Shortages - The Times Of Central Asia

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Fuel Exports

Central Asia Grapples with Fuel Shortages Amid Market Volatility

The heavy reliance on fuel imports from Russia is placing Central Asian countries in an increasingly precarious position. Disparities in pricing and exchange rates are driving a surge in illicit fuel resales, exacerbating supply challenges across the region. Gasoline and diesel prices continue to climb, and shortages are being felt widely. This dependence on Russian supplies is particularly concerning following U.S. President Donald Trump's ultimatum to Moscow: end the war in Ukraine within ten days or face 100% tariffs on countries trading oil and petroleum products with Russia. The tariffs could take effect as early as next week, placing Central Asian states in a hugely vulnerable position. Kazakhstan: Shortages and Shadow Exports In early July, motorists across Kazakhstan reported widespread shortages of AI-95 gasoline, particularly along the Karaganda-Balkhash and Astana-Pavlodar highways and in the country’s western regions. Some filling stations restricted purchases of AI-95 to 30 liters per vehicle, and AI-98 was only available via coupons. The Ministry of Energy attributed the shortages to increased tourist and transit traffic. Price caps on gasoline were lifted in January 2025, after which they began to steadily rise. According to the Ministry of Energy, fuel in Kazakhstan remains significantly cheaper than in other Eurasian Economic Union (EAEU) member states, prompting the government to gradually align prices with the regional market. Forecasts suggest gasoline prices could rise by up to 50%, further fueling inflation and impacting all sectors of the economy. The government argues that maintaining artificially low fuel prices would require substantial budget subsidies. The resulting price differentials have made illegal fuel exports more profitable, aggravating domestic shortages. To combat speculation, Kazakhstan imposed a ban in January on exporting gasoline and diesel by road and rail. Despite the country’s ongoing efforts to expand domestic production, Kazakhstan is expected to import substantial volumes from Russia in 2025: 285,000 tons of motor gasoline, 300,000 tons of jet fuel, 450,000 tons of diesel, and 500,000 tons of bitumen. Experts caution that significant increases in domestic output may not materialize until 2030. Russia’s decision on July 28 to tighten its gasoline export ban to include large producers is further complicating the situation. The embargo, introduced amid record-high exchange prices, is expected to last through August. Nevertheless, Energy Minister Erlan Akkenzhenov insists the Russian export restrictions will not affect Kazakhstan, citing a standing intergovernmental agreement that exempts the country from such measures. The Rise of Grey Market Schemes Despite official reassurances, fuel prices continue to rise. Energy expert Olzhas Baidildinov warns of a growing shadow market, driven in part by the weakening of the Kazakh tenge against the Russian ruble. With the exchange rate at 6.6 tenge per ruble, the economic incentive for illicit exports from Kazakhstan remains strong. Baidildinov predicts further shortages by the autumn if this trend continues. Kyrgyzstan: Growing Dependence Kyrgyzstan, which has faced repeated fuel shortages in recent years, has seen prices rise sharply. Over the past decade, the cost of AI-92 has climbed by 52%, AI-95 by 57%, and diesel, used in agriculture...

Industry Failures

Structural Barriers Continue to Hamper Industrial Growth in Tajikistan

Despite recent gains in industrial output, Tajikistan’s full industrial potential remains largely unrealized. Analysts point to a combination of systemic issues that continue to constrain the sector's sustainable development. Growth Driven by Extractive Industries According to the Statistical Agency under the President of Tajikistan, industrial production totaled 18.9 billion somoni in January, April 2025, marking a 25.2% increase compared to the same period in 2024. However, this growth was overwhelmingly fueled by the extractive sector, which surged by 90%. In contrast, manufacturing expanded by just 3.5%. While 121 new enterprises were launched during the first four months of the year, disruptions in existing operations and the narrow structure of industrial growth highlight deeper systemic problems. Idle Enterprises and Obsolete Equipment Minister of Industry and New Technologies Sherali Kabir reported that 92 industrial enterprises remained non-operational as of August 2024. Over half have been idle since 2008-2018, with the rest inactive since 2019-2022. The reasons range from financial difficulties and pandemic-related business closures to outdated equipment and low competitiveness. Rising input costs and limited market access further compound the problem. Some sectors, such as textiles and garments, could potentially resume operations, but only with significant modernization. Although some light and food industry enterprises have diversified, others, such as the porcelain factory in Tursunzade, have failed to adapt to changing market conditions. Raw Material Shortages Insufficient raw material supply remains a major bottleneck for several subsectors. The vegetable oil industry, for instance, requires approximately 833,000 tons of oilseeds to produce 100,000 tons of oil. However, domestic output is under 100,000 tons, limiting production to just 25,000 tons, four times below the national requirement. The canning industry faces similar constraints due to an inconsistent supply of fruits and vegetables. Energy Shortages Power outages continue to disrupt industrial output, especially in winter. Cotton processing plants produced 980 tons less fiber in the first half of 2025 compared to the same period in 2024 due to energy shortages. At the Azot plant in Levakant, production losses translated to a 7.3 million somoni revenue shortfall. Agricultural infrastructure has also been affected: the Land Reclamation Agency reported 130 pump station failures in 2023 alone, caused by voltage surges and sudden power cuts. Declining Cement and Coal Exports Despite advances in cement production, Tajikistan’s export volumes have declined sharply. From January to April 2025, the country exported just 154,000 tons of cement, down from 655,000 tons during the same period in 2024. This marks a 30.4 percent decline compared to the same period in 2023. The decline stems largely from reduced demand in key markets. Uzbekistan’s new cement plants have fulfilled domestic needs and displaced Tajik exports to Afghanistan. Coal exports have also suffered due to increased transit fees. Afghanistan raised its transit tariff from $7 to as much as $50 per ton, leading to a 15,000-ton decline in exports to Afghanistan and a 65,000-ton drop to Pakistan. High Production Costs Undermine Competitiveness High production costs across all sectors continue to undermine Tajikistan’s industrial competitiveness. For example, the...

Economy

Uzbekistan’s Gas Shortage Forces Residents to Use Coal, Firewood, and Dung

Despite Uzbekistan’s abundant natural gas reserves, many residents are turning to coal, firewood, and even dung for heating, leading to significant environmental problems, according to a report by Radio Azattyk. Experts warn of worsening air pollution and other ecological consequences, as highlighted by the International Energy Agency, while the government plans to expand coal use. Energy officials claim gas production exceeds domestic demand by threefold. However, production has been in decline for five consecutive years. Today, many households rely on coal and other alternatives for heating and cooking, while power plants that once operated on gas are transitioning to coal. According to the World Bank, in 2019, air pollution from fine particulate matter (PM2.5) led to 89 deaths per 100,000 people in Uzbekistan. Environmentalists argue that the increased reliance on coal accelerates climate change, while illegal tree cutting exacerbates ecological damage. Residents blame the government for failing to provide effective alternatives, a problem that worsens during the winter months. “In the city center, the gas pressure in the pipes is so low in winter that the stoves don’t warm. People are forced to burn coal, manure, and even fruit trees,” said Ferghana-based activist Abdusalom Ergashev. In response to widespread deforestation, the government has tightened regulations, with fines for illegal tree felling now reaching 17 million UZS (USD $1,300). Additionally, violators must plant 100 saplings for every tree cut down. In rural areas, families prepare for winter by collecting firewood, drying dung, and purchasing coal. The average household burns approximately 1.5 tons of coal per season, supplemented by cotton stalks, wood, and nut shells. Environmental consequences are becoming increasingly visible. In one video, popular blogger Akmal Isomiddinov highlighted the suffocating smog enveloping Ferghana, a phenomenon occurring across much of the country. Uzbekistan ranks among the leading nations in natural gas reserves, with an estimated 1.8 trillion cubic meters. However, its fields are depleting, and new developments require advanced technologies. Gas production in the first 10 months of 2024 totaled nearly 39 billion cubic meters, a 4.8% decline year-on-year. By comparison, production peaked at 61.6 billion cubic meters in 2018, dropping to 46.7 billion cubic meters in 2023. The government has set a goal to increase production by 33% and return to 2018 levels by 2030. Meanwhile, coal production continues to rise. From less than 4 million tons in 2016, output reached 6.5 million tons in 2023, with plans to increase production to 10 million tons by 2025. Thousands of schools, kindergartens, and hospitals were ordered to switch from gas to coal in 2023. Despite these challenges, the government asserts it is taking steps to combat climate change, including investing in green energy, providing subsidies for electric vehicles, and planting 200 million trees as part of a national campaign.

Oil and Gas

Turkmenistan’s Unexplained Shortage of Gasoline

For months now, areas in eastern Turkmenistan have been facing a severe gasoline shortage. The lack of fuel at the pumps is having a knock-on effect that is raising food prices and shutting down public transportation. Turkmen officials have not acknowledged there is any problem, so the people of the affected regions have no idea why this happening or for how long this situation will continue. Gasoline shortages are not new to Turkmenistan. They have been occurring sporadically in recent years, usually during in late summer when harvesting of crops starts. This latest deficit is unprecedented for Turkmenistan in its duration and severity. Long lines and purchase limits By late June, there reports from Lebap and Mary provinces about lines of cars of waiting at petrol stations. Often there was not enough gasoline for everyone. By mid-July, filling stations in at least five districts and several of the big cities in Lebap Province were often completely out of higher-grade gasoline – A92 and A95. Before the end of July, Lebap authorities imposed a 10-liter limit per customer, per day on gasoline purchases. At the start of July there were areas in the northeastern Dashoguz Province that were totally without gasoline, even the cheapest and most environmentally harmful A-80 grade (which is banned in many countries, including Kyrgyzstan and Tajikistan) was unavailable. In Mary Province, A-92 and A-95 gasoline ran out in July and by early August authorities had limited purchases of A-80 to 20 liters per customer, and even that was unavailable in many areas of the province. In October, Radio Free Europe’s Turkmen service, known locally as Azatlyk, posted a video of a line of vehicles some three kilometers long outside one of the few filling stations operating along the Turkmenabad-Mary highway. Azatlyk’s sources in the region said there were similar lines at filling stations throughout the province and in the provincial capital Turkmenabad. Some people are reportedly arriving at filling stations at 4am to get a place in line as close to the pumps as possible when the stations open. In Mary Province, some car owners said they were phoning family members to bring them food and water while they waited in line. Prices going up at the pumps and other areas Turkmenistan has some of the least expensive gasoline in the world with an average of $0.428 per liter, roughly a third of the world average of $1.30 per liter. The official rate of Turkmenistan’s national currency, the manat, is 3.5 to $1. The state regulated cost of one liter of gasoline is 1.15 manat for A-80, 1.35 for A-92, 1.5 for A-95, and 1 manat for diesel. There have been incidents where filling station employees have been illegally selling gasoline at 5-6 manat per liter to those who can afford it. The shortage is having an effect on public transportation. Most buses are assigned to bringing people to and from the cotton fields once harvest starts toward the end of August or early September...