Kuwait exports one million barrels of oil per day
Kuwait exports approximately one million barrels of crude oil per day, including through ship-to-ship transfers outside the Strait of Hormuz, as oil flows through the waterway recover. Sheikh Khaled Al-Sabah, Managing Director of Global Marketing, said the state-owned Kuwait Petroleum Corp (KPC) also delivers shipments directly to customers. He added that the company uses its own tankers as well as chartered vessels to transport oil. Kuwaiti crude shipments have recovered to about two-thirds of last year’s average export volume of 1.6 million barrels per day, as more tankers find ways to navigate the Strait of Hormuz. He noted that Kuwait is seeking to purchase additional oil tankers.
Higher-cost Kuwaiti deliveries: Sheikh Khaled said at the Asia-Pacific Petroleum Conference organized by S&P Global Energy in Singapore, “We can supply all our customers, but some volumes are not as they used to be.” He added that buyers will have to pay more for KPC crude delivered outside the Strait of Hormuz to compensate for transit risks, while those receiving shipments within the Arabian Gulf will receive discounts.
Estimates of daily flows through the Strait of Hormuz vary. Russell Hardy, CEO of Vitol Group, estimated those flows at around 10 million barrels, including 9 million barrels of crude, while Macquarie Group Ltd estimated quantities at around 7 million barrels per day of crude and refined fuels. This remains less than half the 20 million barrels per day that used to pass through the waterway before the war. Shipments continue even as fighting between the United States and Iran resumes after a period of relative calm, threatening new disruptions to energy flows through the waterway. Control of the Strait of Hormuz remains a key point of contention. Iran said an agreement with Oman to manage shipping traffic through the strait is imminent.
Kuwait boosts fuel production: Sheikh Khaled revealed that Kuwait plans to increase refinery operating rates to boost fuel supplies amid ongoing shortages in product markets, including diesel.
Alternative routes: Sheikh Khaled said Kuwait is evaluating alternative pipeline routes for crude exports, including through Saudi Arabia and the United Arab Emirates. With Washington and Tehran at an impasse, Gulf producers are finding ways to ship oil to customers through one of the world’s most critical energy chokepoints. Ship-to-ship transfers, known as “shuttle trading,” have become more common, while producers are also exploring pipelines that bypass the Strait of Hormuz entirely.
