Oil Daily | Kazakhstan Eyes Production Cuts; US Firms Focus on Efficiency Amid Low Oil Prices

【Oil-Producing Countries Dynamics】

Kazakhstan is negotiating with major oil companies to reduce production in alignment with OPEC's agreements. The country aims to cut 620,000 barrels daily to offset previous overproduction. Currently, Kazakhstan's production quota is 1.5 million barrels a day. Discussions continue as OPEC plans minor production increases in April.

【Latest Oil Policies】

President Trump plans to establish metal refining facilities on U.S. military bases to boost domestic production of critical minerals, reducing reliance on China. The initiative will bypass local opposition and accelerate mineral supply, crucial for military and energy transition demands, although potential environmental regulation challenges remain.

【Industry News】

U.S. oil and gas companies may increase output through improved efficiencies rather than new drilling due to economic constraints, according to industry leaders. Despite Biden's previous calls for increased production, low oil prices have diminished drilling incentives, leading companies to prioritize shareholder returns over expansion.

Global trade in fossil fuels is declining as countries invest in renewables and nuclear energy for energy security, according to Carlyle Group's Jeff Currie. While fossil fuels still play a significant role in energy consumption, Europe is increasingly relying on renewables, with solar and wind power gaining ground.

The U.S. Supreme Court has rejected an attempt by Republican-led states to block climate change lawsuits against oil and gas companies brought by Democratic states. These lawsuits claim the industry misled the public about the hazards of fossil fuels, while the industry faces increasing operational risks due to climate change.

【Company News】

Abu Dhabi's ADNOC is considering an IPO for its energy investment firm XRG outside the UAE. Following the listing of ADNOC Gas and ADNOC Drilling, ADNOC plans to expand its international investments in low-carbon energy and chemicals, potentially listing XRG in London or New York in the future.

BP CEO Murray Auchincloss defended the company's decision to increase fossil fuel production and reduce renewable energy commitments, citing investor approval. BP's strategy shift includes boosting oil and gas output and raising spending, reversing previous targets to cut production, amidst investor pressure for higher returns.

【Others】

Vietnam risks losing $13 billion in renewable energy investment if it retroactively cuts feed-in tariffs, according to investors. Although Vietnam leads Southeast Asia in clean energy generation, proposed tariff reductions could undermine investor confidence, impacting projects already operating in the renewable sector.

India's thermal coal imports fell for the sixth consecutive month in February, attributed to increased domestic production and stagnant demand from industry and power generation. Despite the drop, coal demand is expected to rise with the upcoming summer season, as India continues to prioritize domestic coal supply over imports.