Strike by Kuwait oil workers slashes output

KUWAIT CITY, April 17, 2016 (AFP) – Thousands of Kuwait’s oil workers began an open-ended strike on Sunday in protest at plans to cut their wages, action which saw the emirate’s crude production plunge.

A spokesman for the Kuwait Oil Co. (KOC), Saad al-Azemi, said on Twitter that “average production reached 1.1 million” barrels in Kuwait on Sunday.

Daily production in OPEC’s fourth largest producer is normally around 3.0 million barrels per day.
Azemi also said natural gas production was at 620 million cubic feet, down from Kuwait’s daily average of more than 1.3 billion cubic feet.

The strike comes as world oil producers gathered in Qatar aiming to negotiate an output freeze to boost prices.
“Thousands of workers began their strike,” the oil workers union chief Saif al-Qahtani told AFP, adding that production had been partly halted but without clarifying which sites were affected.

“Observed since 7:00 am (0400 GMT), this open-ended strike will continue until the workers’ demands are met,” Qahtani said.The cabinet strongly criticised the “unacceptable” strike, calling it a “clear violation of the law”, and demanded legal measures against those involved.

The government also urged Kuwait Petroleum Corp (KPC) to mobilise the manpower needed to ensure continued production.

On Saturday, the union turned down an appeal from Kuwait’s acting oil minister, Anas al-Saleh, to call off the strike.
Hit by the sharp drop in crude prices on world markets, Kuwait is introducing a new payroll scheme for all public employees and wants to include the country’s 20,000 oil workers, which would mean an automatic cut in wages and incentives.

As the strike began, KPC spokesman Sheikh Talal Khaled al-Sabah said that the national oil conglomerate had activated an “emergency plan” to ensure that local and international markets were not affected by the walkout.
“Export operations are going ahead as planned and (KPC) is capable of responding to major international market demands, based on agreements with clients,” he said in a statement published on the KUNA news agency’s website.
The plan ensures that all petrol stations will continue to be supplied, as will Kuwait’s international airport and companies operating there, he said.

He urged Kuwaitis “not to listen to rumours that the strike has affected the needs of the local market”.
He said reserves of gasoline and petrol derivatives were “enough to meet the country’s demands for 25 days and strategic reserves could suffice for 31 more days”.

KPC had offered to suspend all spending cuts if the union agreed to join a committee to negotiate a settlement, but said workers had boycotted negotiations called for Thursday by the social affairs and labour ministry.
The union is also protesting against plans to privatise parts of the oil sector.