For any country, including Uzbekistan, natural gas resources hold strategic importance, heavily influencing the nation’s economy, energy security, and foreign trade balance. Recent data indicates that 70-75% of electricity generation relies on natural gas. However, the ongoing reduction in natural gas extraction year after year could pose a serious threat to the country’s energy independence.
A 30% Decline in 13 Years
In recent years, natural gas extraction in Uzbekistan has been steadily decreasing. Specifically, between 2010 and 2023, this reduction amounted to nearly 30% or 19.2 billion cubic meters.
According to the Statistics Agency, the dynamics of natural gas extraction from 2010 to 2023 are as follows:
From a Gas Exporter to a Net Importer
Uzbekistan has long been a gas-exporting country. However, since 2020, gas exports have sharply declined.
In 2017, gas exports were valued at $1.39 billion, $2.42 billion in 2018, $2.26 billion in 2019, $478 million in 2020 (the pandemic year), $717 million in 2021, $911 million in 2022, and $530 million in 2023.
Between 2018 and 2023, gas exports decreased nearly 4.6 times in monetary terms.
It should be noted that the price at which Uzbek gas was sold abroad has never been disclosed and is classified as a “commercial secret.”
Uzbekistan’s gas was primarily exported to countries such as Russia, China, and Kyrgyzstan. In 2020, exports to Russia were halted, and the volume delivered to China began to decrease. Specifically, in the first seven months of this year, $323 million worth of gas was exported, 5.6% less than in the same period last year. Although gas exports have been shrinking due to shortages, they have not stopped. This is explained by the existence of a long-term contract for gas trade between Tashkent and Beijing.
Since last year, officials have started compensating for the shortfall in domestic extraction by importing gas from Turkmenistan and Russia. In August 2023, Tashkent and Ashgabat signed a short-term agreement to supply up to 2 billion cubic meters of gas annually. Starting from October, the process of delivering Russian gas to Uzbekistan via Kazakhstan began. Thus, after many years of irrational economic and energy policy, the gas-rich country has become dependent on other nations' gas. For instance, Uzbekistan imported $695 million worth of gas in 2023, and in the current year, this figure has reached $984 million, a fivefold increase compared to the same period last year.
