Kuwait Becomes Qatar’s Largest Fuel Oil Supplier

Kuwait has become the leading supplier of fuel oil to Qatar amid its recently opened Al Zour refinery from which is shipped a total of 3mn barrels of fuel oil to Qatar so far this year, overtaking last year's suppliers including Bahrain, Malaysia and Singapore according to Kpler shipping data.

• The refinery began exporting jet fuel, naphtha, and low-sulfur fuel oil in November after commissioning the first of its three crude distillation units with plans to have production capacity of 615kbpd by the end of this year according to S&P Commodity Insights.
• Exports of very low sulfur fuel oil to Qatar hit an all-time high 27kbpd in March have continued to flow with Doha receiving 20kbpd of VLSFO in June and 19kbbpd in July, Kpler data showed.
• Al Zour will be largely responsible for an increase in Middle East refinery runs in the third quarter, rising about 350kbpd from the second quarter, according to S&P Global Commodity Insights. Fuel oil production will get a boost in the second half by Al Zour, it said.
• In addition, Al Zour hopes to double its jet fuel exports to Europe year on year in 2023.
• Flows to Qatar follow Kuwait's earlier ramp-up of clean products to Europe. Exports surged to an all-time high of 410kbpd in June but declined to 302kbpd in July, according to Kpler. The main products being sold into Europe, which has been looking for alternatives to Russian imports include ultra low sulfur diesel and jet fuel.
• At least two-thirds of the Al-Zour's production will be diverted to overseas markets, as opposed to original plans to use the supplies as a replacement for fuel oil consumed to produce electricity in Kuwait, Sheikh Khaled al-Sabah, Kuwait Petroleum Corp.'s managing director of international marketing, said previously.
• Crude exports out of Kuwait dropped by over 400kbpd in July year on year as the crude is largely being redirected to toward the Al-Zour refinery according to Kpler.