The peace agreement between Iran and the United States has brought a tailwind into Kuwait’s energy industry, with the latter’s crude oil production rising sharply to 1.65 million barrels per day in June from 580,000 bpd in May, with the OPEC member also boosting its exports through the Gulf routes.
The jump in Kuwaiti crude oil output also indicates that energy trade, the lifeline of the Middle East’s key economies, through the Strait of Hormuz is recovering rapidly following disruption caused by the Iran war, with stranded cargoes gradually clearing the strategically important maritime chokehold and exporters restoring production.
It is worth mentioning that around USD 600 billion in energy trades used to pass through the Strait of Hormuz on an annual basis till the beginning of 2026. This key water route daily handles about 20 million barrels of crude oil and petroleum and up to 20% of global liquefied natural gas (LNG).
Kuwait was producing a crude volume of 2.5 million bpd before Iran’s closure of the Strait in response to the American and Israeli airstrikes at the end of February. The disruption prompted the country and other Gulf producers like Saudi Arabia and Iraq to cut millions of barrels per day of oil output.
With the war now coming to an end and things normalising at the Hormuz, daily production in the last 10 days of June rose to as high as 1.9 million bpd, claimed a Reuters report. As oil production and trade recover quickly, it has directly affected the crude price, with the Brent futures and West Texas Intermediate (WTI) trading at USD 71.87 and USD 68.63, respectively.
State oil company Kuwait Petroleum Corporation has already lifted all force majeure notices issued during the war, while a tender document on June 19 showed the company offering cargoes to buyers.
The recovery in energy flows augurs well for Kuwait, which was one of the hardest-hit countries in the Gulf by the Iran war due to the closure of the Strait of Hormuz. Unlike Saudi Arabia and the United Arab Emirates (UAE), which can use export routes other than the Strait, Kuwait relies almost entirely on the waterway for its crude exports, leaving it effectively cut off from key markets such as Asia during the disruption.
Leaving behind the war-related disruptions, Kuwait Petroleum Corporation (KPC) is now focusing on raising fresh capital by asking global funds bidding for a USD 7 billion stake in its oil pipeline network to recruit other investors to help consolidate bids. The rule tweak, as per the reports, has been done to ensure that smaller investors that have relationships with KPC can get involved in the process. KPC, following the lead of its other Gulf counterparts and sovereign investors, is looking to raise funds from infrastructure assets and attract foreign capital, with the goal of diversifying away from oil and funding domestic investment plans.
Among the bidders, Blackstone has emerged as the prominent name. For the first time, the world’s largest alternative asset manager has taken part in a wave of Gulf national oil company infrastructure deals that have also attracted rivals like BlackRock and its Global Infrastructure Partners (GIP), as well as KKR and others.
Saudi Aramco, Abu Dhabi’s ADNOC and other regional energy companies have pursued similar asset strategies in recent years. Aramco has already signed an USD 11 billion lease and leaseback deal for its Jafurah gas processing facilities with a consortium of funds managed by GIP in a deal that got closed in October 2025.
BlackRock’s GIP, Brookfield, EIG Global Energy Partners, KKR and Apollo have also advanced to the KPC’s next stage of the sales process. KPC launched the transaction in the early stages of the Iran war, indicating the Gulf nation’s strong intent to press ahead with its fundraising plans despite the geopolitical volatility.