Kuwait crude oil output to hit 4 million in 2040!

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Kuwait crude oil output to hit 4 million in 2040! According to the statement issued by Kuwait Petroleum Corporation (KPC) last week, our current production is capped at 2.4 million barrels per day due to two voluntary reduction cuts totaling about 238,000 barrels in 2023 and 2024. Our three local refineries are operating at 1.4 million barrels per day, and an additional three refineries are currently operational in Oman, Vietnam , and Italy, with a combined capacity of about 6 0 0 , 0 0 0 barrels per day. Therefore, KPC’s refining capacity stands at two million barrels per day.

Consequently, there isn’t much net Kuwaiti crude oil remaining for global sale. This formidable challenge facing KPC makes it unlikely for us to make significant progress in discovering new oil reserves or increasing our production. One temporary solution may be to reduce refinery cuts, as we are currently doing with our latest Al-Zour refinery by cutting its throughput by 200,000 barrels to free up crude oil for sale. However, KPC did not provide details on the progress towards achieving its target of four million barrels, such as reaching three million barrels net of Kuwait Oil Company (KOC), excluding the Neutral Zone, for example. It also did not address whether we have halted the decline in crude oil production or how we are meeting the demands of our long-standing customers. It is disheartening to witness the decline in our primary source of income and the inability to increase our crude oil production. This raises recurring questions about our policy with OPEC+ regarding our commitment to reducing production at a time when Kuwait needs every barrel, as we are barely meeting our own foreign and domestic obligations.

Despite cutting our production once last year, we find ourselves compelled to reduce it again this year, resulting in the need to cut production at the Al-Zour refinery by 200,000 barrels per day to meet our crude oil sales obligations. Meanwhile, other OPEC+ members not only refuse to cut production but also exceed their established quotas, depriving us of additional funds while we face deficits in our budgets by the end of the financial year.

Predicting crude oil production for 2040 in 2024 is projecting too far ahead. KPC should have instead informed the USA about Kuwait’s production for a nearer term such as for 2026- 2027 or even shorter periods. Or it should wait for about six years to achieve such a figure, considering the uncertainties regarding the fate of fossil fuels and the development of alternatives to oil, or after figuring out when KPC can achieve a production level of three million barrels without taking into consideration the production from the Neutral Zone.

By Kamel Al-Harami
Independent Oil Analyst

Email: [email protected]

This news has been read 1013 times!