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Kuwait says oil buyers do not want to increase imports next year


(Bloomberg) — Kuwait’s state-owned energy company said customers are reluctant to increase oil imports next year, signaling that the market is being held back by weakness in the global economy.

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Sheikh Nawaf Al-Sabah, chief executive officer of Kuwait Petroleum Corp., said: “We are really worried about where demand will go in the next few months and years, especially if there is a recession. “. Friday. “We are talking to our customers. They’re saying either they’re asking for the same amount of oil, or they’re asking for a little less next year.”

This OPEC member exports about 2 million barrels of crude oil per day, mostly to Asian countries such as China, South Korea, Japan and India.

The Organization of the Petroleum Exporting Countries, which includes de facto leader Saudi Arabia, has said that oil consumption is being hit by slowdowns in the US, Europe and China. The group and its allies, known as OPEC+, decided to cut production during a meeting in early October. That angered the United States, which wanted to lower oil prices.

OPEC+ meets again on Sunday. Despite the weak outlook on demand, many traders and analysts expect it to keep output steady. That’s partly because members may want to assess the impact of the G7 price cap on Russian crude exports starting on Monday.

Diesel to Europe

Kuwait has invested tens of billions of dollars in upgrading and building new refineries in recent years. Sheikh Nawaf said that will allow the country to boost exports of diesel and jet fuel to Europe by 2023. These shipments will contribute a small part to replacing refined oil flows from Russia. , which the European Union will ban from February as part of sanctions against Moscow for its invasion of Ukraine.

Kuwait exported its first jet fuel from the new Al-Zour refinery last month. The facility is designed to handle 615,000 barrels per day, making it one of the largest refineries in the world. It is expected to be completed early next year, bringing Kuwait’s total refining capacity to about 1.5 million bpd.

“There won’t be so much raw as product” when it comes to sales to Europe, said the executive. The increase in exports of diesel and other Middle Eastern products to Europe could be “permanent”, he said, with Russia forced to focus more on Asian markets.

Climate target

He said Kuwait believes oil will remain the main source of energy for the global economy even as countries transition to cleaner fuels and renewable energy.

“It’s not something that can happen overnight — it’s not an energy switch,” said Sheikh Nawaf. “In any transition, the oil will be there.”

As part of Kuwait’s goal to neutralize global warming emissions within its borders by 2050, the country will invest in solar energy and carbon capture technology. That would allow it to reduce the intensity of emissions during its oil production, he said.

“We want to reduce that carbon intensity to essentially zero,” he said.

–With support from Guy Johnson and Elena Gergen-Constantine.

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