Kazakhstan backs the OPEC+ group’s decision to reverse part of the production cuts, Kazakh President Kassym-Jomart Tokayev said on Friday.
“The president has emphasized Kazakhstan’s support for the decision by OPEC+ to gradually increase oil production volumes, prioritizing the protection of national interests,” Tokayev’s press service said in a statement, after the president met with OPEC Secretary General Haitham Al Ghais.
Non-OPEC producer Kazakhstan is part of the OPEC+ agreement, but it has been overproducing for years above its quota and hasn’t done enough to compensate for the overproduction yet.
OPEC+ producers including Kazakhstan are meeting on October 5 to decide production levels for November.
The alliance will consider reversing in November another 137,000 bpd of the combined 1.65 million bpd cuts that it will begin unwinding in October with a first batch of 137,000 bpd, sources with knowledge of the group’s plans told Bloomberg earlier this week.
Despite the production hike from OPEC+, oil prices have not collapsed, with Brent prices trading closer to $70 than to $65 per barrel in recent weeks. Part of this could be due to estimates that the group is not hiking oil production as much as the headline figures in the agreement suggest, as some members are close to capacity while others are compensating for previous overproduction.
Kazakhstan, however, has constantly busted its quota, although it continues to reiterate it is committed to the OPEC+ deals. Kazakhstan has raised production this year from expansion projects involving international majors such as Chevron.
Kazakhstan’s Energy Minister Yerlan Akkenzhenov said on Thursday that the country has raised its output since January, thanks to the Chevron-led expansion at the giant Tengiz field.
“At the moment, we cannot yet fit into those compensation schedules, but Kazakhstan is taking all possible efforts to comply with the OPEC+ agreement, and we remain committed to it,” Russian news agency Interfax quoted Akkenzhenov as saying.
By Michael Kern for Oilprice.com
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