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Kazakhstan renames its oil to dissociate it from Russian oil and avoid Western sanctions

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“Due to recent significant geopolitical changes … and to avoid the negative effect of the changes on Kazakh oil exports through Russian ports, the name KEBCO (Kazakhstan Export Blend Crude Oil) will be applied from June 2022,” said the Kazakh oil producer. CNPC-Aktobemunaigaz, which delivers oil through Russian ports, in a written response to a request from Reuters.

Four sources in Kazakhstan’s oil companies involved in transit through Russian seaports also confirmed the renaming of the oil and added that the change to KEBCO will take effect on Monday for all official documents.

According to a source, the Ministry of Energy of Kazakhstan will request the government’s authorization for the official use of the new name.

The Ministry of Energy declined to comment.

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Russia’s export crude oil (REBCO) or Urals, Russia’s flagship crude oil loaded from the state’s western ports, has recently become difficult to place, especially for European buyers, due to Western and voluntary sanctions imposed by European companies.

Earlier this week, the EU announced an embargo on Russian oil imports from the end of 2022.

Kazakhstan uses Russian seaports as a transit route for 20% of its oil export flow, about 13.3 million tonnes in 2021, while oil originating in Kazakhstan is not technically subject to Western sanctions.

Transports from Kazakhstan have been repeatedly mistaken for Russian deliveries, traders said.

“It is a necessary measure so that our oil is not sanctioned, while its name clearly shows the country of origin in documents. Otherwise we have problems with the opening of letters of credit,” a trader involved in the transit of Kazakhstan’s oil through Russian ports told Reuters. .

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Kazakh oil producers hope they can get better prices for their oil and sell it more easily if documents make it clear that it does not come from Russia, sources said.

The difference between the price of oil in the Urals and that of Brent oil was more than $ 30 a barrel at the end of March.

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