Iraq revives Syria oil pipeline plan to diversify export routes
Iraq is reviving plans to build a new oil pipeline through Syria to the Mediterranean Sea as part of a series of measures aimed at diversifying its crude export routes away from the Strait of Hormuz.
The country’s cabinet approved a flurry of oil and gas sector decisions over the weekend, including signing a memorandum of understanding with Syria to move forward with the oil pipeline, The National reports.
The project would provide Iraq with a second direct Mediterranean export route, reducing its reliance on Gulf shipping lanes and the disruption-prone Iraq-Turkey pipeline.
Syria has emerged as a key energy transit route for Iraq, with daily truck shipments rising from 10 to 1,000 and 2.1 million tonnes of Iraqi fuel oil transported to Europe since April.
Iraq is also exploring Lebanon as an alternative transit route.
Blackstone to open Kuwait office after $16B oil pipeline deal
Just days after agreeing to participate in a $16 billion oil pipeline partnership in Kuwait, marking the largest foreign direct investment in the country’s history, Blackstone announced it would open an office in the country.
The New York-based alternative asset manager, which already has an office in Abu Dhabi, said it would open its second Gulf outpost in the third quarter of this year via the Kuwait Direct Investment Promotion Authority, Bloomberg reports.
Kuwait Petroleum Company, Blackstone, Brookfield Asset Management and KKR & Co. signed a leasing agreement on Friday for KPC’s crude pipelines, held by subsidiary Kuwait Oil Company, helping to boost the country’s capital sources amid the conflict with Iran.
Blackstone’s commitment to a physical presence in the country comes even as Kuwait, which hosts multiple U.S. military facilities, has faced repeated threats from Iran amid a flare-up of hostilities that started on July 7.
“Kuwait has the resources, vision and leadership to be a key commercial and financial hub in the region,” Blackstone President and Chief Operating Officer Jon Gray said. “Private capital can play an important role to support the country’s long-term economic diversification efforts.”
Growing competition among private equity, private credit and infrastructure investors to win business from the Kuwait Investment Authority has already seen firms including BlackRock, Partners Group and Carlyle Group commit to opening offices in Kuwait.
Energy agency weighs record oil release as Iran tensions mount
Governments around the world are scrambling to contain the escalating shock to energy markets from the Iran war, with oil traders tracking disruptions to Gulf exports and tanker traffic as officials weigh emergency measures to stabilize supplies.
Officials from the International Energy Agency are discussing what could be the largest coordinated release of strategic oil reserves in history – about 300 million to 400 million barrels – far exceeding the 182 million barrels released in 2022 after Russia’s invasion of Ukraine, Bloomberg reports.
Saudi Arabia, the UAE and other Gulf producers are assessing how much crude they can continue exporting as tanker insurers and shipping companies review the risks of operating in the region.
Many cargoes have been delayed and freight rates for vessels willing to enter the Gulf have surged as the conflict intensifies.
At the same time, officials are studying whether alternative routes – including Saudi pipelines that bypass the Strait of Hormuz and export terminals on the Red Sea – can help keep oil moving if shipping disruptions worsen, The Wall Street Journal reports.
The U.S. and its allies are also discussing naval measures to safeguard commercial traffic through the Gulf.
Energy traders say the combination of possible supply outages, tanker disruptions and a record emergency stockpile release has turned the oil market into a day-to-day calculation of how quickly governments can offset the barrels at risk from the conflict.
