Kazakhstan pledges to cut its oil output until July of this year

Kazakhstan has extended its voluntary reduction of oil production by 82,000 barrels per day into the second quarter of this year, according to the Ministry of Energy.

«Kazakhstan is going to extend its voluntary reduction of oil production by 82,000 barrels per day into the second quarter of 2024 in coordination with other member states of OPEC+. This means that Kazakhstan will be producing 1.468 million barrels per day until the end of June. In the future, the country will gradually bring back its oil production following the market conjuncture,» the agency said in a statement.

This voluntary reduction of oil output is a supplement to a voluntary reduction of oil production by 78,000 barrels per day Kazakhstan announced in April 2023. It is going to last until December 2024. The voluntary reduction is aimed at facilitating efforts by OPEC+ member states to support the stability of oil markets.

According to Bloomberg, citing representatives of the oil cartel’s member states, OPEC+ agreed to extend the reduction of oil production by 2 million barrels per day until the end of June. People familiar with the matter also confirmed to the news agency that Saudi Arabia would continue to limit its oil production at the rate of 1 million barrels per day.

In January 2024, the combined OPEC+ reduction of oil output was less than 2 million barrels per day because Iran and Kazakhstan exported several hundred thousand barrels of oil more than they were supposed to export under their quotas. As a result, both countries have pledged to strengthen their compliance with rules and offset the overproduction.

In January, Kazakhstan exceeded its oil production quota set under its voluntary obligation within OPEC+. As a result, the country plans to compensate for this overproduction by May through a reduction in its current oil output, the energy ministry said. The agency didn’t provide any details about the oil output in January.

«Despite overproduction of oil in January 2024, Kazakhstan will offset this within the following four months and will continue complying with its obligations related to oil production confirmed at the 35th ministerial meeting of OPEC+ on June 4, 2023, its voluntary obligations arranged in April 2023 by OPEC member states and non-members and arrangements adopted in November 2023 for February and March 2024,» the ministry said in a statement.

On November 30, 2023, Kazakhstan and other OPEC+ member states agreed to voluntarily cut their oil production starting from January 2024 to keep the global oil market stable and balanced. According to Kazakhstan’s Ministry of Energy, the country will cut its daily oil production by 82,000 barrels from January 1 to March 31, 2024.

«Like other OPEC+ member states Kazakhstan has voluntarily cut its oil production by 82,000 barrels per day starting from January 1, 2024, until the end of March. As a result, Kazakhstan will be producing 1.468 million barrels per day until the end of March 2024,» the Ministry of Energy said.

From May to December 2023, Kazakhstan voluntarily cut its oil output by 78,000 barrels as OPEC+ members agreed to reduce their oil production to keep oil prices high.

As of November 2023, Kazakhstan produced 1.53 million barrels per day, according to S&P Global Commodity Insights, citing data from Platts. At the time, Kazakhstan’s quota for oil production within OPEC+ was 1.55 million barrels per day. In December, the country produced 1.56 million barrels compared to the same quota of 1.55 million barrels.