Kazakhstan Unrest... Crude Oil and Uranium Surge + Bitcoin Plummets

Crude Oil Rises 2% to $79.46... Uranium Price Surpasses $46
Bitcoin Drops 1.1% in One Day, Hits Lowest Level in 3 Months

Uranium Price Trends [Image Source= The Wall Street Journal]

[Asia Economy Reporter Park Byung-hee] As the unrest in Kazakhstan, a 'resource-rich country,' continues into its fifth day, uranium and crude oil prices have surged, while Bitcoin prices have plummeted. Kazakhstan is a member of the Organization of the Petroleum Exporting Countries Plus (OPEC+), the world's largest uranium producer, and the second-largest Bitcoin mining country. Concerns are emerging that if the Kazakhstan situation prolongs, it could become a stumbling block for the global economy.

The Wall Street Journal (WSJ) reported on the 6th (local time) that uranium prices surged after the unrest broke out in Kazakhstan on the 2nd (local time). Kazakhstan accounts for 40% of the world's uranium production.

WSJ cited local brokers, reporting that uranium prices exceeded $46 per pound that day. This is about a 10% increase compared to $42 per pound on the 3rd.

The protests, which began on the 2nd in Mangystau Province in western Kazakhstan in response to the government's removal of price caps leading to a surge in liquefied natural gas (LNG) prices, have spread nationwide. The Kazakhstan Ministry of Health stated that over 1,000 people have been injured in the violent protests as of that day, with 400 hospitalized and about 60 in critical condition. RIA Novosti reported that 13 security personnel died during the suppression of protests in the largest city, Almaty.

Locally, there are forecasts that the protests could hinder the movement of workers and equipment to mines, potentially restricting uranium exports.

The unrest in Kazakhstan has also affected crude oil prices. Kazakhstan is the largest oil producer in Central Asia, producing 1.7 million barrels per day as of November last year. According to the International Energy Agency (IEA), this accounts for about 2% of the world's daily demand.

On that day, February delivery West Texas Intermediate (WTI) crude oil futures on the New York Mercantile Exchange surged $1.61 (2.07%) from the previous day, closing at $79.46 per barrel. This marked the highest price since November 16 last year, with intraday prices briefly surpassing $80 per barrel. Oil prices rose for the fourth consecutive trading day. March Brent crude futures on the London ICE Futures Exchange also closed up 1.5% at $81.99 per barrel. Delays in oil supply due to repairs of Libya's oil pipelines also contributed to the price increase.

Bitcoin prices are sharply falling. According to CoinDesk, a global cryptocurrency specialist site, Bitcoin was trading at $43,180.75, down 1.10% from 24 hours earlier. This is the lowest level in about three months since early October last year when it recorded $43,798.70. Bitcoin has been declining for two consecutive days following a drop of over 5% the previous day.

According to MarketWatch, until the first half of last year, over 75% of total Bitcoin mining was conducted in China. However, due to the Chinese government's large-scale crackdown on mining farms, many mining operations moved to the United States and Kazakhstan. As of October last year, the U.S. accounted for 35% of mining, ranking first, while Kazakhstan accounted for 18%, ranking second.

Bitcoin trading volume has recently decreased due to the impact of the U.S.'s early tightening moves. According to CNBC, the average daily Bitcoin trading volume reached $138.2 billion in June last year but sharply dropped to about $35 billion last month. To make matters worse, the political instability in Kazakhstan led to internet shutdowns within the country and the suspension of operations at major banks and stock exchanges, paralyzing the economy and further dampening investor sentiment.

This content was produced with the assistance of AI translation services.