BAKU, Azerbaijan, January 22
By Sadraddin Aghjayev – Trend:
S&P Global Rating projects oil production in Azerbaijan to moderately rebound to 0.77 million barrels per day (mbpd) in 2022, Trend reports citing the agency.
Azerbaijan's economy depends significantly on the hydrocarbon sector, which is currently benefiting from favorable global oil prices. Oil and gas constitute almost 90 percent of exports and amount to 50 percent of Azerbaijan's GDP, said the agency's report.
“Azerbaijan is one of the oldest oil producers in the world, and where industrial oil production started in the 19th century. Existing oilfields are ageing and exhibit a continued decline in production. Between 2010 and 2021, for instance, oil production dropped by close to 30 percent from over 1 mbpd to an estimated 0.74 mbpd,” the agency said.
S&P said Azerbaijan has been producing at about 10 percent below its OPEC+ quotas for the past few months, highlighting the production constraints at its oil fields as well as maintenance taking place at the main ACG oilfield.
“Nevertheless, as OPEC+ oil production cuts continue to moderate, we project oil production in Azerbaijan to moderately rebound to 0.77 mbpd in 2022, although over the medium term we forecast oil production declining toward 0.75 mpbd by 2025. Sustaining or increasing it will require additional investments at the existing oil fields, and it is unclear whether those will take place,” the agency said.
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