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By Nidhi Verma
NEW DELHI, March 15 (Reuters) - Kuwait has asked some
Asian refiners to take less oil under their annual deals as the
OPEC producer hopes to start full-scale operations at its Al
Zour refinery later this year, three refining sources familiar
with the matter said.
Lower supplies from Kuwait could tighten Middle East
supplies to Asia and support prices especially as demand from
China, world's top crude importer, is expected to rebound this
year.
KPC has informed some buyers that Kuwait Export Blend crude
supply may be reduced under new annual contracts starting in
April, sources at two Indian refiners and one Japanese refiner
told Reuters.
Indian Oil Corp , the country's top refiner, will
reduce its yearly oil purchase from Kuwait by 20%, or 20,000
bpd, starting in April, according to one of the persons with
knowledge of the situation.
The second Indian refining source said Kuwait has also
approached his firm asking them to take less oil under next
fiscal year's term contract from April.
KPC did not respond to a request for comment.
Kuwait has started up the second phase of the Al Zour
refinery, Waleed Al-Badr, chief executive of Kuwait Integrated
Petroleum Industries Company, a subsidiary of Kuwait Petroleum
Corporation, said last week.
The 615,000 barrel-per-day (bpd) refinery has three CDUs
with equal capacity. Consultancy FGE expects a third crude
distillation unit at Al Zour to come online by August.
The Japanese refining source did not disclose how much
volume KPC was looking to cut, but added that KPC has also
contacted other refineries in Japan to negotiate supply
reductions.
To make up for less oil from Kuwait, India's IOC has
increased its term crude volume with Iraq's Oil Marketing
Company (SOMO) by 20,000 bpd, the first source said.
IOC would be lifting 210,000 bpd oil from Iraq in 2023
compared with 190,000 bpd in 2022, he said.
Iraq's SOMO and IOC did not respond to a request for
comment.
Annual crude sales contracts between Iraq, the largest crude
supplier to India, and most Indian refiners start from January.
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(Reporting by Nidhi Verma in New Delhi and Muyu Xu in
Singapore; Editing by Florence Tan and Kim Coghill)
Messaging: nidhi.verma.thomsonreuters.com@reuters.net))
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