Kuwait’s KNPC posts record $3.3bn profit amid high oil prices

Jump in income was driven by crude rally and the completion of two refineries

Kuwait, which holds about 8 per cent of the world’s oil reserves, produced 2.7 million barrels per day in 2022, up from 2.42 million bpd a year earlier. AFP

The Kuwait National Petroleum Company has reported a record profit of more than 1.01 billion dinars ($3.32 billion) for the 2022-2023 fiscal year.

The profit was 198 per cent higher than the 341.38 million dinars recorded in the previous fiscal year, state news agency Kuna reported on Tuesday.

The jump in profit was due to higher oil prices and the completion of refineries in Mina Abdullah and Mina Al Ahmadi, Kuna said, citing KNPC chief executive Wadha Al Khateeb.

Kuwait, which holds about 8 per cent of the world’s oil reserves, produced 2.7 million barrels per day in 2022, up from 2.42 million bpd a year earlier, according to Opec data.

The country, Opec’s fourth-largest producer, aims to raise its oil production capacity to 3.15 million bpd in the next four years.

It also plans to increase its natural gas output by about 79 per cent to 930 million cubic feet per day in the same period.

The country has set a refining capacity target of 1.45 million bpd, up from 755,000 bpd currently.

In November, Kuwait Integrated Petroleum Industries said the first phase of Al Zour refinery had begun commercial operations.

The move will be followed by the second and third phases of the refinery's operations, moving towards full maximum refining capacity, Kipic chief executive Waleed Al Bader said at the time.

The refinery is designed to process heavy crudes and will have a capacity of 615,000 bpd.

Kuwait will invest more than $300 billion in the energy sector by 2040, the country’s Oil Minister Saad Al Barrak said at the Opec Seminar earlier this month.

Mr Al Barrak also said that the country hoped to have a higher production quota within Opec after expanding its output capacity.

Similar to other Gulf countries, Kuwait has benefitted from a surge in crude prices following Russia’s invasion of Ukraine last year.

Brent, the benchmark for two thirds of the world’s oil, surged to about $140 a barrel last year after Moscow started its military offensive against Ukraine. It is currently trading at about $83 a barrel.

Oil prices have gained since the announcement of additional production cuts by Opec+ members Saudi Arabia and Russia.

On June 4, Opec+ agreed to keep its current output policy in place until the end of 2024.

The group has total production curbs of 3.66 million bpd, or about 3.7 per cent of global demand, in place, including a two million bpd reduction agreed on last year and voluntary cuts of 1.66 million bpd announced in April.

Opec's revenue from petroleum exports surged 54 per cent last year to its highest level in nearly a decade.

The oil producers' group earned $873.57 billion in 2022, up from $566.44 billion a year earlier, it said in its Annual Statistical Bulletin earlier this month.