The evolution of global oil transportation corridors
Geopolitical events in recent years have reshaped—and continue to reshape—not only trade routes but also global energy markets. Consequently, the prospect of Russian oil supplies to Europe bypassing Ukraine has become increasingly relevant. A Kazinform News Agency correspondent has analyzed how such a shift might impact the raw material supply chain.
Oil transportation routes to Europe
Russia is one of the major suppliers of oil to European markets. Currently, there are several key logistical corridors for transporting oil to Europe.
The Druzhba pipeline has historically been a key route for transporting Russian oil to Europe via Ukraine, connecting oil fields with Central and Eastern Europe. The pipeline runs from Almetyevsk through Samara and Bryansk to Mozyr, where it splits into two branches: the northern branch, which passes through Belarus, Poland, Germany, Latvia, and Lithuania, and the southern branch, which passes through Ukraine, the Czech Republic, Slovakia, and Hungary.
In addition to the Druzhba pipeline, Russian oil is supplied to Europe through the Baltic Pipeline System (BPS). This system of trunk pipelines connects the oil fields of the Timan-Pechora, Western Siberian, and Ural-Volga regions with the seaport of Primorsk. From there, oil is delivered to Rotterdam, the main hub for oil trading and processing in Europe.
The Caspian Pipeline Consortium (CPC) connects oil fields in Western Kazakhstan (Tengiz, Karachaganak) with the Russian Black Sea coast (the Yuzhnaya Ozereyevka terminal near Novorossiysk). From there, including Kazakh oil, transportation continues via tankers through the Bosporus and Dardanelles.
Northern Route: Through the Baltic Sea, Russian oil is transported to European ports such as Primorsk and Ust-Luga for further shipment.
Southern Corridor: Routes in the Black Sea, including terminals in Novorossiysk, Kulevi, Supsa, Odessa, Constanța, Sulina, and Bursa, operate within the sea basin and provide access through the Bosporus Strait.
Middle Corridor or TITR: This route involves transshipment across the Caspian Sea to Baku, followed by rail or pipeline transit through Azerbaijan and further transportation via Georgia, Türkiye, or the Mediterranean.
Oil transportation costs to Europe
Pipeline transport costs are generally lower, around $2–$4 per barrel, depending on distance and infrastructure. In comparison, maritime transportation incurs higher expenses.
For instance, tanker shipments through the Baltic or Black Sea may cost $5–$10 per barrel, influenced by freight rates and insurance premiums.
Alternative routes under consideration include railway lines, such as the Middle Corridor (Trans-Caspian International Transport Route) and other rail options. However, these alternatives are significantly more expensive, costing between $10 and $15 per barrel due to multimodal transshipment.
Potential changes in logistics
If Russia is unable to use Ukrainian routes, the global oil logistics landscape could undergo significant changes.
Specifically, the existing Baku-Tbilisi-Ceyhan (BTC) pipeline could absorb part of the redirected volumes, although capacity constraints and pricing could pose challenges. Regarding the Bosporus and Dardanelles straits, increased tanker traffic through these routes could lead to congestion and environmental risks, necessitating stricter regulations.
Under these circumstances, the Middle Corridor takes on critical logistical importance. Increased investments in the Trans-Caspian route could make it viable, although substantial infrastructure upgrades would be required to handle large volumes.
Northern routes are also being considered as alternatives. Expanding Baltic Sea ports and increasing the ice-class tanker fleet could help boost capacity.
It is also worth noting that the emergence of several new routes provides guarantees for the partners involved in these projects. For example, European countries can diversify their suppliers, increasing their reliance on countries in the Middle East, the United States, and Africa.
Currently, Russia exports approximately 4.5 million barrels of oil per day to Europe. Analysts estimate that bypassing Ukraine could lead to the following:
- Northern and Baltic routes being able to absorb 1–2 million barrels per day;
- Black Sea and Bosporus routes handling 1 million barrels per day, limited by tanker availability and port capacity;
- The Middle Corridor providing an additional 500–700 thousand barrels per day, depending on infrastructure investments.
Economic implications
For Russia, the main advantage lies in reducing dependence on Ukrainian infrastructure and increasing the security of supply routes. However, higher logistical costs, increased reliance on expensive maritime routes, and a potential loss of market share due to Europe’s diversification efforts pose challenges.
For Azerbaijan, this situation promises increased transit revenues and strategic importance as a logistics hub. However, it may also strain existing infrastructure.
For Türkiye, this scenario has both pros and cons. The advantages include increased transit revenue through the Bosporus and investments in the Middle Corridor. The drawbacks involve environmental and safety risks due to increased tanker traffic.
For Kazakhstan, the Baku-Tbilisi-Ceyhan pipeline could become a key alternative, as the country plans to increase oil supplies through this route to 20 million tons per year.
The head of the Center for Oil Research, Ilham Shaban (Azerbaijan), believes that as a key player in the regional energy transport network, Azerbaijan could benefit from increased use of the Baku-Tbilisi-Ceyhan pipeline or other existing routes.
“This could lead to higher transit revenues and greater geopolitical significance in energy markets. Azerbaijan’s cooperation with Türkiye in facilitating alternative routes could also strengthen its regional alliances and stimulate economic growth. Türkiye stands to gain both economically and strategically. With its position as an energy transit hub further solidified, increased oil flow through Turkish ports and pipelines could result in significant transit fees. Additionally, Türkiye’s geopolitical influence in energy negotiations between Europe, the Caucasus, and the Middle East is likely to grow, enhancing its status as a regional power,” the analyst asserts.
According to the expert, countries consuming Russian oil could face mixed outcomes.
“Alternative routes may lead to slightly higher costs due to logistical complexities, which could result in a modest increase in oil prices. However, more stable supplies bypassing conflict zones contribute to energy security,” says Ilham Shaban.
Benefits and risks for Kazakhstan’s economy
In July 2022, after a one-month suspension of operations by the Caspian Pipeline Consortium (CPC), which connects Western Kazakhstan’s oil fields (Tengiz, Karachaganak) with Russia’s Black Sea coast (Yuzhnaya Ozereyevka terminal), Kazakhstan's President Kassym-Jomart Tokayev highlighted the importance of diversifying oil supply routes.
To this end, Kazakhstan began oil shipments through the Baku-Tbilisi-Ceyhan pipeline last year. “KazMunayGas” and the State Oil Company of Azerbaijan (SOCAR) signed an agreement to transport 1.5 million tons of Kazakh oil annually via this route. Exports started in April 2023.
Recently, Energy Minister Almasadam Satkaliyev announced that Kazakhstan plans to increase oil shipments through the Baku-Tbilisi-Ceyhan route from the current 1.5 million tons to 20 million tons per year. [Oil is transported by tankers across the Caspian Sea to Baku from Kazakhstan — editor’s note.] The minister also stated that Kazakhstan is continuing discussions on the possibility of oil deliveries via the Baku-Supsa route, estimated at 3 million tons per year.
According to oil and gas analyst Abzal Narymbetov, the Baku-Tbilisi-Ceyhan (BTC) pipeline is becoming a key alternative as it completely bypasses Russia. It has a high capacity of up to 60 million tons per year, though it is currently operating at less than half of its capacity.
“98% of our exports pass through Russia. If transit through these routes is suspended, Kazakhstan’s economy will face severe challenges. The country’s budget depends on oil and gas revenues by half, and 60% of export earnings come from oil sales. Developing the BTC route is a way to mitigate risks and protect the economy from potential shocks,” Abzal Narymbetov believes.
According to him, Azerbaijan’s oil production is declining while domestic consumption is increasing. This opens opportunities for Kazakhstan to utilize the freed-up capacity. Shipments through BTC would reduce dependence on Russian routes.
However, the analyst points out the high cost of BTC, as transporting oil through it is three times more expensive—approximately $120 per ton compared to $38 through the Caspian Pipeline Consortium (CPC). The main issue, in his opinion, is transporting oil by rail from the fields to Aktau and then delivering it by tankers across the Caspian Sea to Baku. This process is time-consuming and involves additional costs for storage and waiting. The expert also believes that expanding shipments to 20 million tons would require infrastructure upgrades.
Experts also note that the new route via Baku-Tbilisi-Ceyhan entails certain economic risks for Kazakhstan’s economy. Nevertheless, despite these risks, this route remains advantageous in the event of rising oil prices.
This year, Kazakhstan is exporting 68.8 million tons of oil, including 55.4 million tons via the Caspian Pipeline Consortium (CPC), which runs from the Atyrau region to Novorossiysk, 8.6 million tons via the Atyrau-Samara pipeline, 3.6 million tons across the Caspian Sea, and 1.1 million tons to China.
Experts emphasize that changes in transit routes will primarily affect the energy market. Countries such as Kazakhstan, Azerbaijan, and Türkiye could become critically important players in this segment.
