Russian order slashes Kazakh oil export capacity amid OPEC+ row

MOSCOW, April 1 (Reuters) - Russia has ordered the Black Sea terminal handling Kazakhstan's oil exports pumped by U.S. majors Chevron CVX.N and Exxon Mobil XOM.N to close two of its three moorings amid a standoff between Kazakhstan and OPEC+ over excess production.

The operator of the Caspian Pipeline Consortium (CPC), which exports around 1% of global oil supply via the Russian terminal, said late on Monday that the two moorings were halted following snap inspections by Russia's transport watchdog.

The stoppage could more than halve CPC exports if it lasts for longer than a week, trading sources told Reuters.

The Russian order to CPC came just hours after U.S. President Donald Trump said he was unhappy with Russia and the rate of progress in peace talks with Ukraine and threatened to impose secondary tariffs on buyers of Russian oil.

RECORD-HIGH OUTPUT

Kazakhstan has frequently exceeded its production quotas under a pact among OPEC+ producers, which includes the Organization of the Petroleum Exporting Countries and allies, such as Russia.

However, it is finding it difficult to convince the companies operating its largest oilfields to reduce output where they have spent tens of billions of dollars to expand capacity.

According to two industry sources, Kazakhstan's oil output reached a record high in March with increased supply from the giant Tengiz oilfield and stable exports via the CPC, further exceeding OPEC+ production quotas.

Its oil and gas condensate production reached 8.95 million metric tons in March, or 2.17 million barrels per day (bpd), the sources said. Its energy ministry had reported output in February averaged 2.15 million bpd.

Kazakhstan's energy minister stepped down last month after tough discussions on OPEC+ compliance.

One OPEC+ source said there is always "a challenge" with Kazakhstan but it eventually gets resolved, referring to its excess output and the CPC moorings closure.

CPC said the mooring closures followed an inspection by Russia's transport watchdog, allowing the company to address "violations".

CPC did not specify the exact nature of these violations nor say how long the closures were expected to last.

It said the inspection was prompted by an oil product spill following the sinking of a Russian tanker in the Kerch Strait in December.

FLOWS UNINTERRUPTED

U.S. oil major Chevron CVX.N said on Tuesday that oil output at its unit in Kazakhstan, Tengizchevroil (TCO), as well as the delivery of oil to the Caspian Pipeline Consortium (CPC) pipeline remain uninterrupted.

Kazakhstan's energy ministry also said oil shipments via the CPC are being carried out normally without restrictions.

"At the moment there are no restrictions on receiving Kazakh oil into the system of CPC," the Kazakh energy ministry said in a statement. It said loading was being carried out "in normal mode, according to schedule" via the third mooring point, which was still in operation.

Separately, three industry sources told Reuters on Tuesday that Kazakhstan will have to start cutting its record high oil production within days due to reduced intake on the CPC.

Another source said that repair work at the CPC terminal would take more than a month.

A trader said he had not heard of any planned cuts to Kazakh production yet.

"One jetty is still loading, there is capacity for storage of five days at port. If the situation is not resolved in five days, then production cuts will be needed," he said.

Citing technical outages, Russia has closed the CPC moorings in the past. Operations were suspended in 2022 and 2023 due to damage and storms, interrupting CPC exports and hitting Kazakhstan's output.

In February, a Ukrainian drone attack struck a pumping station along the pipeline serving the terminal, according to CPC and Russian pipeline monopoly Transneft TRNF_p.MM.

The pipeline had been set to export 1.7 million barrels per day (bpd), or approximately 6.5 million metric tons, in April, Reuters reported.

It exported more than 63 million metric tons (1.4 million bpd) in 2024.

CPC's top shareholders are Transneft (24%) and Kazakhstan's KazMunayGas KMGZ.KZ (19%) while U.S. majors Chevron and Exxon Mobil also hold stakes.