Kazakhstan and OPEC+ to Boost Oil Production in June
OPEC+ Members Convene to Assess Market Conditions and Adjust Production
ASTANA – The eight OPEC+ nations—Algeria, Iraq, Kazakhstan, Kuwait, Oman, Russia, Saudi Arabia, and the UAE—held a virtual meeting on May 3, 2023, to examine the global oil market’s current conditions and outlook, as reported by OPEC.
During the meeting, the group highlighted the positive market fundamentals, citing low oil inventories as a significant indicator. Following earlier decisions made in December 2024 regarding the gradual reintroduction of voluntary adjustments amounting to 2.2 million barrels per day, the eight countries announced a production reduction of 411,000 barrels per day, beginning in June.
This targeted adjustment reflects a desire to ensure oil market stability while allowing flexibility to respond to changing market dynamics. OPEC emphasized that potential increases in production may be deferred or reversed if necessary, ensuring that member nations can swiftly adapt to evolving conditions.
According to OPEC’s findings, Kazakhstan is poised to increase its oil output to 1.5 million barrels per day in June, in line with the new production targets. The eight participating nations will convene monthly to reassess market conditions, adherence to quotas, and compensation measures, with the next meeting scheduled for June 1 to discuss production levels for July.
On the same day, the Stankevicius Group—a global market research and government relations firm—released findings aimed at countering criticism directed at Kazakhstan regarding its compliance with the OPEC+ agreement. The report underscored that Kazakhstan’s oil production accounts for nearly 5% of the OPEC+ total and less than 2% of global output. Thus, any minor deviations by Kazakhstan have little impact on overall market prices.
The report also emphasized Kazakhstan’s right to protect its national interests, highlighting that production cutbacks often disproportionately burden smaller producers while larger exporters manage to exploit loopholes. Notable examples cited include the UAE, Russia, and Iraq, who have reportedly breached their quotas without facing significant public scrutiny.
Furthermore, the analysis pointed out the repercussions of Saudi Arabia’s aggressive increase in oil production, suggesting that it may inadvertently undermine the OPEC+ agreement and contribute to price declines.
In conclusion, Kazakhstan aims to balance its national interests with the larger collective goals of the OPEC+ group, even as it advocates for a reevaluation of current quotas amidst ongoing tensions in the oil market.
