The closure of the Strait of Hormuz since the beginning of March has hit Kuwait especially hard, with the emirate having no alternative export route to reach its primary markets in Asia and Europe. Crude oil production has been cut to minimal operational levels required to meet domestic demand alongside small volumes of intra-Gulf trade (MEES, 5 June). The World Bank has warned that the economy could contract by 6.4% this year as a result (MEES, 10 April).
The conflict has exposed Kuwait’s lack of export flexibility, with the country having failed to reduce its reliance on a single export route. Unlike the UAE and Saudi Arabia, Kuwait has no coastline outside the strait, which complicates any bypass options, and a fallback option is no longer seen as a luxury but a necessity. Even should the Strait of Hormuz reopen tomorrow, the threat of closure will remain, and regional states have to plan accordingly. As Adnoc CEO Sultan al-Jaber said last month, “resilience may seem expensive until the day you need it, and when you need it, it becomes priceless.” (CONTINUED - 1395 WORDS)
