Kazakhstan Reports Sharp Decline in Oil and Gas Production

Official data reveals a significant downturn in Kazakhstan's oil and gas sector during the first quarter of the year. The country's overall economic growth is now projected to proceed without a positive contribution from its traditionally dominant oil industry.

Azamat Amrin, Vice Minister of National Economy, reported that real GDP growth for the first three months reached 3 percent. However, the share of the oil sector in the national economy has halved compared to previous periods.

"I want to emphasize once again that this year's economic growth will be ensured without a positive contribution from the oil sector," stated Amrin. He detailed that production volume in the mining industry fell by 11.4 percent year-on-year from January to March. This decline was driven primarily by a 19.8 percent drop in crude oil extraction and a 15.1 percent reduction in natural gas production.

Energy Minister Yerlan Akkenzhenov provided further context for the slump. He attributed the lower output figures to operational situations at key facilities, specifically mentioning issues at the Caspian Pipeline Consortium (CPC) and the Tengiz field.

"For the reporting period, the volume of oil and gas condensate production amounted to 19.7 million tons, or 80.2 percent of the same period last year," Akkenzhenov said.

The minister outlined ongoing efforts to stabilize output. At the Karachaganak field, work continues on commissioning a sixth raw gas re-injection compressor, which is expected to help maintain annual oil production at a level of 10-11 million tons. Furthermore, negotiations are underway with major subsoil users on measures to increase oil extraction.

The export figures mirrored the production decline. In Q1, Kazakhstan exported 15.3 million tons of crude oil, representing just 78.5 percent of exports during the same period last year. The official forecast for total exports this year stands at 76 million tons.

The news from Kazakhstan comes amid volatile global energy markets. Following recent geopolitical statements concerning potential disruptions to key shipping routes like the Strait of Hormuz, international benchmark prices have seen sharp increases.