Rising oil prices: what it means for Kazakhstan’s economy

Global oil prices have once again climbed above $100 per barrel. Amid volatility in the energy market, the cost of crude has risen sharply, which could affect Kazakhstan’s revenues and the overall state of the economy.

Oil prices move back above $100

According to trading data as of 07:50 Astana time, the price of May futures for Brent crude on the London ICE exchange rose by 14.57 percent, surpassing $100 per barrel. At the same time, April futures for WTI crude increased by 14.06 percent to $95.18 per barrel.

This continues the sharp fluctuations seen in recent days. On March 9, global oil prices exceeded $100 per barrel for the first time since 2022, with Brent briefly rising to $116–119. By March 10, the market had started to correct, and prices dropped below $95. In a short period, oil has therefore experienced both a rapid surge and a noticeable pullback, highlighting how sensitive the market remains to external factors.

How higher oil prices affect Kazakhstan’s economy

Higher oil prices can have a positive impact on Kazakhstan’s public finances. More expensive crude increases export revenues, improves the trade balance, and supports the tenge. Additional funds may also flow into the National Fund.

At the same time, high volatility in the oil market creates risks for the economy. Price swings can affect inflation, investment activity, and financial markets. Kazakhstan’s reliance on oil revenues makes its economy sensitive to sudden changes in global prices.

In Kazakhstan’s 2026–2028 budget, the oil price assumption is set at $60 per barrel, with the exchange rate at 540 tenge per dollar. These parameters are used to calculate export revenues and plan government spending.

Minister: market volatility makes precise forecasts difficult

Energy Minister Yerlan Akkenzhenov said potential additional revenues depend on when the oil price is fixed during sales.

“If tankers are loaded now or were loaded recently, Kazakhstan will naturally see positive dynamics in both price and revenue. But if the price is fixed 20–30 days later, this effect may not appear, because there are specific rules for setting the price of oil around the delivery date,” the minister said.

According to him, it is currently impossible to determine the exact amount of additional revenue.

“There is no specific figure for profit. Oil is a commodity traded on exchanges, and its price changes every second,” Akkenzhenov explained.

The minister also noted that the oil market remains unstable.

“Every morning we see price changes: the peak was $119 per barrel, and now it has dropped to around $87. Therefore, there are conditions for prices to be around $80,” he said.

According to Akkenzhenov, predicting future price movements is difficult.

“I’m not taking on the role of a forecaster here — it’s impossible to predict. We see in the news that this is already affecting gasoline prices in the Persian Gulf countries and in the United States. In Kazakhstan — it is not,” the minister concluded.