Latest news with #Tengiz
Yahoo
05-07-2025
- Business
- Yahoo
OPEC+ Surprises With Oversized Output Hike
OPEC+ will ramp up oil production more aggressively than anticipated in August, accelerating the rollback of its 2023 voluntary supply cuts in a bid to capture market share amid peak summer demand. At a virtual meeting Saturday, eight core members led by Saudi Arabia agreed to add 548,000 barrels per day (bpd) to global supply—exceeding earlier expectations of a 411,000 bpd hike. The move sets the bloc on track to fully unwind 2.2 million bpd of prior cuts nearly a year ahead of schedule. The decision reflects short-term bullish fundamentals: inventories are low, refining margins are strong, and U.S. refiners are processing the most crude for this time of year since 2019. Still, it signals a major pivot from price defense to volume maximization. In a quote to Bloomberg, Onyx Capital's Harry Tchilinguirian noted that "It was pointless to keep a notional voluntary cut in place,' said . 'Better to get it over with and move on.' But while Saudi Arabia pushes discipline, Kazakhstan is going its own way. In June, Kazakhstan's crude output surged 7.5% to 1.88 million bpd—well above its official OPEC+ quota of 1.5 million bpd. This matched its all-time production high, largely driven by Chevron's expansion of the Tengiz mega-field, which alone added 140,000 bpd month-over-month. Kazakhstan's total oil and condensate production hit 2.15 million bpd in June, up from 2.02 million in May. Despite repeated pledges of OPEC+ compliance, Kazakh authorities admit they can't enforce production cuts on foreign-led projects like Tengiz or Kashagan. 'The republic has no right to enforce production cuts,' Energy Minister Yerlan Akkenzhenov said in May. Chevron, for its part, has stated bluntly that it doesn't 'engage in discussions about OPEC or OPEC+.' Meanwhile, oil prices remain under pressure. Brent futures are down more than 6% year-to-date, and analysts estimate that global inventories have been climbing at 1 million bpd in the first half of 2025, amid cooling demand in China and production increases in non-OPEC countries. Analysts at JPMorgan and Goldman Sachs earlier this year warned prices could dip below $60 in Q4. OPEC+ is betting that strong summer demand will soak up the new supply. But as Kazakhstan pumps freely and Saudi Arabia chases volume, the group's cohesion faces growing uncertainty. By Tom Kool for More Top Reads From this article on
Reuters
01-07-2025
- Business
- Reuters
Exclusive: Kazakhstan's oil output returns to growth in June, matching record-high
MOSCOW, July 1 (Reuters) - Oil output in Kazakhstan, one of the world's 10 biggest producing countries, returned to growth last month and matched an all-time high, as the Chevron-led (CVX.N), opens new tab Tengiz field ramped up, a source familiar with the data told Reuters on Tuesday. Kazakhstan has persistently exceeded quotas set by OPEC+, which groups the Organization of the Petroleum Exporting Countries and other producers led by Russia. Its overproduction has angered some of the group's members, sources have told Reuters, and has been one of the reasons for faster-than-expected output increases from OPEC+ as it fights for market share and seeks to punish those breaching curbs with lower international prices. The source, speaking on condition of anonymity because of the sensitivity of the issue, said Kazakhstan's daily crude oil output, excluding gas condensate, a type of light oil, jumped in June by 7.5% from May to 1.88 million barrels per day. That matched an all-time high reached in March and was above Kazakhstan's quota of 1.5 million bpd for June under the OPEC+ deal. Total oil and gas condensate production in Kazakhstan rose to 2.15 million bpd last month from 2.02 million bpd in May, according to the source. Daily oil output at Tengiz, Kazakhstan's largest oilfield, jumped in June to 953,000 bpd from 813,200 bpd in May, the source said. Chevron embarked in January on a $48 billion expansion of Tengiz, which is one of the world's deepest and most complex fields due to high sulphur levels and harsh weather conditions. Tengizchevroil, the operator of Tengiz, has not commented on its commercial activity, while Kazakhstan's energy ministry did not immediately reply to a request for comment. It has said it was committed to the OPEC+ deal, but also said the country's national interest is of paramount importance. Eight members of OPEC+ - Saudi Arabia, Russia, Kuwait, Iraq, the United Arab Emirates, Kazakhstan, Oman and Algeria - will meet on July 6 to decide on their production policy for August. Four delegates from the group told Reuters that OPEC+, is set to announce another big increase of 411,000 barrels per day in production for August. According to the source and Reuters preliminary calculations, the country's crude oil production without condensate rose in the first half of the year by 13% from the same period a year ago to 1.79 million bpd. Kazakhstan may exceed its previous oil production forecast by around 2% this year following an upgrade to output at its largest Caspian oilfields, Reuters calculations, based on data from state-owned energy company KazMunayGaz ( opens new tab, showed on Monday.
Reuters
30-06-2025
- Business
- Reuters
Kazakhstan may beat its oil output forecast by 2% in 2025, Reuters data shows
MOSCOW, June 30 (Reuters) - Kazakhstan may exceed its previous oil production forecast by around 2% this year following an upgrade to output at its largest Caspian oilfields, Reuters calculations, based on data from state-owned energy company KazMunayGaz ( opens new tab, showed. According to calculations, oil output in Kazakhstan may rise this year to around 97.7 million metric tons, or 2 million barrels per day, from a previous projection of 96.2 million tons. Kazakhstan, among the world's 10 biggest oil producers, has persistently exceeded quotas set by OPEC+, an alliance between the Organization of the Petroleum Exporting Countries and other producers led by Russia. KazMunayGaz raised its forecasts for oil output at the country's largest oilfield, Tengiz, by 900,000. It also revised up expectations for output at Kashagan by 200,000 tons and Karachaganak by 360,000 tons. U.S. major Chevron (CVX.N), opens new tab embarked in January on a $48 billion expansion of Tengiz, which is one of the world's deepest and most complex fields due to high sulphur levels and harsh weather conditions. Output at the field from January to May reached 15.9 million tons, according to KazMunayGaz. Kazakhstan produced 87.8 million tons last year.
New Straits Times
27-05-2025
- Business
- New Straits Times
OPEC expected to open taps more despite price slump
This follows pressure from US President Donald Trump and group leader Saudi Arabia's quest to penalise allies that breach the cartel's quotas. In past months, Saudi Arabia, Russia and six other OPEC+ members have surprised markets by announcing a sharp increase in oil production for May and June despite the low prices. Numbering a total of 22 countries, most of which are highly dependent on oil revenues, the group has long been exploiting supply scarcity to boost prices, holding millions of barrels in reserve. This week the cartel will hold two meetings -- one online on Wednesday with all OPEC+ members to discuss the group's common strategy, and one on Sunday with just the eight member states -- known as the "V8" -- that have made the largest cuts in recent years. "What's most interesting is the V8 decision" in Sunday's meeting regarding production for July, UBS analyst Giovanni Staunovo told AFP. Analysts expect the V8 to up production by 411,000 barrels a day for July -- the same as in May and June -- whereas the initial plan called for an increase of just 137,000 barrels. This could further weigh down prices already slumping to lows last seen during the pandemic, which hit global demand. The Organization of the Petroleum Exporting Countries and their allies -- collectively known as OPEC+ -- have justified their change in strategy by citing "current healthy market fundamentals, as reflected in the low oil inventories". But observers are sceptical, given concerns about global demand due to the trade war that Trump has unleashed. Since late 2022, the cartel had slashed production, with Riyadh, Moscow and the six other OPEC+ members withholding 2.2 million barrels per day. At the start of the year, the group said it would reintroduce some of the oil kept under ground, but it has significantly accelerated the pace. With this, OPEC leader Saudi Arabia effectively puts pressure on members that have failed to cut back their production as agreed, reducing their profits. Behind the quota violations, there are "people who make investments and want to monetise the benefit", Lawrence Haar, an associate professor at the University of Brighton, told AFP. For Kazakhstan, the main offender within the group, the increase in recent production is linked to the Tengiz project, whose main operator is the American group Chevron, according to Francis Perrin, a senior research fellow at the Institute for International and Strategic Relations (IRIS). Other countries, such as Iraq or the United Arab Emirates, have also increased output more than agreed, but Riyadh targets especially Astana. "Kazakhstan continues to overproduce massively above its OPEC+ quota, and Saudi cannot walk back on its threats of punishing the cheaters without losing credibility, so it leaves Saudi with no choice," DNB Carnegie analysts said. Beyond these internal disputes, "it is absolutely impossible to interpret the change in position of the eight OPEC+ countries without referring to the pressure from Donald Trump", according to Perrin. The US leader -- aiming to drive down prices to combat inflation being stoked domestically -- said in late January that he would ask Saudi Arabia and other OPEC nations "to bring down the cost of oil". During Trump's recent diplomatic tour of Gulf countries, "none of that has been mentioned", suggesting that "he seems to be happy with the actions" of OPEC+, said Carole Nakhle, an economist at the Surrey Energy Economics Centre. OPEC+ is also no doubt keeping an eye on the outcome of discussions between Tehran and Washington on the Islamic republic's nuclear programme. If a deal on that were reached -- and sanctions lifted -- OPEC member Iran's oil would also come onto the global market. Excessively low oil prices do present a challenge for Saudi Arabia, the world's largest oil exporter, to finance its ambitious plan aimed at diversifying the economy. "The Saudi Arabian economy depends on oil," Nakhle stressed.
The Star
26-05-2025
- Business
- The Star
Opec+ likely to open taps more despite price slump
LONDON: Despite oil trading low at US$60, the Organisation of the Petroleum Exporting Countries and its allies (Opec+) this week is expected to continue to further open the taps. This follows pressure from US President Donald Trump and group leader Saudi Arabia's quest to penalise allies that breach the cartel's quotas. In past months, Saudi Arabia, Russia and six other Opec+ members have surprised markets by announcing a sharp increase in oil production for May and June despite the low prices. Numbering a total of 22 countries, most of which are highly dependent on oil revenues, the group has long been exploiting supply scarcity to boost prices, holding millions of barrels in reserve. This week the cartel will hold two meetings – one online tomorrow with all Opec+ members to discuss the group's common strategy, and one on Sunday with just the eight member states – known as the 'V8' – that have made the largest cuts in recent years. 'What's most interesting is the V8 decision' in Sunday's meeting regarding production for July, UBS analyst Giovanni Staunovo said. Analysts expect the V8 to up production by 411,000 barrels a day for July – the same as in May and June – whereas the initial plan called for an increase of just 137,000 barrels. This could further weigh down prices already slumping to lows last seen during the pandemic, which hit global demand. Opec+ has justified its change in strategy by citing 'current healthy market fundamentals, as reflected in the low oil inventories'. But observers are sceptical, given concerns about global demand due to the trade war that Trump has unleashed. Since late 2022, the cartel had slashed production, with Riyadh, Moscow and the six other Opec+ members withholding 2.2 million barrels per day. At the start of the year, the group said it would reintroduce some of the oil kept under ground, but it has significantly accelerated the pace. With this, Opec leader Saudi Arabia effectively puts pressure on members that have failed to cut back their production as agreed, reducing their profits. Behind the quota violations, there are 'people who make investments and want to monetise the benefit', Lawrence Haar, an associate professor at the University of Brighton, told AFP. For Kazakhstan, the main offender within the group, the increase in recent production is linked to the Tengiz project, whose main operator is the American group Chevron. This is according to Francis Perrin, a senior research fellow at the Institute for International and Strategic Relations. Other countries, such as Iraq or the United Arab Emirates, have also increased output more than agreed, but Riyadh targets especially Astana. 'Kazakhstan continues to overproduce massively above its Opec+ quota, and Saudi cannot walk back on its threats of punishing the cheaters without losing credibility, so it leaves Saudi with no choice,' DNB Carnegie analysts said. Beyond these internal disputes, 'it is absolutely impossible to interpret the change in position of the eight Opec+ countries without referring to the pressure from Donald Trump', according to Perrin. The US leader – aiming to drive down prices to combat inflation being stoked domestically – said in late January that he would ask Saudi Arabia and other Opec nations 'to bring down the cost of oil'. During Trump's recent diplomatic tour of Gulf countries, 'none of that has been mentioned', suggesting that 'he seems to be happy with the actions' of Opec+, said Carole Nakhle, an economist at the Surrey Energy Economics Centre. Opec+ is also no doubt keeping an eye on the outcome of discussions between Tehran and Washington on the Islamic republic's nuclear programme. If a deal on that were reached – and sanctions lifted – Opec member Iran's oil would also come onto the global market. Excessively low oil prices do present a challenge for Saudi Arabia, the world's largest oil exporter, to finance its ambitious plan aimed at diversifying the economy. 'The Saudi Arabian economy depends on oil,' Nakhle stressed. — AFP
