Oil prices have continued to rise as fears increase that unrest in Kazakhstan would hit oil production in the country.
On January 6, the operator of Kazakhstan’s highest-producing oil field, Tengiz, said that a logistics issue had caused it to changed its production levels with political protests ongoing at the site. S&P Global Platts reported that it remains unclear as to whether this logistical problem is directly related to the wider disruption across the country.
The Tengizchevroil consortium, a group comprised of Chevron (50 percent), ExxonMobil (25 percent), KazMunaiGas (20 percent) and Lukoil (5 percent), said in a statement to S&P that contract workers at Tengiz were still “gathered” in “support of protests taking place across Kazakhstan.”
“TCO is focused on ensuring the safety and well-being of its workforce at Tengiz and maintaining safe operations,” the consortium told S&P. “TCO production operations continue, however, there has been a temporary adjustment to output due to logistics.”
Kazakhstan is a major global oil player, producing around 1.6 million barrels of oil per day.
Meanwhile, prices have also continued to rise as maintenance and oilfield shutdowns continue in Libya. National Oil Corp said that output was down to 729,000 barrels per day, from a high of more than 1.3 million barrels per day last year, Reuters reported.
With both unrest in Kazakhstan threatening production, and lower production in Libya, oil prices have risen over $82. Prices have continued to increase since the beginning of the year, even despite a commitment by members of the Organization of Petroleum Exporting Countries (OPEC) and their allies, known as the OPEC+ group, to continue to increase output.
Earlier this week, the OPEC+ group agreed to add another 400,000 barrels per day of supply to global markets in February, a continuation of its output increase plan since August last year. The group had sought to massively cut production in 2020 to stabilise the oil market amid plunging prices due to falling demand caused by the Covid-19 pandemic.
