Kuwait Investment Company (KIC): Kuwait has recovered its oil production at a faster pace than expected
The report by KAMCO Invest pointed to renewed escalation of tensions between the United States and Iran, which pushed oil prices back above $80 per barrel. Uncertainty surrounding the prospect of a permanent peace agreement in the region brought back the war-related risk premium, erasing the declines seen over the past three weeks.
The report noted that the reimposition of a US blockade on Iranian ship transit through the strait pushed prices further toward $85 per barrel. Prices also received strong support from global efforts to rebuild inventories, aiming to enhance energy security resilience against any future disruptions. Nevertheless, prices experienced continuous declines from levels exceeding $120 per barrel at the beginning of May 2026, trading near $70 by the end of June 2026.
The report highlighted a strong recovery in global oil supplies in June 2026, following three consecutive months of declines through May 2026. Data from the International Energy Agency (IEA) showed global supplies rose by 4.8 million barrels per day in June 2026, reaching 98.8 million, after falling by 0.6 million in May 2026. The increase followed the resumption of crude oil flows through the Strait of Hormuz, albeit partially, alongside US production reaching record levels. However, the agency noted that despite this rise, global production remained approximately 9.4 million barrels below pre-war levels. For the full year, the IEA expects global oil supplies to decline by 3.7 million barrels per day, averaging 102.6 million. For 2027, the IEA forecasts growth of 7.5 million, contingent on an increase in shipment flows.
The report covered OPEC crude production, which showed partial recovery in June after declining in the previous month to its lowest levels in several decades due to the closure of the Strait of Hormuz. Production growth followed a temporary peace agreement between the US and Iran that kept the vital waterway open for only about three weeks. OPEC’s average production rose by 2.34 million barrels per day during the month to reach 18.75 million, according to Bloomberg data, driven by a broad-based increase in production across most member countries.
The report stated that Kuwait recorded the largest increase within the group, rising by 870,000 barrels per day, bringing its average production to 1.36 million barrels per day in June 2026.
Some reports, citing sources in Kuwait’s oil sector, indicated that Kuwait restored its production at a faster-than-expected pace, approaching pre-war levels of approximately 1.9 million barrels per day.
It noted that secondary OPEC sources recorded a relatively slower increase in the organization’s production, rising by 1.41 million barrels per day in June 2026 (excluding UAE production). OPEC data also showed that Kuwait recorded the fastest production recovery rate within the group, increasing by 880,000 barrels per day to reach an average of 1.45 million, followed by Iraq, which recorded an increase of 446,000 barrels per day to reach an average of 1.97 million. Iran also raised its production by 155,000 barrels per day to reach 2.44 million.
