Kuwait exploring Saudi and UAE oil pipeline links

• Kuwait ‘speaking with everyone’
• War has cut production by 1m bpd
• Increased storage capacity a priority

Kuwait is considering oil pipeline links with Saudi Arabia and the UAE as disruption in the Strait of Hormuz constrains its exports, a state energy official has said.

“All options are open” and the country is “speaking with everyone” in the region about potential routes, said Shaikh Khaled Al-Sabah, Kuwait Petroleum Corporation’s (KPC) managing director of international marketing, on the sidelines of a conference in Singapore.

But when asked if Kuwait is considering joining high-profile projects being explored linking Iraq to Syria and Turkey, Al-Sabah said: “Let’s say probably nowadays we’re focusing in on the first couple of options [Saudi Arabia and the UAE].”

Kuwait has been among the states worst affected Gulf by the US-Iran war, which began on February 28 and has for months slowed marine traffic to a trickle through the Strait of Hormuz, one of the world’s most important energy chokepoints.

The disruption has pushed crude oil prices higher and strained exports of other materials that use the route, including fertiliser and aluminium.

Joining regional pipelines is one of three key strategies the country is pursuing as it attempts to rebound from the war, Al-Sabah said during a speech at the Asia Pacific Petroleum Conference by S&P Global Energy.

The country also plans to expand its tanker fleet and increase oil storage capacity overseas.

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“In KPC, we have our own fleet, which we are managing. We are in the market to acquire more ships,” Al-Sabah said.

“We can supply all of our customers but some volumes are not the same as before,” he added.

The country is going “full steam ahead” to establish more energy storage, said a person close to the company.

Kuwait produced about 2.6 million barrels per day of oil before the conflict began on February 28, according to the International Energy Agency. Production reached around 1.7 million barrels per day in July, IEA figures show.