Kazakhstan’s record-high oil production played a pivotal role in OPEC+’s decision to approve a modest output increase, sources revealed. The group, which includes OPEC members and allies like Russia, agreed on Monday to raise production by 138,000 barrels per day (bpd) starting in April, marking the first increase since 2022.
The decision came after intense internal debate, with some members advocating for maintaining output cuts due to weak global demand, while others, including the United Arab Emirates (UAE) and Russia, pushed for an increase. Kazakhstan’s overproduction, driven by Chevron’s expansion at the Tengiz oilfield, tipped the scales in favor of the hike, according to three OPEC+ sources.
Kazakhstan’s crude and condensate output reached a record 2.12 million bpd in February, well above its OPEC+ quota of 1.468 million bpd for crude. The country’s overproduction, along with similar issues in Iraq, Russia, and the UAE, has frustrated Saudi Arabia, which has adhered strictly to its output targets.
OPEC+ members pledged to improve compliance and compensate for overproduction in the coming months. However, Kazakhstan’s actions have raised concerns about discipline within the group. “It’s very bad for discipline inside OPEC+,” one source said, adding that Kazakhstan would face pressure to compensate for its excess output.
The decision to increase production also aligns with U.S. President Donald Trump’s calls for lower oil prices, though sources said his public pressure was not a direct factor in OPEC+ discussions. Instead, the move suited members like the UAE, which seeks to utilize its growing spare capacity, and Russia, which views the hike as a way to improve relations with the U.S.
Helima Croft of RBC Capital Markets noted that Russia could appear aligned with the White House while maintaining its OPEC+ commitments. If Trump eases sanctions on Russia as part of a peace deal in Ukraine, Moscow stands to benefit from higher oil revenues and increased exports.
The output hike reflects OPEC+’s balancing act between addressing market fundamentals and managing internal tensions, as the group navigates a complex geopolitical and economic landscape.