SEATTLE (Oil Monster): Kazakhstan said on Thursday it had reduced oil production after suspected Ukrainian drone attacks forced its main export terminal on the Black Sea to close, with one source saying its biggest field had slashed output by more than half.
Disruption to the route, which handles around 2% of the world's daily crude supply, adds to pressure on an oil market already grappling with the effective closure of the Strait of Hormuz and threats to Saudi Arabian exports via the Red Sea.
Kazakhstan's energy ministry said oil companies had reduced output due to export constraints, saying that Caspian Pipeline Consortium (CPC) pipeline loading operations had been suspended for safety reasons.
"Due to restrictions on crude oil intake into the pipeline system and in order to prevent storage tank congestion at oil-producing companies, a controlled adjustment of daily production levels was implemented resulting in a temporary reduction in oil output," it said in emailed comments.
The ministry did not specify the scale of the production reductions.
Output has been reduced in particular at the Chevron-led (CVX.N) Tengiz oilfield, Kazakhstan's largest, two industry sources said.
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Output there had more than halved, one source said, to around 406,000 barrels per day on Wednesday from 925,000 bpd on average this month.
The country's overall oil and gas condensate output on Wednesday fell to 1.63 million bpd from July's average of 2.07 million, the source said.
Chevron did not immediately reply to a Reuters request for comment.
More than 1,500 km (940 miles) long, the CPC pipeline runs from Kazakhstan's Tengiz oilfield in the west of the country via Russia to the port of Novorossiysk on Russia’s Black Sea coast.
Consultations are ongoing between the ministry, oil producers, CPC, shipowners and administrative state bodies in order to resume stable oil exports, the energy ministry said.
The hit to production follows the CPC's decision to stop receiving oil from Kazakhstan after suspending loadings on Monday due to attacks on oil tankers at its Black Sea terminal in Russia.
Sources said drones attacked two more tankers near the terminal on Thursday, setting one of them on fire.
Russia has accused Ukraine of targeting CPC tankers as part of its "ambition to further destabilise the situation on global oil markets".
Ukraine, which has stepped up its strikes on Russia's energy infrastructure in recent months, has not commented on the attacks.
Courtesy: www.reuters.com
