The Gulf Area National has no specific reduction in the number of barrels of oil per day, but says this is a precautionary measure and will reconsider depending on the actual situation in the area.
Kuwait is the fifth largest oil producer in the Oil Export Nations Organization (OPEC). In January, the country produced about 2.6 million barrels a day.
Kuwait's National Oil Group (Kuwait Petroleum Corporation) states they are willing to restore production levels when conditions allow.
World oil prices have increased by about 35% this week as tensions in the Middle East escalated from 28/2, interrupting with global power supply. Oil carriers could not pass through the Hormuz Channel - important shipping routes, which were feared by ship owners that the ship could be attacked.
This narrow sea route is the only way out to the Persian Gulf and about 20% of the global consumption of oil is delivered through here. According to Kpler's data, fuel exports through the Hormuz Channel averaged 3.7 million tons per month.
Oil exists in the Middle East due to the oil tanker not moving. Thus, manufacturers in the Gulf Area were forced to reduce production when the storage was insufficient. Iraq has cut 1.5 million barrels per day due to lack of storage space.
Get out! The conflict at the Middle East breaks the global energy export chain. Source: Reuters
- The conflict in the Middle East caused a break in the global energy export chain. Source: Reuters*
Natasha Kaneva, the head of the global freight research department of JPMorgan observed in a customer-subscription report on 6/3 that, the market moved from the purely political risk assessment to facing real-life disruptions.
According to Mrs Kaneva, the Middle East countries would be running out of storage and forced to close oil production if the conflict lasted for over three weeks. At that time, Brent's oil prices could exceed $100 per barrel.