Kazakhstan to Stop Oil Flow Through the CPC

Kazakhstan suspended crude oil shipments to the Russian port of Novorossiysk via the Caspian Pipeline Consortium, sources told Bloomberg and the FT on July 21.The announcement came on the back of a number of attacks, which the CPC called “terrorist,” that disrupted the loading of tankers at the Black Sea port.The CPC officially suspended loading on July 20 and later said it had resumed operations.Now, sources told separately Bloomberg and the FT that the CPC could stop shipments via this route, following Ukrainian attacks on oil tankers engaged in the trade of Kazakh oil via the Black Sea marine terminal at Novorossiysk, through which around 80% of Kazakhstan’s oil exports transit.Drones hit two oil tankers carrying Kazakh oil on July 19.On July 17 another drone attack hit an empty tanker owned by Chevron, a major shareholder in CPC and Tengiz, one of the largest oil fields in Kazakhstan.The attacks prompted both the ministry of energy and the ministry of foreign affairs to issue strong statements in response. “We regard such attacks as an unacceptable infringement upon the economic interests of the Republic of Kazakhstan, as well as deliberate acts aimed at destabilizing lawful international trade and global energy markets and undermining the security of global transport and logistics supply chains,” the ministry of foreign affairs said.While Kazakhstan’s government did not name Ukraine as the perpetrator of the attacks, discontent towards the government in Kyiv is brewing.Tankers ASIA and NISSOS IOS, hit on July 19, had loaded oil from Kashagan and Karachaganak fields, which are operated by international consortia of Western, Russian, and Chinese oil companies.According to traders reached by the FT, tankers were refusing to call at the terminal, as they were too nervous to send their ships into the facility. A temporary halt to oil exports via the CPC could deliver a blow to Kazakhstan’s budget revenues and create bottlenecks in the supply chain to Europe, the major consumer of Kazakh oil.Previous attacks on the marine terminal prompted the US to seek diplomatic channels to ask Ukraine to stop targeting oil tankers and terminals in the Black Sea linked to American shipments.Yedige Yerkassynov contributed to the reporting.Sign up for our English-language newsletter.