The War in Iran Opens a Window of Opportunity for Kazakhstan’s Oil Sector, Analysts Say

Analysts at brokerage firm Teniz Capital have outlined how the new Middle East war — sparked by U.S. and Israeli strikes on Iran — could affect Kazakhstan and its economy. Excerpts from the review were published by the Kazakhstan Association of Minority Shareholders (QAMS). As expected, the oil market is at the centre of attention, Orda.kz reports.

The analysts highlight the strategic importance of the Strait of Hormuz for global logistics, especially oil transportation. It accounts for about a third of global crude shipments and roughly 90% of oil transported from the region, mainly by Persian Gulf producers. Over the weekend, Iranian authorities announced the strait would be closed. Tehran had warned for more than a year that it could take such a step in the event of an attack.

However, the government reversed that decision shortly afterwards. Even so, shipping through the Strait of Hormuz remains risky, with reports that several civilian vessels have been hit.

Teniz Capital says that if the conflict drags on, Brent could rise to $90 per barrel. In the first days of the war, May Brent futures briefly surged to $82.40 — the highest level since autumn 2023 — before giving back some of the gains. At the time of publication, they were trading around $78.60.

The note also emphasizes that a blockade would damage Iran’s own exports. Although years of sanctions have sharply limited foreign trade — including energy exports — Iran still ships around 1.6 million barrels per day overseas, just under half of its total output. The analysts contend that the war turns supply risks from a short-term concern into a structural one.

They say that Kazakhstan could benefit from the situation, as its role as an alternative oil supplier would grow. China could be the biggest buyer of Kazakh oil, given that it traditionally purchases large volumes from the Middle East. Companies based outside the conflict zone, such as KazMunayGas (KMG) and KazTransOil (KTO), could also benefit. Increased investor interest could make it easier for them to raise capital.

Teniz Capital also outlines the potential advantages for KMG and KTO in greater detail. KMG could benefit if OPEC+ decides to accelerate production increases. Participants have already agreed to raise output by 206,000 barrels per day (Kazakhstan’s quota increased by 10,000 barrels to 1.58 million), but analysts say this would still be insufficient to offset losses tied to the disruption of passage through the Strait of Hormuz. Teniz Capital argues that higher prices combined with higher production would boost KMG’s investment appeal.

For KTO, global supply tightness and rising transit volumes could support earnings. This year, the company plans to gradually raise tariffs for its services, which would improve margins. One option for China could be to increase the transit of Russian oil through Kazakhstan to 12.5 million tonnes per year — a proposal currently under discussion. Teniz Capital believes that these factors could lead to faster growth in KazTransOil’s share price.

At the time of publication, KMG shares on the Kazakhstan Stock Exchange (KASE) were trading at 28,633 tenge, up 10% from the end of last week. KTO shares rose by 5.5%, reaching 1,100 tenge per share.

On 1 March, economist Almas Chukin discussed how the war in the Middle East could affect the global economy and Kazakhstan. If power in Iran shifts to a democratic, pro-American government, sanctions could be lifted, which he believes would give Kazakhstan additional access to the sea and 'a fairly rich, educated neighbour with great potential'.

Original author: Alexey Afonsky 

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