OPEC+ is preparing to discuss Kazakhstan’s production at its upcoming meeting on Thursday, sources told Reuters. The eight-member group will seek to address the issue of Kazakhstan exceeding its production quota. Discussions will focus on how to persuade Kazakhstan to reduce its overproduction. Meanwhile, OPEC+ plans to gradually increase production to offset the surplus.
Kazakhstan’s Production Raises Concern Within OPEC+
Kazakhstan’s record production has raised concerns among several other OPEC members, including Saudi Arabia, OPEC+’s largest oil producer. OPEC+ is urging Kazakhstan to adhere to agreed quotas. It is also demanding additional cuts to offset the surplus caused by the increase in production.
Meeting Purpose: Educate Kazakhstan’s New Energy Minister
An OPEC+ delegate said the planned meeting is primarily aimed at educating Kazakhstan’s new energy minister about the importance of adhering to production quotas. The delegate added that the meeting will be an opportunity to highlight the importance of compensating for the surplus resulting from overproduction. He also noted that the meeting will be held behind closed doors, with the two delegates refusing to reveal their identities due to the sensitivity of the issue.
New Cabinet Appointments in Kazakhstan
Last month, Kazakh President Erlan Akinjinov appointed a new energy minister. This followed the appointment of his predecessor as head of the country’s newly established nuclear energy agency. This change in government may enhance the chances of reaching new solutions to regulate the country’s oil production.
Production Increase in May 2025
OPEC+ is expected to increase oil production by 135,000 barrels per day in May 2025. This increase will include eight OPEC+ members, a group that includes OPEC+ countries and other allies led by Russia. This increase will be part of a gradual plan agreed upon by major OPEC members, such as Russia, Saudi Arabia.
Oil Stabilizes as Market Awaits New US Tariffs
Oil prices steadied in thin trading on Wednesday after falling in the previous session on concerns that new US tariffs, scheduled to be unveiled at 2000 GMT, could deepen the global trade war that could curb demand for crude.
Brent crude futures rose 1 cent to $74.50 a barrel by 0346 GMT, after falling 0.4% on Tuesday. US West Texas Intermediate (WTI) crude futures rose 3 cents to $71.23 a barrel, after falling 0.4%. Prices settled at a five-week high on Monday.
The White House confirmed on Tuesday that President Donald Trump would impose new tariffs on Wednesday, although it did not provide any details on the size or scope of the trade barriers.
Oil prices rose about 2% in March but have since remained steady as markets await clarity on Trump’s plans for comprehensive tariffs before “Liberation Day.” Priyanka Sachdeva, senior market analyst at Philip Nova, said, “The weak trading volumes in the oil market indicate growing concerns about these tariffs, despite some positive demand indicators from mainland China.”
By 0353 GMT, Brent crude oil trading volume stood at 8,550 lots for June, compared to 672,617 lots of open interest for the same month, according to ICE data on the LSEG pricing platform.
For weeks, Trump has been promoting April 2 as “Deregistration Day,” which would bring with it new tariffs that would shake up the global trading system.
The announcement of tariffs could impact prices either upward or downward, although the risk tilts to the downside. Weaker-than-expected tariff measures are unlikely to cause a significant rise in Brent crude, while stronger-than-expected measures could trigger a significant sell-off.
Continued Production Cut Plan
OPEC+ continues to implement additional production cuts of 3.65 million barrels per day until the end of next year. These cuts were part of the organization’s commitment to reducing the oil surplus in global markets. These measures aim to support price stability, but reports indicate that some members, such as Kazakhstan, have not fully complied with their quotas.
The Closure of Kazakh Terminals and Its Impact on Production
This week, Russia ordered the closure of two terminals at the Black Sea terminal used by Kazakhstan to transport its oil exports. This decision is expected to indirectly reduce Kazakh production, as some of the oil cannot be exported through these terminals. This decision is part of ongoing efforts to control Kazakhstan’s oil production and prevent exceeding its quota.
The OPEC+ Ministerial Committee Meeting: New Opportunities for Future Decisions
The OPEC+ Ministerial Committee, which can recommend changes to production policy, is scheduled to meet on April 5, 2025. However, sources confirmed that the meeting may also take place on Thursday. The committee will discuss the dimensions of the ongoing production cuts and use the meeting as a platform to explore ways for OPEC+ to control and regulate production more effectively.
Oil Prices: Minor Movements as Production Cuts Ease
Regarding oil prices, markets experienced volatility over the past week as OPEC+ began increasing oil supplies starting April 1, 2025. On Tuesday morning, oil prices fell slightly. US West Texas Intermediate (WTI) crude futures were trading at $71.43 per barrel, down 0.07%. Brent crude also fell 0.08% to $74.65 per barrel.
