'Looming unrest in the oil sector' is rattling Central Asia's biggest country

Oil has been sliding again recently, hitting its lowest level in six years last week.

Kazakhstan, like many others, is feeling the pain as black gold dips lower and lower.

But that’s not the Central Asian’s country’s only problem: The government is also concerned about “looming unrest in the oil sector” that has followed lower oil, according to a new report by Stratfor.

Right now, the Kazakh government is thinking about changing labour codes, which would allow employers to dictate wages and employment more easily.

But energy unions are not pleased with this development — especially in an environment where drilling companies are already laying off hundreds of oil workers.

And Kazakhstan is worried about what the union workers could do.

“Astana’s biggest fear is social unrest,” Stratfor points out. “Kazakhstan has watched protests — caused by either outside intervention or internal issues — overturn governments repeatedly across the former Soviet Union during the past few decades. Kazakhstan has experienced sporadic protests and terrorist attacks, but what the government most wants to prevent is a repeat of the so-called Zhanaozen riots (also referred to as a massacre).”

Consequently, “Kazakh government is launching a series of negotiations with oil unions in the country’s western energy-producing regions amid the threat of protests,” with the hope of contain the situation, according to the report.

Notably, it’s not just the Kazakh government that’s worried about the country’s stability.

The post-Soviet state sits between Russia and Asia, which makes it an important player in both Moscow’s and Beijing’s strategic plans.

Aon top of that, Kazakhstan “is also one of the primary destinations for migrant Central Asian workers and thus contributes to other Central Asian states’ economies,” according to Stratfor.

So an unstable Kazakhstan could mean bad news for many of the countries around it.

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