According to a new resolution reached by the OPEC+ group of oil-producing nations that Baku has welcomed, Azerbaijan will boost oil output by 7,000 barrels per day (bpd) in January next year to 661,000 bpd.

As the COVID-19 epidemic disrupted oil production and demand, OPEC+, a consortium of OPEC and associated producers, including Azerbaijan, lowered output by a little more than 7 million bpd to sustain prices and reduce oversupply. Russia and Kazakhstan, two former Soviet oil-producing countries, are also OPEC+ members.

Members of the group decided in April 2021 to progressively reduce production cuts by 350,000 bpd in May, another 350,000 bpd in June, and roughly 450,000 bpd in July.

OPEC+ ministers agreed in July to boost total output by 400,000 bpd every month starting in August and by another 400,000 bpd starting in October. It was made in the wake of an increase in COVID-19 infections throughout the world and rising energy prices.

The revised agreement reached last week calls for an additional 400,000 bpd increase "unless the parties agree to abolish the limits."

Azerbaijan's Energy Ministry applauded the move, and the country is now on track to produce 661,000 barrels per day in January.

"The OPEC+ plan to progressively boost oil output from August 2021 adds to market balance, and we are heading in the correct path," the country's energy minister, Parviz Shahbazov, was reported as saying by his press service.

The country's oil output in October was 640,000 bpd, down from 586,200 bpd in August, and below the country's quota under OPEC+ obligations. In October, 704,400 barrels per day (bpd) of oil and gas condensate were produced. November's output data are yet to be revealed.

In the first ten months of this year, Azerbaijan's total oil and gas condensate output fell by 0.3% year on year to 28.8 million tonnes.

The huge offshore Azeri-Chirag-Guneshli (ACG) oilfields, constructed by a BP-led partnership, account for most of the Azerbaijan's oil output. The nation exports oil from the ACG via the Baku-Tbilisi-Ceyhan (BTC) pipeline, which runs via Georgia and Turkey. It also transports oil to Russia via the Baku-Novorossiysk pipeline, Georgia via the Baku-Supsa pipeline, and Georgia by rail.

BP said in August that oil output at its projects in Azerbaijan declined to 468,000 bpd in the first half of 2021 from 498,000 bpd a year earlier.

In 2020, Azerbaijan produced 34.585 million tonnes of oil and gas condensate, while natural gas output was 36.713 billion cubic metres (bcm).