This POD got my wheels turning about the possibilities, but the part I cannot really get over is who to get Hitler to realize that Case Blue was not viable and the oil wasn't extractable from the Caucasus and that the Soviets were not yet ready to be pushed over, so multiple offensives was not possible. Perhaps if the Matzen oil field in Austria is discovered and Hitler and Goering actually listen about the logistics of getting oil out of the Caucasus and decide that a more restrained series of moves in 1942 is necessary because the Soviets aren't about to fall over? I don't know really how to get the necessary POD.
But if it were to happen things would be very different than IOTL and get very interesting as a result. The effects I mentioned earlier would still be at play, namely the fall of Leningrad and Murmansk in Summer 1942, freeing up around 500k Germans for other missions, eliminating over 1 million Soviet soldiers and capturing a ton of valuable turf and equipment/factories, shortening the front line dramatically, and cutting off 25% of Lend Lease. It would also force the Allies to travel much further to deliver equivalent amounts of LL to other ports (Persia, Vladivostok), while they weren't really set up to take that much more supplies even by early 1943 (especially Persia). Plus then the Soviets would have to rail it much further to get to the front, while the Germans would free up a lot of resources like the 5th Air Fleet and naval units for other missions.
Assuming the sequencing here is Operation Trappenjagd in May against Taman, 2nd Kharkov, Operation Störfang against Sevastopol, then Operations Wilhelm and Fredericus II to distract Soviet forces in Ukraine, while sending the 18th army additional divisions to create the conditions for Operation Nordlicht in July (i.e. not waiting for 11th army to be moved north), they could launch Operation Moorbrand in June to effectively crush the Soviet 54th army and free up more troops for the attack on Leningrad, while having Richthofen's 8th Air Corps moved north, while other divisions and artillery are moved in. So in July Leningrad could be taken by Manstein's command moved in for the mission, while then after that it would be possible to clear the West bank of the Volkhov river with freed up forces from Leningrad, while the Finns and German mountain and light divisions could move north to finish off Murmansk in August-September. In August the units freed up from Leningrad and not sent north could help with the widening of the Demyansk salient's supply lines, which would hurt the Soviet forces in the area quite a bit (I forget the names of the operations, one was launched IOTL and was really successful and badly messed up Soviet forces on the southern side of the salient for minimal German losses, while ITTL the northern side of the salient could be attacked too and open up a rail line into the salient as well as shorten the line and push Soviet artillery out of range of the supply lines), while units transferred in from Ukraine/Crimea could help launch Operation Whirlwind and pinch off part of Soviet forces near the base of the Rzhev salient and shorten lines there dramatically...the problem though is that was planned for right when the Soviets launched their Rzhev offensive that summer, which IOTL screwed up the planned offensive.
Soviet offensives for 1942 though would impact these German offensives though, especially in Rzhev. Without Case Blue they have reserves around Moscow to throw at Rzhev. After 2nd Kharkov and follow up German offensives in Ukraine they'd have neutered Soviet forces in the south, so that wouldn't be much of an issue for summer 1942...but Soviet reserves defending Moscow would be. Historically the Germans had a successful deception operation to keep Soviet reserves locked down around Moscow for Summer 1942, but ITTL they might launch their deception operation to convince the Soviets they were attacking in Ukraine; Stalin's paranoia about the loss of Moscow though might mean this isn't successful. Regardless the Soviets will at least have their 5th Tank army that was used around Voronezh in Summer 1942 for use against Rzhev ITTL (among other units), so they might put even more pressure on AG-Center to the point that some of these planned offensive operations the Germans had might not be viable because they will be engaged in heavy defensive fighting. Cutting off the Kalinin Front in the Toropets/Kholm salient would probably not be that viable until Autumn, but by then the weather makes that a risky proposition. I wonder how Operation Mars would play out without Operation Uranus? Perhaps there would be an offensive along the Volkhov river to recapture Leningrad over winter 1942-43? I'd imagine 3rd Kharkov happens in Winter 1943, if not sooner, but much stronger without having to advance from Stalingrad/the Don to get there. The Germans would be much stronger too, as they haven't budged in the Ukraine all year for the most part, so will have strong defensive lines and reserves, so I guess the Kursk bulge doesn't form.
I'm thinking that the Soviets will probably be as damaged at IOTL 1942, but in different areas, so it's a wash there, but the Axis forces will be much stronger and the Italians will have an entire army to withdraw from Russia to throw into Sicily come 1943 if needed, while Hungarian, Romanian, and other Axis allied armies will not be beaten up like IOTL, so will be an asset to help in the East, while the Germans still have an intact 6th army and 4th Panzer army to hold in Ukraine. Plus without the Luftwaffe getting so beaten up around Stalingrad, German supply lines being shorter and much more stable, and the lack of huge equipment losses the Germans experienced in their advance and retreat/defeat in the Caucasus and Stalingrad would mean they are pretty formidable in the field still come 1943, with tons more veterans, but with even better weapons in Summer 1943. Perhaps the focus for the German 1943 offensive is cleaning up the area around Rzhev to hold it better, like eliminating Kalinin Front and the salient between Rzhev and Demyansk if possible. For the Soviets they will still bash away at Rzhev and certainly in Ukraine. But without the encirclement losses of winter 1942-43, plus having a shorter front line and inflicting really heavy losses on the Soviets in 1942, the Eastern Front might well end up like a really big version of the 1943 Battle of Smolensk with the Soviets shoving the Germans back at extreme cost and no breakthroughs, just another defensive line to confront. The Eastern Front could get a lot bloodier and take a lot longer to deal with for the Soviets, which would be really bad news for them in the rest of the war, as they conscripted some 4 million men from the areas of the USSR the German occupied in 1943-44.
In the Mediterranean the Italian 8th army would be a problem for the Allies after they take Tunisia. Assuming that plays out as per OTL that would mean some 250k veteran, well equipped Italian troops show up in Spring/Summer 1943 to defend Sicily and Sardinia, when IOTL the Italians were down to a few poorly equipped garrison divisions that were left over after the best Italian troops were wiped out in the East and in Africa.
https://en.wikipedia.org/wiki/Italian_Army_in_Russia
Having 12 extra veteran divisions with captured Soviet military equipment, including T-34 tanks and 76mm AT/field guns would be FAR more formidable than anything the Italians had to defend themselves IOTL by Summer 1943. IOTL the Italian divisions in Sicily were estimated to be equivalent to 1/4th an Allied division because of how little of their TOE they had and how green the troops were. Here the Italian 8th army troops might well be equivalent to a full Allied division. Even with the weak German divisions left in the area after Tunisia, the FAR stronger Italian army would actually be a major problem for the Allies during any invasion. Already highly combat experienced, plus having mountain divisions that would be well suited to operations in Sicily, the Italian 8th army would be quite dangerous, despite all the jokes about Italian military prowess. So that could radically alter the situation in the Mediterranean compared to OTL, which then in turn makes the Germans quite a bit stronger in the East in 1943, as historically the fall of Sicily and invasion of Italy/defection of Italy ended up requiring the Germans to sent 9 motorized or Panzer divisions to Italy in 1943; if the Sicily invasion is either diverted to Sardinia, defeated on the beaches, or dragged out for a long time due to the Italian 8th army, then Summer 1943 in the East is much more favorable to the Germans than I allowed for above, thanks to saving a lot of divisions from having to fight in Italy proper, replace Italian troops all over the Mediterranean, and disarming the Italian military, while the Italians would be a huge help in the Mediterranean theater. It might end up being the iron gut and diverting Allied attention to France earlier.
Depending on butterflies WW2 might get longer and quite a bit bloodier with this POD...assuming you can find a way to make it happen.