Kazakhstan apparently produced far too much oil in May as well – Commerzbank
Kazakhstan is unlikely to have reduced its oil production in May, therefore once again significantly exceeding the agreed production volume.
OPEC+ countries may follow Kazakhstan and increase production more sharply
"As the news agency Reuters reported, citing an unnamed industry-related source, Kazakh oil production excluding condensates totalled 1.86 million barrels per day in the first 19 days of May. This was 2% more than in April and only slightly less than in March. According to the OPEC+ agreement, Kazakhstan is only expected to produce 1.49 million barrels per day in May. This does not include the planned compensatory cuts for the previous overproduction."
"The significant increase in production in recent months is attributed to the Tengiz oil field, which is expected to account for around half of Kazakhstan's oil production in May. According to Kazakhstan's Ministry of Energy, production in the Tengiz oil field has reached the targeted level, which is why production is not expected to increase any further this year."
"However, OPEC+ and Saudi Arabia in particular are unlikely to be satisfied with this. If Kazakhstan does not reduce production towards the agreed level, the seven other OPEC+ countries, which had voluntarily reduced their production, are also likely to increase production more sharply in the summer months. A similarly strong increase in production in July as in May and June has become very likely."
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FXStreet Insights Team
FXStreet
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