Kazakhstan suspends Russian fuel imports to avert surplus

Energy-rich Kazakhstan on Thursday suspended Russian fuel and gas imports to protect its domestic market from a surplus due to a weakened ruble which has sent ripples of economic uncertainty through Central Asia.

The energy ministry confirmed the ban, expected to last 45 days, had gone into effect after it was announced Monday by deputy minister Magzum Mirzagaliyev.

Sliding oil prices and western sanctions over its backing of rebels in eastern Ukraine caused Russia's currency to plunge to roughly half its value against the dollar in 2014, and the economic turmoil has had a knock-on effect in former Soviet nations whose economies are still tightly bound to Moscow.

The weakened ruble -- beneficial to Russian exports -- led to an increase of Russian fuel products in Kazakhstan in January and February, creating concerns about oversupply and limiting profits for local refineries, which typically meet up to two thirds of the country's fuel needs.

Russia is one of Kazakhstan's top trade partners and both are members of the Eurasian Economic Union, a regional free trade bloc driven by the Kremlin.

Eduard Poletaev, director of the World of Eurasia thinktank based in Kazakhstan said the fuel ban may be beneficial to both sides.

"Wholesale oil traders in Russia are finding it more profitable to go to Kazakhstan and sell there at the government price, so towns in Russia close to the border are also experiencing shortages," Poletaev told AFP.

Energy-rich Central Asian nations like Kazakhstan and Azerbaijan were already struggling to deal with falling oil prices when Russia's economic crisis led to a cheap goods flooding their markets, making it hard for domestic producers to compete.

Kazakhstan devalued its own currency, the tenge, by almost a fifth in February last year after an earlier dip by the ruble and several former Soviet nations have been forced to sharply devalue their currency this year as contagion from the weakened ruble spread.

The country's ban on Russian fuel products comes amid increased tensions between the neighbours.

Kazakh President Nursultan Nazarbayev said last year his country might leave the trade bloc if it did not meet his country's national interests.

Russian President Vladimir Putin then angered his neighbour by saying it had not existed as a country before the breakup of the Soviet Union.

In what observers saw as a response to his comments Kazakhstan, which has a significant ethnic Russian population, marked half a millennium of statehood this year.

Kazakh officials have also called for bans on a number of Russian food imports.

Nazarbayev on February 11 issued a call to citizens to support domestic producers in a "Made in Kazakhstan" campaign.

The 74-year-old, who has led the country since 1989, is expected to declare his candidacy for a snap April 26 presidential poll next week.