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Kuwait-Saudi Arabia on 'Neutral Zone' oil output

Crude oil pipeline
Crude oil pipeline [File photo]

Kuwait and Saudi Arabia are still in talks on resuming oil production from jointly operated in the Neutral Zone, the Kuwaiti deputy foreign minister announced yesterday.

Speaking to local Kuwaiti reporters, Khaled Al-Jarallah said that the joint negotiations with Riyadh were “very positive.”

“When the final deal about this zone is reached, the two countries will start discussing the resumption of the oil production,” official KUNA quoted Jarallah as saying.

Well-informed source on the Neutral Zone’s oil operations told Reuters that restarting production from the joint fields once a final agreement has been reached would be done “in phases.” They noted that it would take “months for the output to return to its full capacity before the closure of the fields.”

“Any increase in oil production from the zone will be compensated by a supply cut from other fields by both Saudi Arabia and Kuwait as both countries are committed to their targets under the so-called OPEC+ oil output reduction agreement,” the sources added.

The closure of the fields had been a political dispute between the two Gulf countries. Senior officials have been trying to resolve the issue for months. Oil output in the Neutral Zone, which dates back to 1920s treaties establishing regional borders, is divided equally between Saudi Arabia and Kuwait.

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