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Kazakhstan to increase oil supplies via the Trans-Caspian route

DOWNSTREAM CENTRAL ASIA AND CASPIAN

Kazakhstan to increase oil supplies via the Trans-Caspian route

The ambitious move comes on the heels of transporting 1 million tons of oil along the Trans-Caspian route in 2023, with projections aiming for a boost to 1.5 million tons in 2024. President Kassym-Jomart Tokayev of Kazakhstan had previously directed an augmentation in oil transportation via the Trans-Caspian corridor in 2022, leading to a strategic agreement between KazMunayGas and the State Oil Company of Azerbaijan (SOCAR). This agreement outlines the annual shipment of 1.5 million tons of raw materials from the Tengiz field to Baku, facilitating subsequent transportation through the Baku-Tbilisi-Ceyhan oil pipeline.

Source: turan

The Trans-Caspian International Transport Route (TMTM), colloquially known as the "Middle Corridor," stands as a pivotal multimodal transport artery linking China and Europe. In light of the heightened tensions arising from the conflict between Russia and Ukraine, the corridor has garnered increased attention for its role in fostering economic stability and serving as a contingency route amidst geopolitical uncertainties.

The intricate journey of the TMTM begins with rail connections from China to Kazakhstan, traversing the Dostyk or Khorgos/Altynkol routes. It then progresses through Kazakhstan via rail to the port of Aktau before navigating the Caspian Sea to reach the port of Baku/Alat. Continuing its course, the route spans Azerbaijan and Georgia by rail, offering two further options for the final leg to Europe: either by rail through Turkey or by sea through the Black Sea.

The present global scenario has sparked a surge in interest in the TMTM as a transcontinental trade route, hailed for its potential to bolster economic resilience and serve as an alternate pathway adaptable to geopolitical instabilities. From a trade and economic perspective, the TMTM is recognized for diversifying trade routes and enhancing transport accessibility for Azerbaijan, Georgia, and Kazakhstan, according to the World Bank's "Medium Trade and Transport Corridor" study.

World Bank analysts assert that with improved operational efficiency, the Middle Corridor could witness a tripling of traffic through the Caspian Sea by 2030, reaching an estimated 11 million tons, up from 2021 levels. Notably, about 4 million tons of this traffic is anticipated to stem from the burgeoning demand for container transportation. The TMTM holds the potential to accommodate up to 10 million tons of cargo annually along its route, with container transport accounting for a significant portion of this logistical capacity, reaching up to 200 thousand tons.

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