Fears of possible supply disruptions from Iran and political tensions across the Middle East have helped to drive up the price of benchmark Brent crude oil, which is trading at just under $126 a barrel.
“Under the supply and demand theory, oil prices today are not justified,” Oil Minister Hani Hussein said in the televised interview.
Many producers fear high oil prices could damage demand by crimping growth in consuming countries. Brent crude prices shot to an all-time high in dollars of over $147 a barrel shortly before the global financial crisis of 2008.
Hussein said Kuwait was producing around 3 million barrels of oil a day, near the country’s capacity. It was aiming to raise daily production to 4 million barrels by 2020, he said.
“Kuwait’s current level of production will not affect the country’s level of strategic reserves,” he said.
Hussein also said he hoped Iran would not close the Strait of Hormuz waterway that is vital for ships carrying the region’s oil, but reiterated that Kuwait had a “strategic plan” should this happen. He did not provide details.
Some Iranian officials have threatened a closure of Hormuz in retaliation to new Western sanctions over the Islamic Republic’s nuclear program.
Western powers have been trying to raise pressure on Tehran by stemming Iran’s oil exports and some Gulf OPEC producers, including Kuwait, have said they are ready to meet any increase in demand for oil.
Hussein added that there may soon be a result in a case Dow Chemical has brought against state-run Kuwait Petroleum Corp. after the Gulf state canceled a $17.4 billion proposed joint venture in 2008. There was a possibility Kuwait would be fined, he said.
