Kazakhstan's Oil Production Slumps Due to Declining Output and Limited Export Capacity

Kazakhstan's oil production has been hit by declining output and limited export capacity. The country produced 61.7 million tonnes of oil in the first eight months of 2026, which is an 8.4% decrease from its initial plan for this period.

The Kazakh government has lowered its annual production forecast from 100 million to 96 million tonnes. This reduction comes despite efforts to increase shipments across the Caspian Sea to Azerbaijan, where oil can be transported westward via the Baku, Tbilisi, Ceyhan pipeline.

However, the capacity of this route for Kazakh oil is limited, and the country has had to rely heavily on its existing export infrastructure. The Caspian Pipeline Consortium (CPC), which transports over 80% of Kazakhstan's crude oil exports to Russia, has faced disruptions in recent months due to Ukrainian drone attacks.

Kazakhstan is seeking to diversify its export routes and explore new opportunities for supplying oil to Europe. Analysts believe that building a Trans-Caspian pipeline would require significant investment, political will, and funding, which Kazakhstan may not have sufficient resources to implement on its own.