HORMUZ CRISIS REDUCED PERSIAN GULF OIL PRODUCTION BY OVER 6MLN BPD - ARGUS

MOSCOW, March 17 (Bernama-Sputnik/RIA Novosti) -- The Persian Gulf countries have reduced production by 6.2 to 6.9 million barrels of oil per day altogether due to the crisis in the Strait of Hormuz, according to estimates from the pricing agency Argus, reported Sputnik/RIA Novosti.

Saudi Arabia, the United Arab Emirates (UAE), and Bahrain have followed Iraq and Kuwait in restricting production due to their inability to maintain exports following the effective closure of the Strait of Hormuz, and this situation has led to the rapid filling of existing storage facilities, it said.

For this reason, the countries have had to reduce oil production by 6.2 to 6.9 million barrels per day (bpd) compared to February, according to Argus estimates.

Saudi Aramco, the state-owned oil company, has suspended operations at the Safaniya, Marjan, Zuluf, and Abu Safa offshore fields, according to sources. Argus estimates this will reduce production by 2-2.5 million bpd.

According to sources, Iraqi production was 4.42 million bpd in February, but by March 8 it had fallen to 1.5-1.7 million bpd and is expected to decline further to 1.2-1.3 million bpd.

Kuwait has also begun cutting oil production. The Kuwait Petroleum Corporation (KPC) announced on March 7 that it had begun reducing oil production and refinery utilisation. Furthermore, according to a KPC trading notice seen by Reuters, the company declared force majeure for crude oil and petroleum product deliveries. Kuwait's production has already fallen to around 2 million bpd from 2.59 million bpd in February and could soon decline to around 1.5 million bpd due to reduced refining capacity, a source told Argus.

ADNOC, the national oil company of the UAE, announced on March 7 that it was continuing operations as usual amid shipping problems in the Strait of Hormuz, using other export options. However, Argus sources believe that UAE production has fallen to 2.7-3 million bpd from 3.53 million bpd in February.

Bahrain's Bapco oil company declared force majeure on March 9 following explosions at its refinery, the state news agency BNA reported. The refinery's production capacity is 405,000 bpd.

On February 28, the US and Israel began striking targets in Iran, including Tehran, causing damage and civilian casualties. Iran is retaliating with strikes on Israeli territory, as well as on US military targets in the Middle East.

The escalation around Iran has led to the effective blockade of the Strait of Hormuz, a key route for oil and liquefied natural gas supplies from the Persian Gulf to global markets and has impacted oil exports and production in the region.

--BERNAMA-SPUTNIK/RIA NOVOSTI