The chief executive of Kuwait’s state oil company said a US$30 per barrel “war premium” has been built into the cost of oil. 

“I see a war premium of about US$30 in the price right now,” Kuwait Petroleum Corp.’s Sheikh Nawaf Al-Sabah told Bloomberg TV on the sidelines of the Qatar Economic forum on Tuesday. There’s little sign of demand destruction in oil markets because of high prices, although growth is slowing.

Oil prices have soared almost 50 per cent this year to around US$110 a barrel, mainly because of the fallout from Russia’s invasion of Ukraine. Exxon Mobil Corp. said Tuesday in Doha oil markets may remain tight for three to five years largely due to under-investment since the pandemic began.

Kuwait Petroleum’s CEO also said European buyers are asking about more refined oil from the country, partly in anticipation of its Al Zour refinery coming fully onstream. “We’re getting more calls for products,” he said. “By the end of the year, we’ll have about 615,000 barrels of oil a day being converted into mostly diesel and very low sulphur fuel oil.”

Qatar’s Ministry of Commerce and Industry, Qatar Investment Authority and Investment Promotion Agency Qatar are the underwriters of the Qatar Economic Forum, Powered by Bloomberg. Media City Qatar is the host organization.