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Unrest in Kazakhstan threatens oil and nuclear fuel supplies

Oil prices shoot up amid Kazakhstan turmoil

The deepening of the ongoing political turmoil in Kazakhstan has left several countries including China worried. The unrest has not only pushed global oil prices northward but fears of nuclear fuel shortages have also had an impact on uranium prices even as news reports suggested that mining activities at Kazatomprom, the world’s largest producer of the heavy metal, remained unaffected so far.

The mineral and energy rich Central Asian country supplies 40 per cent of the world’s uranium and is also a key exporter of oil. The country produces more than 1.6 million barrels of oil per day.

According to news agency Reuters, oil production at Kazakhstan's top field Tengiz was reduced on Thursday, as some contractors disrupted train lines in support of the ongoing protests taking place across the country.

The Brent oil price on Friday touched $82.23 a barrel. Barely a week ago, it was $78.98.

Foreign policy watchers told India Narrative that situation in Kazakhstan is an unfolding one and uncertainty is only rising as internet and telephone connections were suspended across much of the country on Thursday.

Also read: Facing large-scale unrest, Kazakhstan launches counter-terrorist operation with Russian backing

Beijing based news organization Global Times said that the protests in Kazakhstan have sparked concerns on oil and gas deliveries to China despite Chinese enterprises and industry insiders reiterating that the unrest was unlikely to have any significant bearing on transportation of oil and gas.

“The energy projects and normal operations of Chinese companies in Kazakhstan have so far been spared, but companies said they will be cautious and closely follow the situation after the country declared a two-week state of emergency on Wednesday,” the news organization said.

Not just China. India, which imports oil, uranium and titanium among other things from Kazakhstan, is also closely watching the developments.

“We need to understand that any kind of unrest in Kazakhstan will have a ripple effect in the region, so we need to carefully monitor the situation. The Central Asian countries like Turkmenistan, Uzbekistan and Kyrgystan among others are closely intertwined,” Subhomoy Bhattacharjee, Senior Adjunct Fellow at RIS (Research and Information System for Developing Countries) told India Narrative.