KUWAIT Petroleum Corporation began cutting oil output yesterday and declared force majeure, adding to earlier oil and gas reductions from Iraq and Qatar.
Kuwait Petroleum Corporation (KPC) declared force majeure, according to a trade notice seen by Reuters, after it implemented a reduction in crude oil production and refining throughput because of the conflict in the Middle East. The national oil company did not say by how much it would reduce output. In February, Kuwait produced around 2.6 million barrels per day of crude oil.
It said the reduction was precautionary and would be reviewed as the situation develops and it remained ready to restore production levels when conditions allow.
KPC declared force majeure because of what it said were explicit threats by Iran against the safe passage of ships through the Strait of Hormuz, continuing attacks by Iran on Kuwait and the “almost total absence” within the Arabian Gulf of vessels available to ship crude oil and products, the notice showed.
The company declined to comment on the notice.
KPC is a major exporter of naphtha to Asia and a major jet fuel exporter to north-west Europe. Naphtha is a feedstock for petro-chemicals production.
“The market is shifting from pricing pure geopolitical risk to grappling with tangible operational disruption, as refinery shutdowns and export constraints begin to impair crude processing and regional supply flows,” JP Morgan analysts said in a research note on Friday.
&uuid=(email))