Kuwait Hopes to Resolve the Neutral Zone Issue

Kuwait Hopes to Resolve the Neutral Zone Issue

Khaled Al Fadhel, Kuwait’s Minster of Oil, expressed his hopes to resolve the Kuwait-Saudi Arabia Neutral Zone issue by the end of 2019, according to Reuters.

Oil production in the Khafji and Wafra jointly-run oilfields in the Neutral Zone has been halted by the two countries for more than three years, which resulted in cutting about 500,000 barrels per day (b/d) of heavy crude oil, around 0.5% of global oil supply.

“We hope that by the end of the year things will be cleared out and things will go back to normal,” Al-Fadhel told reporters on the sidelines of a Kuwaiti conference.

According to sources familiar with this issue, an agreement was expected to be signed by the two countries on December 24 in the Kuwait City to resume production in the Neutral Zone. However, this issue is a political one that requires further discussions at higher levels.

Kuwait’s Deputy Foreign Minister, Khaled Al-Jarallah, has hinted in October that negotiations between the two countries on the Neutral Zone looks promising, and that an agreement has been reached. Moreover, a source also stressed that once signing the agreement between the two countries, production plans would be done in phases and it would take months for output to return to its full capacity.

 

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