Russia’s Deputy Prime Minister Alexander Novak announced on Friday that the OPEC+ group has agreed to increase oil production starting April. However, he indicated this decision could be reversed if market conditions were to become unbalanced. During a simultaneous online briefing, Kazakh officials, who have often exceeded their production quotas, committed to reducing their output in March, April, and May.
Novak also mentioned that Russia produced less oil in February than its OPEC+ quota. Recently, eight members of the OPEC+ group held a virtual meeting where they confirmed the planned production increase of 138,000 barrels per day, marking the first increase since 2022. Novak stressed that while the group will proceed with the April increase, it remains open to reconsidering their approach if market imbalances arise.
His remarks resulted in a rise of over $1 per barrel in global oil prices. Industry sources revealed that Kazakhstan’s record oil output played a significant role in influencing OPEC+’s recent decision. The nation has been producing significantly above its quota, with major contributions from U.S. oil giant Chevron, which continues to expand production at the Tengiz oil field.
Kazakhstan’s Energy Minister Almassadam Satkaliyev acknowledged that the country has been producing above its quota but assured that measures are being taken to lower output. His deputy, Alibek Zhamauov, confirmed that production would be reduced in the coming months, and exports through the Caspian Pipeline Consortium (CPC) would also decline. Kazakhstan’s OPEC+ quota is set at 1.468 million barrels per day, while February’s crude and gas condensate output reached a record-high of 2.12 million bpd.
Recent reports of damage to the CPC pipeline due to a drone strike have raised uncertainties regarding export levels. Nonetheless, Zhamauov stated that while repairs are ongoing, exports would decrease in March, though he did not specify if the reduction was linked to the drone strike or planned output cuts.