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Kazakh Oil Exports to Germany Surge as Inpex Joins Druzhba Pipeline Network

By Vusala Abbasova June 1, 2024

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The Druzhba pipeline, one of the world’s longest oil pipelines, has played a pivotal role in Kazakhstan’s emergence as a key player in the European oil market.

Inpex North Caspian Sea, a Kazakhstani subsidiary of Japan’s Inpex, has started the first oil cargo shipment via the Druzhba pipeline to Germany, making it the second Kazakhstani company to use this route for European supplies.

The reports came from the Russian newspaper Vedomosti, citing sources familiar with Russia’s Energy Ministry statistics.

Inpex, which holds a 7.56 percent stake in the Kashagan oil field, dispatched approximately 20,000 tons of oil to Germany.

The Druzhba pipeline, one of the world’s longest oil pipelines, has played a pivotal role in Kazakhstan’s emergence as a key player in the European oil market. Following a transit agreement between KazTransOil and Russian oil transporter Transneft in December 2022, Kazakhstan began its oil shipments to Germany in February 2023. By the end of that year, the Karachaganak operator had delivered 933,000 tons of oil, falling short of the planned 1.2 million tons.

KazMunayGas has extended its contract for supplying oil to Germany through Druzhba until the end of 2024. From January to April this year, Kazakh oil exports to Germany via this pipeline reached 420,000 tons, a significant increase of 330,000 tons compared to the same period in 2023. For May, an additional 120,000 tons of Kazakh oil were scheduled for delivery.

Germany has refused to import Russian oil through the pipeline since early 2023 due to the EU embargo imposed after Russia’s invasion of Ukraine in February 2022. The EU implemented strict sanctions, including a two-thirds embargo on Russian oil supplies. The European leaders’ strategies to limit future imports include promoting conservation efforts, exploring alternative sources, and accelerating the transition to renewable energy such as wind and solar power.

As a result, Kazakhstan’s position as a reliable oil supplier is becoming increasingly vital for the EU. Amid this evolving landscape, Kazakhstan’s rich energy resources position it as a key player in meeting Europe’s oil demands.

Kazakhstan is the ninth-largest crude oil exporter globally. The country holds three percent of the world’s total oil reserves and is the third-largest oil producer in the Caspian region, after Russia and Iran.

With over 70 percent of its oil exports going to the European Union (EU), Kazakhstan is already the third-largest non-OPEC supplier to the bloc, which is considered one of the most prolific markets for energy exporters, given its lack of domestic resources.

Kazakhstan currently exports 67 million tons of oil annually to Europe through Russia, primarily via the Caspian Pipeline Consortium (CPC) to Novorossiysk, enabling access to global markets. Over two-thirds of Kazakhstan’s oil exports are transported through the CPC pipeline.