Kuwait’s refining power surges with 48% growth over 10 years

• The Middle East is already competing with the Al-Zour refinery, which has a capacity of 615,000 barrels per day, the 230,000-barrel Duqm refinery in Oman, and the 140,000-barrel Karbala refinery in Iraq.

Data published by S&P Global Community Insights revealed that Kuwait’s refining capacity has increased by 48 percent over the past decade (2014-2024), making it the third-largest refiner in the Middle East this year, after Saudi Arabia and Iran, according to Al Rai newspaper.

The data also showed that Kuwait ranked third in the region for exports of refined petroleum products this year.

The Middle East’s oil refineries, which feature new production capacity and some of the world’s most efficient plants, are preparing to ignite competition in 2025. This comes as the expansion of Bahrain’s BAPCO refinery is set to begin increasing production capacity in the first quarter of next year, according to the agency.

S&P Global Communications Insights highlighted that the Middle East is already competing with the Al-Zourrefinery, which has a capacity of 615,000 barrels per day, the 230,000-barrel Duqm refinery in Oman, and the 140,000-barrel Karbala refinery in Iraq.

The BAPCO refinery’s production capacity is set to increase from 267,000 to 380,000 barrels per day. The pre-operational phase of this expansion will begin in the first quarter of next year. BAPCO declined to provide an update at this time.

Modernizing the refineries

The International Monetary Fund (IMF) stated following bilateral talks on November 22 that modernizing the refineries would help boost Bahrain’s economy next year.

For his part, Dong Wang, senior oil analyst for the Middle East at S&P Global Commodity Insights, stated that improvements in refining margins in 2025 may be supported by potential delays in the schedules of some projects, as evidenced by the challenges faced by the Dangoti and Olmica refineries.

In contrast, the BAPCO refinery expansion project is expected to impact the country’s exports of refined products by the third quarter, with production of gasoline and diesel projected to increase by 20 percent from the previous year, according to Balash Jane, an oil analyst for the Middle East at consulting firm FGE.

Jane also projected that Oman’s Duqm refinery will operate about ten percent above its nominal capacity by late 2025, and Iran’s Siraf refinery is scheduled to complete the expansion of one of its 60,000-barrel-per-day condensate units in the second half of the year.

New refineries to boost Middle East crude oil processing by 300,000 barrels per day by 2025

He expects that new refineries will contribute to increasing crude oil processing capacity in the Middle East by about 300,000 barrels per day by 2025, reaching a record average of 9.7 million barrels per day.

Analysts at S&P noted that the Al-Zour refinery, with a capacity of 615,000 barrels per day, is operating at about 75 percent of its capacity due to “limited crude allocations” from its parent company, Kuwait Petroleum Corporation.

UAE region’s largest hub for fuel oil exports

While the United Arab Emirates (UAE) remains the region’s largest destination for fuel oil exports, the United States has risen in the rankings, becoming one of the four largest destinations for fuel oil exports from the Middle East so far this year, according to the agency’s data.

The data also showed that the UAE is on track to become the largest destination for other refined products this year, having surpassed South Korea last year.

Jane also mentioned that the closure of refineries outside the region could lead to increased demand for supplies from the Middle East.