Kazakhstan’s President Nursultan Nazarbayev on recent hike of prices for petrol

Kazakhstan’s President Nursultan Nazarbayev on his working trip to Akmolinsk oblast commented on the recent hike of prices for petrol, a Tengrinews.kz journalist reports.

 “30% of [the most commonly used] AI-92-95 petrol has been imported from the neighboring Russia. If the Government hadn’t decided to stop regulating prices for these types of petrol, we would face shortages of petrol in a month’s time”, Head of State said.

“These are mere economics laws: we have to keep prices equal to those of Russia as we have no customs barriers and the movement of goods across the border is free. So we have to accept the decision (…)», he said, adding that “if someone has been able to purchase a vehicle worth $100 000, let him have sufficient petrol to buy”.

September 4, 2015 Kazakhstan decided to stop regulating prices for petrol. “Having studied all possible options and discussed the issue with market players, we decided there should be a flexible pricing model given the ongoing volatility at the FX market (…) The Government has decided to stop regulating prices for AI-92 and AI-93 petrol, two most common affordable types of petrol”, Vice PM Sagintayev told a briefing the same day.

 The price ceiling had been set by the Energy Ministry back in mid-May.

August 20 the country’s Government and the Central Bank renounced the currency band policy, opting for the free floating of the tenge. The same day the national currency weakened by 26% in one day, reaching 257 tenge for USD 1. Now the exchange rate varies between 240 and 245 tenge for USD 1.

August 20 the country’s President Nursultan Nazarbayev said that the measures to maintain the set tenge exchange rate in 2014-2015 had cost a total of $28 billion, with $10 billion spent in 2015.

Oil production in Kazakhstan in 2014 stood at 73.7 million tons. Three Kazakhstan-based oil refineries [in Shymkent, Pavlodar and Atyrau] produced a total of 3.02 million tons of petrol.