Booming Russian Airlines Leave Kazakh Carrier Short of Jet FuelBy and
Air Astana says scarcity of supply is threatening operations
Low fuel prices, stronger economy have aided Russian airlines
Air Astana JSC, Kazakhstan’s flagship carrier, said a scarcity of jet fuel is threatening its operations in the Central Asian nation as Russian rivals suck up supplies.
“Regular air service in Kazakhstan is in jeopardy,” Air Astana said Monday in a statement, citing lower fuel deliveries from Russia. Four suppliers -- Gazprom Neft PJSC, Rosneft PJSC, Lukoil PJSC and Tatneft PJSC -- have sent an average of 15,000 tons a month this year, down from 44,000 tons in 2016, it said.
Russian airlines are booming as cheaper fuel and an economic recovery spur travel. Passenger volumes in August expanded more than 16 percent year-on-year and shares of No. 1 carrier Aeroflot PJSC rose to a record the previous month. But increased demand for fuel has had a knock-on effect on neighboring Kazakhstan, which relies on Russia for about 70 percent of its jet fuel, according to Air Astana.
Gazprom Neft has given notice that fuel exports won’t resume until next May, the Kazakh carrier said. The Russian company said it hasn’t broken any contract.
“The 2017 summer season has seen unprecedented and unpredictable growth” in the volume of air transport and jet-fuel consumption in Russia, Gazprom Neft said in an email. The St. Petersburg-based company has increased fuel production at its refineries to keep domestic supply uninterrupted, it said.
Rosneft said it’s in “full compliance with its contractual obligations,” according to a statement from the company, while Lukoil said deliveries to Kazakhstan have been carried out “within bounds agreed by the energy ministries of both countries.” Should there be available resources in the fourth quarter, Lukoil will consider jet-fuel deliveries to Kazakhstan, the company said in an email.
Scheduled repairs at Kazakhstan’s Shymkent refinery could worsen the “crisis,” Air Astana said, though Interfax reported that maintenance won’t affect jet-fuel units, citing Kazakh Deputy Energy Minister Aset Magauov.
Turkmenistan, Azerbaijan and Belarus also have insufficient jet-fuel supplies, according to the Air Astana statement.