On the 9th local time, the Office of the President of Kazakhstan stated that some of the country’s “strategic facilities” are being protected. However, the situation in Kazakhstan has caused fluctuations in the prices of a variety of commodities, including crude oil.
Riots in Kazakhstan cause price fluctuations in various commodities
Kazakhstan is a very important link in the global supply chain and has become a very important transportation hub in Central Asia in recent years. In addition, it is an export-oriented economy that also occupies an important position in world trade, especially in energy and some key strategic resources. Kazakhstan is the second largest non-OPEC crude oil producer in the OPEC+ group. According to the International Energy Agency, the country’s average daily oil production in November last year was about 1.7 million barrels. Its economic growth is also highly dependent on the export of crude oil, natural gas and related products, accounting for 73% of exports. In addition, ferrous metals, copper, aluminum, core and uranium are also Kazakhstan’s main export products. Among them, uranium production accounts for about 40% of the world.
In addition, in 2021, Kazakhstan has become the second largest Bitcoin mining center in the world after the United States, with its computing power accounting for 18% of the world. Therefore, the recent turmoil has brought obvious fluctuations to these markets.
Analysts: Kazakhstan’s production activities still face uncertainty
Due to concerns about supply uncertainty, international oil prices overall closed higher in last week’s trading, while the already high uranium price fluctuated further. According to Reuters, Kazakhstan’s presidential office said on Sunday that Kazakhstan Some of Stan’s “strategic facilities” are being protected by joint peacekeeping forces led by Russia. Although this has helped alleviate panic in the market, industry experts are worried that some production activities may still face uncertainty.
William Freebarian, Senior Editor-in-Chief, S&P Global Platts: The statement from Kazakhstan’s State Atomic Energy Corporation said that there are no problems with production now, but they also noted in the same statement that this may allow them to obtain some raw materials. capacity is limited, and these raw materials are very important to maintain production.
High inflation poses serious challenges to emerging market countries
One of the triggers for the unrest in Kazakhstan this time was the rise in domestic natural gas prices. This further highlights the severe challenges posed by the high inflation environment during the epidemic to emerging market countries. Kazakhstan’s inflation rate is running at a high level in the past five years, and in order to curb inflation, the Central Bank of Kazakhstan has also raised interest rates.
Kazakhstan National Chamber of Entrepreneurs: The riots caused losses of more than 1.3 billion yuan
On January 10, local time, the National Chamber of Entrepreneurs of Kazakhstan announced that according to preliminary estimates, the riots caused losses to Kazakhstan enterprises of approximately 93.7 billion tenge (approximately 1.38 billion yuan), of which Almaty The loss was 92.2 billion tenge.
The news pointed out that 1,319 commercial entities and facilities from 10 regions of Kazakhstan were impacted and affected, of which 1,234 commercial entities and facilities were affected in Almaty. Of the 1,319 business entities and facilities, 1,245 are from the trade industry, 25 from the public catering industry, 37 from the financial sector, as well as 9 logistics companies and 2 mass media companies.
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