Members of OPEC+, led by Saudi Arabia, have extended voluntary production cuts of 2.2 million barrels per day (bpd) until the end of the second quarter of 2024. Eight oil-exporting countries, including Kazakhstan, are joining the implementation of the agreements.
As reported by Reuters, the alliance countries have agreed to continue voluntarily reducing oil production, thereby providing additional support to the market amid rising oil output outside the OPEC+ group. Specifically, in the USA, Brazil, and Guyana.
For reference: The Organisation of the Petroleum Exporting Countries (OPEC) is an international organisation created by oil-exporting countries to control oil production quotas.
OPEC+ is a term used to denote countries not in OPEC but cooperating with the organisation on oil production and export issues. OPEC+ includes 11 countries, among them Kazakhstan.
The Ministry of Energy of the Republic of Kazakhstan stated that Kazakhstan intends to extend the production cut of oil by 82,000 bpd. In the future, production volumes will change depending on market conditions.
According to Reuters calculations, the total volume of OPEC+ cuts pledged since 2022 is about 5.86 million bpd, which corresponds to approximately 5.7% of daily global demand.
The outlook for oil demand in 2024 remains uncertain. In February of this year, the International Energy Agency (IEA) forecasted slow demand growth of approximately 1.22 million bpd. The IEA also expects oil supplies to rise to a record level of 103.8 million bpd, largely driven by producers outside the OPEC+ group.