Kuwait Refining Earnings Undermined By Weak Product Export Prices

KNPC’s income from products export has been hit by the collapse in international spot prices. Despite subsidized prices, KNPC is earning more per barrel from domestic diesel sales than from exports.

Weakness in global oil markets has significantly hit the profits of state refiner Kuwait National Petroleum Company (KNPC), according to CEO Muhammad al-Mutairi. Yet, while Kuwait is the only GCC country that has not reduced subsidies on transport fuels, diesel – its main export – currently fetches more on the domestic market than on the Middle East spot market.

The bulk of KNPC’s income normally comes from products exports, which account for almost 75% of refinery output. In the first three quarters of 2015, KNPC refineries delivered an average 1.07mn b/d of products, according to Jodi, while total products exports averaged 792,000 b/d.


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