At first glance, the US/Israel–Iran war was supposed to be an almost beneficial external shock for Kazakhstan. The country exports oil, global prices rose, Brent climbed above $100 and in late April reached $126 per barrel. In this logic, Kazakhstan should have received additional foreign currency inflows, support for the tenge, higher oil revenues, and a stronger budget position.
But the reality turned out to be more complex. Kazakhstan did not lose out directly because of the Strait of Hormuz, since Kazakh oil does not pass through the Strait of Hormuz. However, the country was unable to fully capitalize on the price windfall, because the main risk lay elsewhere — in its own export infrastructure.
The Gulf War showed an important lesson: a high resource price does not, by itself, guarantee a benefit. To realize that benefit, the resource has to be extracted, transported, sold, payments received, and the revenue passed through the budget system. In 2026, Kazakhstan’s problem arose not at the price level, but at the level of its physical ability to produce and export oil without disruptions.
Hormuz did not directly block a single barrel of Kazakhstan’s oil
The key fact is simple: Kazakh oil does not pass through the Strait of Hormuz. The country’s main export route is the Caspian Pipeline Consortium. It carries oil from fields in western Kazakhstan to the terminal near Novorossiysk, and then through the Black Sea and the Turkish Straits.
CPC accounts for more than 80% of Kazakhstan’s oil exports. The remaining volumes go through Atyrau–Samara, Baku–Tbilisi–Ceyhan, rail and sea routes across the Caspian, as well as to China. These are different routes, but none of them passes through the Persian Gulf.
Therefore, the closure of the Strait of Hormuz did not mean a direct halt to Kazakhstan’s exports. Unlike the Gulf states, Kazakhstan did not lose access to the global market because of the strait itself. On the contrary, the rise in Brent could have provided an additional premium. In some periods, CPC Blend even moved from a discount to Brent to a premium, as the market sought oil outside the blocked region.
But that was only the price side. On the physical side, Kazakhstan faced a different crisis.
The Real Blow: the Black Sea and Tengiz
While global markets were watching the Strait of Hormuz, Kazakhstan’s exports were being hit by the Black Sea. The CPC terminal near Novorossiysk is located in the zone of the Russia–Ukraine war. After attacks on the terminal’s infrastructure in late 2025 and the subsequent disruptions, the CPC operated under restrictions. For Kazakhstan, this was not background noise, but a direct blow to the country’s main export channel.
This was compounded by an accident at Tengiz, the country’s largest oil field. Tengiz accounts for a significant share of Kazakhstan’s output, and any technical constraints there quickly feed through to national indicators. In early 2026, the combination of problems at the CPC and at Tengiz led to a sharp decline in production and exports.
In the first quarter of 2026, Kazakhstan produced 19.7 million tons of oil and gas condensate — about 80% of the level recorded a year earlier. Oil exports amounted to 15.3 million tons — less than 79% of the same period in 2025. This was no longer a normal fluctuation, but a physical production-and-export shortfall.
The macroeconomy immediately felt the impact. GDP growth slowed from 6.5% at the end of 2025 to 3.7% over the first five months of 2026. The weakness in the oil sector was partly offset by services, transport, construction, and manufacturing. But the structure of the shock became clear: Kazakhstan was affected not by the closure of the Strait of Hormuz, but by the combination of high global prices with a decline in its own production and export capacity.
The war in the Middle East set the price. The war in the Black Sea took away the volume.
Price versus volume: why expensive oil did not save the day
The paradox of 2026 for Kazakhstan can be summed up in one formula: the price went up, but volumes declined. For an oil-based economy, this is fundamental. The budget, the balance of payments, corporate revenues, and the National Fund of Kazakhstan depend not only on Brent, but also on how much oil is actually produced, by which route it is exported, at what discount or premium it is sold, and who captures the margin.
A high price does not automatically translate into government revenue. In Kazakhstan, a significant share of oil revenues goes to the National Fund rather than directly to the republican budget. In addition, part of the extra margin remains with operators of major fields and participants in the export chain. For the budget, taxes, export duties, transfers, and revenue-sharing rules matter, not just the market price.
Therefore, even with expensive oil, the population and the budget might not have felt any rapid improvement. In the first quarter of 2026, the authorities explicitly explained that the National Fund was the main recipient of the windfall from the high oil price, while direct budget revenues were limited. But the National Fund itself was in a contradictory position. Revenues from the oil sector were growing not as strongly as the price might have suggested, while transfers continued to absorb a significant amount of resources.
This is how the fiscal cascade played out. First, production and exports decline. Then the potential flow of oil tax revenues falls. Then the budget compensates for the gap through transfers. As a result, a high oil price softens the blow, but does not cancel it out.
Alternative routes exist, but they do not replace the CPC
After the disruptions at the CPC, Kazakhstan began to use alternative routes more actively. Some of the oil was redirected via Baku–Tbilisi–Ceyhan. Shipments of individual batches of Kashagan oil directly to China via Atasu–Alashankou also emerged. The role of Aktau, the Caspian Sea, and the trans-Caspian direction increased.
But the crisis revealed an important difference between having a route and having a full-fledged replacement. Alternative routes do exist, but their capacity, cost, and technological constraints are not comparable to the role of the CPC.
Baku–Tbilisi–Ceyhan requires oil to be shipped across the Caspian, depends on the capacity of the port of Aktau, the tanker fleet, oil quality, and coordination with Azerbaijani infrastructure. The China route works, but it cannot quickly absorb the bulk of western Kazakhstan’s oil. Routes through the Russian system remain dependent on the same geopolitical zone where the Black Sea risks are concentrated.
The expert mistake here often looks like this: if there is a line on the map, then there is a route. But for crisis management, what matters is not a line on the map, but actual throughput capacity, cost, oil quality, insurance, port capacity, and the speed of rerouting flows.
The CPC turned out to be not just one of the routes. It turned out to be critical infrastructure that cannot be quickly replaced by a patchwork of small bypass routes.
Three wars around one country
To understand Kazakhstan’s position in the first half of 2026, one must look beyond the Strait of Hormuz. Kazakhstan is a landlocked country, and its vulnerability is determined not by a single strait, but by the entire system of access routes to global markets. In the first half of 2026, three zones of war and military-political risk emerged around the country at the same time.
West and north — the Black Sea and the CPC. This is the Russia-Ukraine war. It inflicted the most direct economic damage on Kazakhstan because it affected the country’s main oil export route. Formally, the CPC is an international consortium, but physically its marine terminal is located in the Russian zone of the Black Sea.
Southwest — the Caspian, Iran, and the North–South corridor. This is the US/Israel–Iran war. It did not directly block Kazakh oil, but it hit the southern logistics logic. Before the war, Kazakhstan and Iran were developing transport ties. Trade, rail freight, and cargo flows along the North–South corridor were growing between the two countries. The military crisis did not cancel this route, but it sharply increased its political and insurance risk.
South — Afghanistan and access to Pakistani ports. This is not a direct export channel today, but a bet on a future southern outlet to the Indian Ocean. Kazakhstan is involved in projects related to the Turgundi–Herat railway and the broader Trans-Afghan corridor. But the southern route remains a project possibility, not a working fallback in case CPC operations are halted. Any instability around Afghanistan and Pakistan makes this corridor a long-term, high-risk bet.
The east remains — China. This is the calmest direction in terms of military risks, but it also means greater dependence on a single route and a sharp increase in logistics costs.
The structural conclusion is straightforward: in 2026, Kazakhstan had no fully uncontested outlet to the west or south. The main question now is not whether alternative routes exist in principle. The question is which of them can withstand a shock in capacity, cost, and political resilience.
Southern corridors: risk and opportunity at the same time
The war involving Iran not only narrowed some options. It also showed why southern and Trans-Caspian routes are becoming strategically more important.
Before the crisis, Kazakhstan and Iran were expanding connectivity. In 2025, bilateral trade increased by more than a quarter, freight flows along the North–South corridor grew, and rail freight between Kazakhstan and Iran rose sharply. The two sides discussed upgrading infrastructure and increasing the corridor’s capacity.
Against this backdrop, the war created a dual effect. On the one hand, Iran became a riskier destination: insurance, sanctions, security, payments, and political predictability deteriorated. On the other hand, the entire region once again saw the value of alternative logistics. When maritime and pipeline hubs become vulnerable, overland corridors through Central Asia attract more attention.
The Middle Corridor also benefits from the search for alternatives to Russia, Iran, and maritime chokepoints. But here too, there is no simple solution. Growth in cargo flows runs up against the Caspian Sea, the ports of Aktau and Kuryk, ferry capacity, rail interoperability, tariffs, and coordination among several states.
For Kazakhstan, this means that the crisis did not cancel the diversification strategy; it made it more urgent. At the same time, it showed that diversification is not a declaration, but hard infrastructure work.
What the war revealed
For Kazakhstan, the Iran war was a “shot fired nearby.” It did not hit the country’s main oil export route, but it showed what would happen if the next shock struck Kazakhstan’s “straits”: the Black Sea, the Bosphorus, CPC, the Caspian, or southern transit hubs.
The main lesson is not that Kazakhstan failed to benefit from expensive oil. There was a benefit, but it was limited. The main lesson lies elsewhere: for a resource-rich landlocked country, resilience is determined not only by the price of the resource, but by the route, infrastructure, insurance, ports, oil quality, the tax structure, and the political reliability of transit countries.
In 2026, Kazakhstan faced not a single shock, but an overlap of several layers:
- the oil price rose;
- production and exports declined;
- The CPC proved vulnerable;
- alternative routes proved to have limited capacity;
- The National Fund and the budget did not receive automatic relief;
- southern corridors became more necessary, but also riskier;
- The eastern route remained workable, but it was not aligned with the previous direction.
Therefore, the practical conclusion is not to abandon the previous strategy, but to accelerate it and test it against real capacity. Kazakhstan needs not just new routes on the map, but routes that can be used in a crisis: with clear throughput capacity, economics, port infrastructure, insurance, and political guarantees.
The 2026 war did not destroy Kazakhstan’s economy. But it showed where its resilience is thin. The oil price can help, but only if the country is able to produce, transport, and monetize that oil. In this sense, Kazakhstan’s main risk turned out to lie not in the Strait of Hormuz, but in its own route geography.
The materials reflect interim findings as of June 17, 2026. The war is not over; the research continues.