customs procedures across multiple countries. 

If these issues don’t cause significant barriers, Kazakhstan will be well-positioned to contribute to global energy security and supply chain stability. Through its oil production and investments in green energy, Kazakhstan has the potential to become a reliable partner for Europe, the United States, and the broader global economy.