Asia oil markets eye Kuwait Al Zour’s exports as final CDU starts up

Asia oil markets eye Kuwait Al Zour’s exports as final CDU starts up

SINGAPORE - Oil markets in Asia are bracing for further growth in exports from Kuwait's newest Al Zour refinery as the complex started up its third and final crude distillation unit (CDU) this week, with trade sources saying the full impact was likely to be felt later in the third quarter as it ramps up operation. The refinery, which first started commercial operations in November 2022, is one of several major facilities globally bringing capacity online this year, with higher production and exports of oil products expected to weigh on refining margins. With Al Zour operational, Kuwait's exports of refined products, including fuel oil, diesel, jet fuel and naphtha, hit a monthly record high of 2.8 million metric tons in June, data from analytics firm Kpler showed. Al Zour has been stepping up its fuel oil tenders since end-2022, with a significant share of its products landing in Asia and the Middle East and putting margin pressure on rival refiners. Most of the very-low sulphur fuel oil (VLSFO) exports were headed to key bunker and transfer hubs Singapore and UAE's Fujairah, based on Refinitiv and Kpler shiptracking data. For jet fuel, Al Zour's exports have averaged 50,000 tons to 200,000