Kazakhstan pegs oil production to global oil price


ASTANA (TCA) — Kazakhstan will take part in a meeting of OPEC and non-OPEC countries if it receives an invitation, Kazakh Energy Minister Vladimir Shkolnik said on the sidelines of the Parliament’s meeting on March 10, Novosti-Kazakhstan reported.  

Russian Energy Minister Alexander Novak earlier told Russian media that a list of countries to participate in a meeting of OPEC and other oil producing countries had not yet been finalized, but Kazakhstan might participate. The meeting to discuss a global oil production freeze may take place between March 20 and April 1.

“We (Kazakhstan) have an oil production scenario depending on global oil prices,” the Kazakh minister said. “The lower the price, the less is our possibility to produce oil, especially at water-flooded deposits and at depleting deposits where companies lack money for investing in exploration and deep drilling.”    

“The state budget was passed with the oil price of $30 per barrel, and this year’s oil production is planned at 74 million tons,” Minister Shkolnik said. “At an average price of $40-plus, oil production will be 77 million tons. We have slightly lowered production and hope that if other countries do the same, it will have a favorable effect on global oil prices. Supply would not exceed demand, and the prices will start stabilizing. For many oil fields, the current prices are lower than oil production costs.”

Sergey Kwan