Middle Eastern oil producers are setting new records for exporting refined petroleum products, which is helping offset the impact of their ongoing crude production cuts, according to flow-tracking data and analysts cited by Reuters.
For years, OPEC+ producers have reduced crude oil output to stabilize the market, as they frequently state. However, in 2024, major OPEC+ producers in the Gulf have seen their fuel exports soar to a record high. This has likely diminished some of the market-driving effects of crude production cuts, especially given the slowing growth of fuel demand in China, the Reuters analysis suggests.
The OPEC+ agreement primarily addresses crude oil production among OPEC members and a group of non-OPEC nations led by Russia, but it does not include refined products. This allows Middle Eastern countries with significant refining capabilities to boost fuel exports without violating their crude production quotas.
According to data from Kpler and OilX, shipments of refined fuels from the Gulf states grew by 7% in 2024, reaching an all-time high. Saudi Arabia, Iraq, the United Arab Emirates (UAE), Kuwait, and Oman (an OPEC+ member but not an OPEC producer) together exported an average of 5.51 million barrels per day (bpd) of refined products, marking a more than 7% increase from the previous year.
Over the past 15 years, many Gulf countries have expanded their refining capacities. The Middle East has become a key region for global refining growth. For instance, Kuwait Petroleum Corporation (KPC) opened the massive Al-Zour Refinery in 2022, which, with a capacity of 615,000 bpd, is one of the largest crude processing plants in the region. The refinery, operated by Kuwait Integrated Petroleum Industries Company (KIPIC), began scaling up operations in 2023.
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