Germany imports Kazakh oil using Russia's Transneft pipeline

KazTransOil (KTO) says it has delivered 20,000 mt of Kazakhstani oil via Russia’s Transneft pipeline to Germany.

PHOTO: The flags of KazTransOil, Kazakhstan and KazMunayGas. KazTransOil

This is the first consignment of a total of 1.2 million mt to be supplied in 2023.

Russian firms have faced heavy sanctions from the EU following Moscow's invasion of Ukraine. The sanctions are designed to restrict movement of Russia-owned or -operated vessels in international waters, and especially seaborne Russian crude and refined oil imports to curb Russian oil revenues. But non-Russian crude flows via pipelines remain exempt.

Germany has already stopped importing Russian crude oil following the sanctions, but has now started taking Kazakhistani oil running through Russia's state-owned pipeline.

It appears to be a win-win situation for landlocked Kazakhstan, an OPEC+ member, whose economy relies heavily on the oil and gas sector, and for Germany, which is shying away from Russian oil supplies.

According to reports, Russia is struggling to sell its refined products following the imposition of new EU sanctions on 5 February. The market is already stocked with Indian and Chinese refined products derived from Russian crude oil.

Russia has announced oil production cuts and continues to look for avenues to sustain its economy and continue the war.

“This transit of oil will be carried out within the framework of the relevant agreement between the Government of the Republic of Kazakhstan and the Government of the Russian Federation, dated June 7, 2002,” KTO said in its press release.

By Nitin Sharma

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