Kazakhstan doesn’t have any plans to cut its crude and condensate production in May, its energy ministry said on Thursday, as the OPEC+ producer continues to give the group headaches with continuously busting its quota in the deal.
Kazakhstan, one of the biggest overproducers under the agreement alongside OPEC’s second-largest producer, Iraq, plans to keep its crude oil and condensate production levels in May the same as in April and slightly higher than in March, Kazakhstan’s energy ministry told Bloomberg via email.
The second OPEC+ output hike in as many months signaled that Saudi Arabia will not tolerate any longer OPEC+ producers regularly busting their quotas while others, such as the Kingdom, stick to their production ceilings per the agreement. Iraq and Kazakhstan have been the OPEC+ members chronically pumping above their quotas, continuously promising to “compensate for previous overproduction,” and continuously failing to do so.
Kazakhstan’s combined crude oil and condensate production reached an all-time high in March, which further exceeded the country’s crude output ceiling under the OPEC+ deal.
Kazakhstan, a non-OPEC producer part of the OPEC+ pact, pumped a record high 2.17 million barrels per day (bpd) of crude oil plus condensate in March.
Under the OPEC+ agreement, Kazakhstan’s crude oil production quota is 1.468 million bpd. The deal doesn’t cover condensate production and has no limits on it.
Kazakhstan has been consistently overproducing above its OPEC+ limit and is one of the biggest overproducers alongside Iraq and Russia.
This year, the overproduction issue has become even greater after U.S. supermajor Chevron started up oil production at an expansion project at the largest oilfield in Kazakhstan that would boost crude oil output by 260,000 bpd.
Last week, Chevron’s CEO, Mike Wirth, told analysts at the Q1 earnings call that “On OPEC plus in Kazakhstan, you know, really were not discussions of that. We don’t engage in discussions about OPEC or OPEC plus.”
By Charles Kennedy for Oilprice.com
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