Kuwait Petroleum explores Saudi and UAE pipeline links amid Hormuz constraints

Kuwait Petroleum pursuing Saudi and UAE pipeline connections#

Kuwait Petroleum Corporation is exploring oil pipeline links with Saudi Arabia and the United Arab Emirates as Strait of Hormuz disruption constrains exports, according to Shaikh Khaled Al-Sabah, the company's managing director of international marketing. Al-Sabah stated at the Asia Pacific Petroleum Conference in Singapore that "all options are open" and Kuwait is "speaking with everyone" in the region about potential routes. The company is focusing on Saudi Arabia and the UAE as the first two options for regional pipeline connections.

Production down 900,000 barrels per day since conflict began#

Kuwait produced approximately 2.6 million barrels per day of oil before February 28, according to the International Energy Agency. Production reached around 1.7 million barrels per day in July, IEA figures show. Kuwait's crude exports were approximately 375,000 barrels per day in August, compared with 1.2 million barrels per day in February, according to S&P Global Commodities at Sea data. Refined product exports stood at 174,000 barrels per day in August, down from 847,000 barrels per day in February.

Company expanding tanker fleet and storage capacity#

Kuwait Petroleum Corporation plans to acquire additional ships to reduce dependence on external vessel availability and improve scheduling control, Al-Sabah stated. "In KPC, we have our own fleet, which we are managing. We are in the market to acquire more ships," he said at the conference. The company is also pursuing increased oil storage capacity overseas as part of its strategy to maintain supply commitments to customers in neighbouring regions and Northwest Europe. A person close to the company stated Kuwait is going "full steam ahead" to establish more energy storage.

Regional pipeline infrastructure under development#

The United Arab Emirates is accelerating construction of a second pipeline running from western oilfields to Fujairah on the east coast, which lies beyond the Strait of Hormuz. Saudi Arabia is weighing building another pipeline or expanding existing infrastructure to its Red Sea facilities, though nothing has been finalised. Kuwait operates the 615,000 barrels per day Al Zour refinery and maintained operations through the early phase of the conflict by initially keeping refinery runs at minimum viable levels.