Oil Falling: Kazakhstan Unlikely to Meet GDP Expectations

The government is unlikely to achieve President Toqayev's goal of six-percent GDP growth in 2024, Orda reports.

By the end of the year, the indicators may worsen further.

In their latest report, Halyk Finance analysts confirm the government has fallen short of the 6% GDP goal. 

They believe economic growth in 2024 will not exceed four percent — the realistic projection is 3.9%.

The reason is the mining sector's +0.3% year-on-year growth. Even considering other industries, such as trade, it is impossible to reach the six percent figure without oil revenues. The mining industry accounts for 14% of the GDP, while oil production accounts for 71% of the entire industry.

The chief Halyk Finance analyst, Nurlan Kanzhanov, emphasizes that oil production volume decreased by 1.8% compared to last year, and 8.4% metal production growth year-on-year was the saving grace.

Although 2024 started with strong growth, oil production has been gradually declining. During the first nine months of the year, production volumes remained relatively stable, fluctuating in the range of 7-7.8 million tonnes per month. However, there was a sharp decline in October: production fell by 15.2% compared to October 2023, falling from 7.7 million tonnes to 6.6 million tonnes. The October decline in production was due to major repairs at major fields such as Tengiz and Kashagan, as well as unscheduled shutdowns at the Karachaganak field,
 notes Nurlan Kanzhanov.

The Ministry of Energy has lowered its oil production forecast by 2% under favorable conditions. 

Analysts also note the significant drop in oil prices: in 2023, the average price was $82.2 per barrel, now $72–$73. 

Original Author: Nikita Drobny