The Organization of the Petroleum Exporting Countries and its allies (OPEC+) have significantly increased their refined fuel exports, offsetting the impact of their crude production cuts as members seek to boost revenues and expand market share.
According to industry data from Kpler and OilX, seaborne fuel exports from key Gulf OPEC+ members—Saudi Arabia, Iraq, Kuwait, Oman, and the United Arab Emirates (UAE)—reached a record 5.51 million barrels per day (bpd) in 2024, reflecting a 7% increase from the previous year.
Andon Pavlov, an analyst at Kpler suggested that this surge in refined product shipments allows oil producers to bypass crude production limits while maximizing financial gains.
“A lot of countries just realize that you can make a lot more money by selling refined products rather than exporting crude.”
Andon Pavlov, an analyst at Kpler
The rise in refined fuel exports exposes a key structural aspect of OPEC+ agreements—while they restrict crude oil production, they do not directly regulate the export of refined petroleum products such as gasoline, diesel, and jet fuel.
This means that countries with sufficient refining capacity can continue to sell more oil-derived fuels without breaching their OPEC+ commitments.
Rystad Energy analyst Mukesh Sahdev said, “In equivalent crude terms, more oil is reaching the market than required,” explaining how the higher refined fuel supply reduces the real-world impact of crude oil production cuts.
OPEC+ members are currently holding back approximately 5.85 million bpd of crude output—around 5.7% of global demand—as part of a series of production curbs implemented since late 2022.
However, with rising refined product exports, the net reduction in oil reaching global markets is significantly lower than the headline figures suggest.
One of the key enablers of this strategy is the significant investment made by Gulf OPEC+ members in refining capacity over the last decade. Between 2009 and 2023, Iraq, Kuwait, Saudi Arabia, and the UAE expanded their combined domestic refining capacity from 6.5 million bpd to 9.1 million bpd.
OPEC projects further global refining capacity growth of 6.3 million bpd by 2029, driven primarily by expansions in the Middle East, Asia Pacific, and Africa.
This increased refining capability has helped offset the impact of crude export reductions. Seaborne crude exports from the five major Gulf producers fell by 713,000 bpd in 2024, in line with OPEC+’s 2.2 million bpd production cut agreed last year.
However, a 374,000 bpd rise in refined fuel exports partially compensated for the crude export decline.
Strategic Gains for OPEC+
Analysts suggest that Gulf OPEC+ producers have deliberately pursued a strategy of expanding their refining footprint to strengthen their long-term market position.
By exporting refined products instead of crude oil, these countries can diversify their customer base and capture more value across the supply chain.
“When you are both a crude producer and a refiner, then you can supply the world: You can sell your LPG and naphtha to Asia, gasoline to Africa and Latin America, and diesel and jet fuel to Europe.”
FGE Energy analyst Iman Nasseri
Beyond domestic refining expansions, Gulf OPEC+ members have also increased their international refining and downstream investments.
In 2022, Saudi Aramco acquired a 30% stake in Polish refiner PKN Orlen’s Lotos plant and expanded its refining partnerships in China, the world’s largest oil importer.
Similarly, Abu Dhabi National Oil Company’s (ADNOC) investment arm, XRG, purchased a majority stake in German chemicals firm Covestro, further strengthening its global presence.
The trend of increased refined fuel exports is unlikely to slow down anytime soon. With further refinery projects in the pipeline, Gulf OPEC+ producers are expected to maintain high levels of fuel exports, particularly as they prepare to unwind a portion of their latest crude production cuts in April 2024.
As the global energy landscape continues to evolve, OPEC+’s ability to adapt its strategy—shifting focus from crude exports to refined fuels—ensures its continued influence over oil markets.
While production cuts may give the appearance of tightening supply, the reality is that Gulf OPEC+ members are leveraging their refining investments to keep oil and fuel flowing, ensuring both revenue growth and long-term market control.
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