Key Takeaways:
Kuwait Petroleum Co. issued its first spot tender for port-loaded naphtha in five months, the clearest signal yet that Gulf energy supply chains are recovering after the US-Iran conflict.
Kuwait Petroleum Co. issued its first spot tender for naphtha loaded from Kuwaiti ports since the US-Iran war began, offering 55,000 to 80,000 metric tonnes for July 5-6 delivery as Gulf export channels reopen.
"This is the first tangible sign that Kuwait's export infrastructure is returning to normal operations after the Hormuz disruption," said a Gulf-based oil trader with direct knowledge of KPC's marketing operations.
The tender, with bids due June 22, marks the resumption of direct port-based sales after a roughly five-month hiatus. KPC's previous port naphtha tender was in January for February loading. During the interruption, the state producer relied on ship-to-ship transfers at India's west coast, offshore Oman, and Fujairah storage to supply customers. The restart follows KPC's decision Thursday to lift all force majeure notices issued during the war.
The normalization of Kuwaiti port operations adds to a wave of supply returning to global markets. Iraq is preparing to export 50,000 barrels per day of crude through Syria's Baniyas port from July, while three Saudi-flagged tankers carrying 6 million barrels of crude have already transited the Strait of Hormuz after the US-Iran interim deal was signed June 18. Brent crude traded at $80.36 a barrel Friday, down about 8% for the week, as traders priced in the return of stranded supply.
The KPC tender specifically targets the Asian naphtha market, where petrochemical buyers in Japan, South Korea and China have been sourcing alternative supplies at higher freight costs during the disruption. Naphtha is a key feedstock for ethylene crackers, and the resumption of direct Kuwaiti port loading reduces the logistical complexity and cost of delivery.
Supply recovery accelerates across the Gulf
Kuwait's move is part of a broader regional normalization. Iraq's oil ministry said it would maintain diversified export routes — including through Syria — even after Hormuz fully reopens, as part of a government-approved strategy to reduce reliance on a single corridor. Iraqi Oil Minister Basim Mohammed said oilfields are ready to resume production and output will gradually return to normal.
Syria, under President Ahmed al-Sharaa, is expanding its Baniyas port facilities to handle Iraqi crude and naphtha, earning transit fees as it seeks to reintegrate into the regional economy after nearly 14 years of war. The port can now unload an average of 900 tanker-trucks per day, Syrian Petroleum Co. said.
Risks remain despite reopening
The recovery remains fragile. Switzerland called off US-Iran talks scheduled for Friday after Vice President JD Vance dropped his travel plans, while Israel continued its campaign against Hezbollah in Lebanon. Analysts expect the interim deal to release more than 85 million barrels of oil stranded in the Middle East Gulf, but the pace of normalization depends on whether the truce holds.
"Traders are still waiting for hard evidence that tanker traffic through the Strait of Hormuz is actually normalizing before committing to the next leg lower," said Tim Waterer, chief market analyst at KCM.
This article is for informational purposes only and does not constitute investment advice.
