Stock Groups

Massive protests in Kazakhstan spur Russian involvement

[ad_1]

Kazakh law enforcement officers can be seen at a barricade in protest against the fuel price rise in Almaty (Kazakhstan), January 5, 2022.

Reuters| Reuters

In just two days protests against rising fuel prices turned into unrest in Kazakhstan. The country is a key energy producer, and has been a symbol for stability between the Soviet countries.

Maximilian Hess, an expert in Central Asia and a fellow at the Foreign Policy Research Institute on Thursday, said that “I have never seen anything similar to this in Kazakhstan.” “It is absolutely extraordinary.”

Kazakh media reports that dozens of protesters have been shot dead. According to Kazakh media, demonstrators set fires at government buildings in Almaty, setting it ablaze. They also took control of Almaty airport by night’s end. On social media, videos show demonstrators fighting hundreds of security personnel in riot gear as well as crowds taking down Nursultan Nasarbayev, a former President and long-standing strongman.

Kazakh police officers blocked a street in protest against fuel price rises in Almaty (Kazakhstan), January 5, 2022.

Reuters| Reuters

Nazarbayev, who stepped down from the presidency in 2019 but still holds significant power, was removed on Wednesday from his position as head of the country’s powerful Security Council by the current Kazakh president — his hand-picked successor, Kassym-Jomart Tokayev. The protesters have not been stopped by the resignation of Kazakhstan’s entire Cabinet.

Tokayev requested help from Russia after the internet was suspended. Russia responded with forces from the Collective Security Treaty Organization (a Moscow-led alliance of ex-Soviet states), on Jan. 5. Russian paratroopers have now rolled into the countryMany people associate this phrase with the Soviet era in Kazakhstan.

This is how it all began.

After the government of Kazakhstan announced that it would remove price restrictions on liquified petroleum gasoline, which most Kazakhs use to power their cars, unrest ensued. The market dictating LPG price meant most Kazakhs had to pay nearly twice for gas in the New Year. It was most evident in Kazakhstan’s western Mangystau Province, where, despite having a high standard of living, there is little to no oil or gas. Average monthly salaries are only a few hundred dollars, while price rises in basic amenities like gas can be very painful.

Kazakhstan is a nation of almost 20 million people, four times larger than Texas, and has been the largest oil producer in the OPEC+ alliance. It was also the country with the highest number of ex-Soviet countries. Upon taking up the presidency in 2019, Tokayev pledged political and economic reforms — but critics and country analysts say that has been slow to come.

A protest against the fuel price rise in Almaty (Kazakhstan), January 5, 2022 saw demonstrators ride on a truck.

Reuters| Reuters

Protests over LPG price control are taking a more political turn, and reports suggest that there is a demand for democratic reforms.

“The protesters’ slogans went well beyond objecting to recent loosening of price controls for transport fuel to challenging the country’s leadership,” said Nick Coleman, a senior editor for oil news at S&P Global Platts who spent several years living in Kazakhstan. In that respect, the concerns are no different to those expressed in many other ex-Soviet states over the years.”

The Kazakh authorities have no problem with this. Tokayev had already charged the protesters with being involved in a plot against foreign terrorists and has promised to “as tough a possible” when faced by the demonstrations. Some Russian state media have accused the West as being behind the unrest.

Kazakhstan: A giant in energy and commodities

Kazakhstan, Central Asia’s top producer of oil, has 12th-largest proved crude oil reserves. According to International Energy Agency. The world’s fifth largest crude oil reserve is located offshore at Kashagan, Caspian Sea. In 2018, Kazakhstan was the world’s ninth-largest coal producer.

Kazakhstan was one the top 10 fastest-growing countries in 2015 and has seen its per capita GDP increase sixfold in just six years. This is due to increased investment in oil, gas and coal sectors. Some of the world’s most important companies include Chevron, ExxonMobil ShellChevron is the largest private oil company in Kazakhstan.

KazMunayGas Exploration Production JSC, Kazakhstan, Jan 21, 2016: Workers at an Oil Well.

Reuters| Reuters

Kazakhstan also has some important infrastructure. These include gas pipelines that run from Central Asia to China. But while there have been solidarity strikes at some of the oil fields, including the massive Tengiz site — one of the world’s deepest operating supergiant oil fields in which Chevron has a large stake — there is so far no indication of those being disrupted, analysts say.

Matt Orr, Eurasia analyst at risk intelligence firm RANE said that U.S. companies might be most affected if Kazakhstan loses its energy production.

2019 was a year in which the U.S.’s oil producers were responsible for approximately 30% of the oil extracted in KazakhstanOrr noted that the figure is only 3% lower than what was produced by Russia’s Lukoil and 17% by Chinese companies.

Orr said that while the strike or protests by oil workers “may not prove to be necessary for maintaining production”, it was unclear how production could continue unaffected despite the possibility of additional workers striking. “Especially if they drag on past next week.”

[ad_2]