Declining oil refining activity in Russia and a renewed escalation of tensions between the United States and Iran are simultaneously increasing pressure on the regional fuel market. For Kazakhstan, these developments are particularly significant ahead of the harvest season and the scheduled maintenance shutdown of the Pavlodar Refinery.
In Russia, petroleum product output remains under pressure. Oil refining volumes in June were estimated at approximately 4.1 million barrels per day, while gasoline production was around 25% lower than a year earlier. A diesel shortage during the harvesting season could slow crop collection, increase operating costs for farmers, and negatively affect wheat quality.
For Kazakhstan, the impact is mixed. Higher oil prices support export revenues and strengthen the tenge. At the same time, higher diesel prices, potential reductions in fuel supplies from Russia, and rising fertilizer costs are likely to increase expenses for agricultural producers.
The key domestic risk will be the scheduled maintenance of the Pavlodar Refinery from September 18 to October 17, coinciding with the peak harvesting season in Kazakhstan's northern agricultural regions. The stability of the country's fuel balance will depend on accumulated diesel inventories, autumn fuel deliveries to farmers, and the actual volume of imports from Russia.
Meanwhile, fuel shortages are becoming a regional issue. Uzbekistan has significantly increased gasoline imports, while Kyrgyzstan sources more than 90% of its gasoline from Russia, making it one of the most vulnerable fuel markets in Central Asia.
For more details, please see our latest analytical report available via the link below.
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