Kazakhstan to significantly decrease oil production within OPEC+

Oil&Gas Materials 13 April 2020 15:52 (UTC +04:00)
Kazakhstan to significantly decrease oil production within OPEC+

BAKU, Azerbaijan, Apr.13

By Nargiz Sadikhova - Trend:

Kazakhstan will significantly decrease oil production within the framework of the outcomes agreed upon as a part of OPEC+ agreement, Trend reports with reference to Kazakhstan’s Ministry of Energy.

The extraordinary meeting of OPEC+ ministers was held on Apr. 12, 2020, following which the agreement to reduce oil production by 9.7 million barrels a day was signed for the period of two months starting from May 1, 2020.

“This undoubtedly is the greatest collective decrease of oil production in the history of oil industry. Kazakhstan, in its turn, has supported the consensus in the agreement having taken the liability to decrease oil production by 390,000 barrels a day,” the ministry said.

The ministry noted that such a decision was made due to first and foremost difficult situation both on oil market and in the world.

“Thanks to the OPEC+ agreement the decrease in oil production will be collective, controlled and will give positive impulse to the market, which some experts think will greatly affect growth of oil prices, and will solve the problem of oversupply,” the ministry said.

The ministry said that its currently in the process of developing scenario for oil production decrease.

On the morning of March 9, 2020, Brent crude plunged 25 percent dropping to its lowest since February 2016 and recording the biggest one-day percentage declines since Jan. 17, 1991.

Trading volumes in the front-month hit record highs in the previous session after a three-year pact between Saudi Arabia and Russia and other major oil producers to limit supply fell apart on March 6, 2020.

At the end of 2018, OPEC and a number of non-affiliated countries (Kazakhstan being one of them) decided to extend the agreement on reducing oil production, which has been in force since the beginning of 2017. The countries agreed to reduce their production by a total of 1.2 million barrels per day from the level of October 2018.

The latest liabilities of Kazakhstan within the agreement were 1.843 million barrels a day.


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