Kazakhstan’s potential gains from higher global oil prices are being severely constrained by a complex “logistics trap” and growing geopolitical risks, particularly its heavy reliance on export routes through Russian territory. As the world’s largest landlocked country, over 80% of Kazakhstan’s oil exports typically move via the Caspian Pipeline Consortium (CPC) system to a terminal near Novorossiysk, a route increasingly vulnerable to regional instability and attacks on infrastructure, according to The Times Of Central Asia.
Deep Reliance on Exports and the CPC
Kazakhstan’s economy is highly dependent on its energy sector, which accounted for 66.5% of total tax payments from the country’s 50 largest taxpayers in 2025, as reported by Qazinform. The nation is a predominantly export-oriented oil market, with approximately 81% of its oil shipped to foreign markets in 2025. The Caspian Pipeline Consortium (CPC) is the dominant export artery, growing from carrying 40% of the country’s oil exports in 2013 to approximately 82% by 2025, according to Energy Analytics data cited by Qazinform News Agency. In 2025 alone, 64.8 million tons of Kazakh oil moved through the CPC system. Major international energy companies, including affiliates of Chevron, ExxonMobil, Shell, and Eni, are shareholders in the CPC system and involved in Kazakhstan’s key oil projects.
Geopolitical Risks and Export Disruptions
Despite global oil prices exceeding $100 a barrel due to Middle East escalation, Kazakhstan struggles to fully capitalise on this. Attacks around Russian infrastructure are increasing risks to its main export route, exacerbating freight costs. The vulnerability of these routes became evident when shipments of Kazakh oil to Germany through the northern branch of the Druzhba pipeline halted on May 1. While some 260,000 tons planned for Germany were redirected to Ust-Luga and the CPC system, Ust-Luga also proved undependable, with shipments fluctuating amid attacks on Russian port and energy infrastructure.
A clear example of the impact was in July, when drone attacks on tankers at the CPC marine terminal near Novorossiysk repeatedly interrupted loading operations. This forced Kazakhstan to sharply reduce production, including at Tengiz, its largest oil field, because export capacity was constrained and storage facilities were filling. For Kazakhstan, such episodes are particularly damaging; without the ability to export, high global prices do not translate into higher revenue, and reduced production cuts tax receipts and contributions to the National Fund, The Times Of Central Asia reported.
Limited Capacity of Alternative Export Routes
While Kazakhstan has explored and increased volumes through alternative routes, these currently cannot replace the Black Sea system’s capacity. In 2025, 9.2 million tons of oil were sent via the Atyrau-Samara pipeline, and 1.1 million tons towards China through the Atasu-Alashankou pipeline. The Trans-Caspian route, shipping oil across the Caspian Sea towards the Baku-Tbilisi-Ceyhan pipeline, moved 1.26 million tons in 2025, with a plan to increase to 1.7 million tons in 2026. However, this route remains small and is constrained by port and tanker capacity, weather conditions, tariffs, and onward infrastructure.
To mitigate sanctions-related risks for exporters, Kazakhstan introduced the Kazakhstan Export Blend Crude Oil (KEBCO) brand in 2022 for oil exported through Russian ports, distinguishing it from Russia’s Urals grade.
Oil Production and Future Outlook
Kazakhstan’s oil production has seen significant growth, rising from 63.6 million metric tons in 2015 to a record 76.3 million tons in 2025, according to the Bureau of National Statistics. Qazinform reported that overall oil production reached approximately 99 million tons in 2025, up from 88 million tons a year prior. This increase was primarily driven by the expansion of the Tengiz field, which saw its production rise from around 28 million to 39 million tons in 2025. Other major fields, Kashagan and Karachaganak, produced about 18 million and 12 million tons respectively in the same year.
Future projections suggest Kazakhstan’s annual oil production could range between 90 million and 96 million tons after 2030, according to energy industry analyst Abzal Narymbetov. The Ministry of Energy, cited by IFX, projects oil output at 96 million tons in 2028. Narymbetov identifies further development of Kashagan as the main opportunity to push production beyond these levels, noting that Karachaganak has been at its ceiling for approximately 15 years.
