Saudi Arabia and Kuwait Announce New Oil Find

Saudi Arabia and Kuwait have just announced a major oil discovery in the Partitioned Neutral Zone, the first significant find since they resumed joint operations there in 2020.

According to Saudi state news agency SPA, the new reserve was found in the North Wafra Wara-Burgan field. The discovery well is located around five kilometres north of the Wafra field and is producing more than 500 barrels of crude oil per day.

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“This marks the first discovery since the resumption of production operations in the partitioned zone and its adjacent offshore area in mid-2020,” SPA said.

This latest find is being called a “highly significant” development, boosting both countries’ reputations as reliable energy suppliers and showing their strength in exploration and production.

Why This Matters

The neutral zone sits between Saudi Arabia and Kuwait and is home to two major oilfields: Wafra (onshore) and Khafji (offshore). Both were shut down in 2014 and 2015, but restarted production in July 2020 after the two countries signed a 2019 agreement to split production and jointly manage operations.

Energy experts say the area could add up to 500,000 barrels per day to global supply, a meaningful boost as the world continues to need new sources of oil to meet rising demand and replace aging wells.

More Discoveries in the Region

This is just the latest in a string of oil and gas finds in the region:

• Last month, Saudi Aramco announced it had discovered 14 new oil and gas fields across the Eastern Province and the Empty Quarter.
• In 2024, Kuwait discovered “huge commercial quantities” of oil and gas at Al Nokhatha field near Failaka Island with potential reserves of over 3 billion barrels of oil equivalent.

All of this comes at a time when oil prices are under pressure due to global economic uncertainty, concerns about oversupply, and changing energy policies. But analysts believe these discoveries highlight the long-term strategic energy value of the Gulf region.

Market Impact and Outlook

Brent crude, the international benchmark, was trading at around $64.82 a barrel, while West Texas Intermediate was at $61.56 at the time of the announcement. Prices have fluctuated this year due to shifting demand forecasts and Opec+ production decisions.

Looking ahead, Saudi-based Jadwa Investment expects Saudi crude output to reach 9.4 million barrels per day in 2025, up from 9 million in 2024. While prices are expected to stay in the $63 - $65 per barrel range, higher volumes could help offset the impact of lower prices.

The Big Picture

While the global transition to cleaner energy is underway, it’s moving slowly. In the meantime, new oil discoveries like this one in the neutral zone give Saudi Arabia and Kuwait an edge, reinforcing their positions in the global energy market and strengthening their energy security.

This article was previously published on saudimoments. To see the original article, click here