Russia's Fuel Crisis Paves Way for Iranian Oil in Central Asia

Central Asian countries have begun buying oil from Iran as Russian fuel supplies — a long-standing lifeline for the region — run dry amid Ukraine's escalating strikes aimed at crippling Moscow's war effort.

In August, Tajikistan announced it was receiving oil and petroleum products from Iran as Dushanbe faced uncertainty over supplies from Russia. Tehran also agreed to establish a joint refinery in Kyrgyzstan and to supply the country with crude oil.

Moscow is grappling with fuel shortages caused by Ukrainian drone strikes targeting refineries, while its war in the neighboring country continues.

Could Russia's fuel crisis open new opportunities for Iranian oil in Central Asia?

Which Central Asian countries are affected?

Ukraine's campaign against Russian energy infrastructure has alarmed Central Asian states such as Tajikistan and Kyrgyzstan, which depend on Moscow for oil and petroleum products.

Tajikistan traditionally imports up to 80 percent of its petroleum products from Russia. Kyrgyzstan also relies on imported petroleum products, with more than 90 percent of its gasoline coming from Russia.

"They are the most vulnerable countries," Galiya Ibragimova, a Central Asia expert at Berlin-based Carnegie Politika, told Al Jazeera in August.

Kyrgyzstan is a member of the Eurasian Economic Union, a five-nation free trade bloc of former Soviet states dominated by Russia. Tajikistan is not in the bloc but used to buy Russian fuel at preferential prices as "payment for political loyalty," according to Ibragimova.

Kazakhstan, meanwhile, has three large Soviet-era refineries, but domestic fuel prices have risen 15.6 percent this year. Uzbekistan is less dependent on Russian energy, with domestic output able to reach 100,000 tons of petroleum products a month, meeting most of its needs, but rising demand from neighbors has forced it to diversify imports and start talks with countries such as Georgia and Iraq.

Why is Russia facing a fuel crisis?

Russia is facing severe fuel shortages after Kyiv's drone strikes — designed to degrade its ability to sustain the invasion of Ukraine — knocked out an estimated one-quarter to one-half of the country's total refining capacity.

In response, Russia has imposed fuel rationing. Sales are typically limited to about 20–30 liters per vehicle, drivers must pump directly into their tanks, and most are barred from filling canisters. The government had already banned gasoline and aviation fuel exports; it is now weighing a ban on diesel exports too. Authorities have relaxed fuel quality rules, temporarily allowing lower-grade fuel onto the domestic market.

A state of emergency has also been declared in Crimea — the territory Russia annexed from Ukraine in 2014. A Russian-owned oil company in India, Nayara Energy, is reported to have sold petroleum products to Russia.

Russian President Vladimir Putin has acknowledged the crisis but shown little appetite for ending the war in Ukraine, insisting the situation is under control. "Strikes on our facilities certainly cause problems — that is clear. We are now seeing certain shortages, though I believe they are not yet critical," he said. "First of all, we must quickly and significantly increase production of the most needed air defense systems. We must also keep improving them... Repairs at refineries must be completed faster."

How is Iran helping Central Asia?

With Russia short on fuel, Central Asian states such as Tajikistan have begun signing deals with Iran.

In August, Tajikistan's Ministry of Energy and Water Resources told the Asia-Plus news agency that the country was receiving oil and petroleum products from Iran. The ministry did not disclose the shipping route, but Tajikistan expects to receive 2.55 million tons of oil and petroleum products from Iran.

Beyond Tajikistan, Iranian President Masoud Pezeshkian welcomed Kyrgyzstan's proposal to establish a joint refinery in the Central Asian country, according to Iran's Tasnim news agency. Under the agreement, Pezeshkian said: "The crude oil needed for the refinery can be supplied by Iran, and the products can be split between the two sides."

Will oil exports to Central Asia help Iran?

The US and Israeli war with Iran has hit Tehran's oil revenues. Data published by Iran's Statistical Center in September showed GDP fell 10.1 percent year-on-year in the period from March 21 to June 20, the first quarter of the Persian calendar.

Tehran's ability to sell crude has also been severely narrowed by a US naval blockade of Iranian ports, imposed for much of the war that began in late February. Iran's crude and condensate output fell from about 2 million barrels per day in March to roughly 740,000 bpd in July and just 220,000–255,000 bpd in August, according to estimates by Kpler and Vortexa.

TankerTrackers.com told Reuters in September that 29 tankers carrying 36.11 million barrels of crude were stranded in the Strait of Hormuz. Vortexa estimated that total Iranian crude at sea fell from 135 million barrels in late July to 107 million barrels in late August.

Faced with these challenges, Iran is scrambling to find new markets for its oil. According to analysts, Russia's fuel shortage has opened new opportunities for Iran in Central Asia, at least in the short term.

How does Iranian oil reach Tajikistan and Kyrgyzstan?

Iran shares no border with either country. To reach Tajikistan, "Iranian oil and refined products must transit Turkmenistan and Uzbekistan by rail," according to Frederic Schneider, a senior non-resident fellow at the Middle East Council on Global Affairs. To reach Kyrgyzstan, Iranian oil would also need to pass through Turkmenistan and Uzbekistan.

Is shipping oil with Iran logistically sustainable?

According to Schneider, that is unlikely. "This opportunity [for Iran] depends on Ukraine continuing to strike Russian refineries, which seems unlikely, both because of Ukraine's declining strike capacity and because the US government is asking for a halt to the attacks as they put too much pressure on the global oil market," he told Al Jazeera.

He noted that US President Donald Trump repeatedly pressed Ukrainian President Volodymyr Zelenskyy in September for an "energy truce" with Russia, as diesel prices became a political issue for Trump ahead of November midterm elections in the US.

"Those truces have so far collapsed within hours, but the direction is clear. When the strikes stop, or when Russia finishes repairing its refineries, Russian fuel will return to Central Asia duty-free under Eurasian Economic Union agreements, and Iran will struggle to compete on price," he said.

According to him, logistics also favor Russia for oil imports to countries such as Tajikistan and Kyrgyzstan, because Russia shares borders with both, unlike Iran. "Tajikistan's [oil] needs would require about 51,000 rail tank cars, and the country's main refinery at Dangara has never operated on a large commercial scale. Russia, meanwhile, has the logistics infrastructure, pipelines, rail routes and supply contracts for the region built up over decades," Schneider said.

Is Central Asia big enough to offset losses at Hormuz?

According to Schneider, the answer is no. Tajikistan's total demand is only about 50,000 bpd, tiny compared with the 1.7 million bpd Iran exported by sea a year ago. China reported two-way trade with Iran of $9.96 billion in 2025, not counting roughly $31.2 billion in Iranian oil, according to the US-China Economic and Security Review Commission.

"This shows Central Asia can be a useful outlet for Iran's diesel and gasoline, but it cannot replace the Chinese market," he said. For Tehran, the importance of Central Asia depends on the course of the US-Israeli war with Iran, and Tehran also needs to maintain good ties with Russia, a deep strategic partner.

"Iran cannot afford to be seen as poaching Russia's customers too aggressively, so it will present itself as a temporary supplier, which in turn limits the income it can earn from the region," Schneider said.

What other risks does Central Asia face?

Schneider warned that Central Asian countries could face US secondary sanctions related to Iran. "Legally, US secondary sanctions apply to any foreign company or bank conducting significant transactions in Iran's oil and gas sector, wherever they are, and the US Treasury expanded the list of sanctionable conduct in August. A Treasury official publicly warned that anyone engaging in these transactions 'does so at their own risk,'" he noted.

However, Schneider believes that politically, the US is unlikely to sanction Central Asian governments. "Central Asia is the arena of a new 'Great Game' between Russia, China and the US, and Washington is courting the region more strongly than at any time since the 1990s, mainly because of critical minerals. Kazakhstan alone holds about half of the minerals the US classifies as critical, including uranium and tungsten," he said.

"Sanctioning a Central Asian government for buying fuel from Iran would push them closer to Russia and China. What I expect instead are targeted measures against individual traders, rail and logistics operators, and smaller banks, combined with quiet pressure on correspondent banks in the region. That alone would be enough to raise costs and slow transactions, but the price is that these countries will step up efforts to decouple from the US economy and financial system," he concluded.