Kazakhstan continues to produce too much oil - Commerzbank

Kazakhstan continues to produce significantly more oil than agreed and apparently has no plans to reduce production in May, Commerzbank's commodity analyst Carsten Fritsch notes.

Saudi Arabia may push for a strong increase in oil production

"According to the Kazakh Energy Ministry, daily production, including condensates, is likely to amount to 277 thousand tons in May, the same level as in April. In March, production amounted to 260 thousand tons per day. The production reported for April and May corresponds to a good 2 million barrels per day."

"Condensates account for around 260 thousand barrels per day, meaning that crude oil production is likely to be around 1.75 million barrels per day. The ceiling agreed for May would therefore be exceeded by around 300 thousand barrels per day if the compensatory cuts are not taken into account."

"This increases the risk that Saudi Arabia will also push for a strong increase in oil production in July. The downside risks for oil prices are therefore increasing further."