Kuwait cuts oil production as Strait of Hormuz closure disrupts global energy markets - What does this mean? Explained [View all]

Source: msn

10h


Kuwait, the fifth-largest oil producer within the Organisation of the Petroleum Exporting Countries (OPEC), announced on Saturday that it has curtailed both oil production and refining output after tanker traffic through the Persian Gulf, Starit of Hormuz, came to a near-complete standstill.

The Arab monarchy cited Iranian threats to safe navigation through the Strait of Hormuz as the cause, describing the output reduction as a precautionary measure that would be "reviewed as the situation develops."

Kuwait did not specify the volume of barrels per day being withheld from the market. The state-owned Kuwait Petroleum Corporation, however, sought to reassure global buyers, stating that it "remains fully prepared to restore production levels once conditions allow."

In January, the country was producing approximately 2.6 million barrels per day. The announcement arrives against the backdrop of a staggering rally in crude prices. On Friday, US crude futures logged their largest single-week gain since the contract's inception in 1983 — rising 35.63% to close at approximately ₹7,813 per barrel (West Texas Intermediate).

Read more: https://www.msn.com/en-in/money/economy/kuwait-cuts-oil-production-as-strait-of-hormuz-closure-disrupts-global-energy-markets-what-does-this-mean-explained/ar-AA1XK2N1