Kuwait Petroleum Offers Ship-to-Ship Transfers Outside Hormuz to Buyers, Exports Recover to 50 Percent of Prewar Levels After April Shutdown

Kuwait Petroleum Corporation announced it is offering buyers the option of ship-to-ship transfers outside the Strait of Hormuz for safe transportation to final destinations, Deputy Managing Director for International Marketing Emad A. M. Al-Kandari said at the APPEC industry conference on Wednesday September 9, according to Arab News, Reuters, and Marine Insight. The company is passing some ships through the strait when safe and providing ship-to-ship transfer operations outside the chokepoint as an alternative, Al-Kandari said, though he did not specify which petroleum products were sold under the new arrangement. Documents reviewed by Reuters showed Kuwait Petroleum recently offered naphtha on a delivered ex-ship basis in a handful of tenders in August and September, with some cargoes sold at premiums of up to sixty dollars per ton to Japan quotes on a delivered basis. Kuwait is now exporting about one million barrels of crude per day, including through ship-to-ship transfers outside Hormuz, as oil flows through the waterway recover, Managing Director for International Marketing Shaikh Khaled Al-Sabah told Bloomberg. The company is using its own tankers as well as chartered vessels to move oil. Kuwait's naphtha exports, which averaged about 200,000 barrels per day in the first two months of the year, fell to zero in April and have stabilized at around 50 percent of prewar levels over the past two months, according to shiptracker Kpler data cited by Business Recorder. The shift to delivered-basis sales and ship-to-ship transfers marks a major change in strategy for Kuwait Petroleum, which usually sold naphtha directly at its home ports with buyers managing all shipping risks on their own before the conflict began in February. The move follows similar tactics by other Gulf producers including the United Arab Emirates, Qatar, Saudi Arabia, and Iraq, which are also offering crude to buyers for sale from ports outside the strait. A total of around seven to eight mill