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OPEC+ Proposes 1-Million-Bpd Production Increase

OPEC+ Proposes 1-Million-Bpd Production Increase

The joint ministerial monitoring committee…

Kuwait Petroleum In Talks To Set Up Trading Joint Venture

offshore oil rig

Kuwait’s state-run Kuwait Petroleum Corp (KPC) is discussing a joint venture with commodities traders or international oil companies to start trading refined oil products, Bloomberg reports, citing an official at KPC.

The Kuwaiti company is in talks with BP, Shell, and Total, as well as with commodity trading giants Vitol and Glencore regarding a possible joint venture. According to the KPC official, the energy trade joint venture would market fuel from refineries that KPC is building, including the 230,000-bpd Duqm Refinery and Petrochemical Complex in Oman, in which Kuwait Petroleum and Oman Oil are partners.

Kuwait Petroleum’s push into trading is the latest national oil company from the Middle East region that is seeking to expand into oil products trading.

Saudi Aramco launched Aramco Trading Company (ATC) in 2012 as a wholly owned subsidiary that would trade refined, liquid chemical, and polymer products.

Oman launched Oman Trading International (OTI) in 2006 as a joint venture between Oman Oil Company (OOC) and Vitol, to trade oil, petroleum products, and petrochemicals globally. In November 2015, Vitol’s shareholding in OTI was transferred to the State General Reserve Fund – meaning OTI is now 100-percent held by the Government of the Sultanate of Oman.

Related: New Tanker Regulations May Impact Oil Prices

Litasco, the international oil trading company of Russia’s Lukoil, and Iraq’s state oil marketing firm SOMO have also recently created a joint oil trading company based in Dubai.

According to analysts who spoke to Bloomberg, the entry of state companies from the Middle East into trading may increase competition for independent commodity traders and put pressure on margins. However, the state companies are still very much focused on supplying their key markets with oil, so independent traders will continue to play a role in trading in the Middle East.

By Tsvetana Paraskova for Oilprice.com

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