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KUWAIT CITY: Kuwait's state oil firm said Wednesday that it expects to restore full production within three days after staff ended a strike in a surprise about-turn that triggered a renewed slide in world prices.
The walkout by thousands of staff of Kuwait Petroleum Corp. and its subsidiaries on Sunday in a dispute over planned pay cuts had slashed the emirate's output from 3.0 million barrels per day to 1.5 million and prompted a brief rally in world prices.
But early on Wednesday the Kuwait Oil Workers Union announced that its members were returning to work after what it called an "extremely successful" strike that had made the government pay attention to their concerns.
The surprise announcement, which came just hours after union leaders had vowed to continue the strike until all their demands were met, quashed hopes the disruption could help ease a persistent supply glut and saw oil shed nearly a dollar in Asian trade.
At around 0730 GMT, US benchmark West Texas Intermediate for May delivery was down 99 cents, or 2.41 percent at $40.09 a barrel while Brent crude for June fell 98 cents, 2.23 percent, to $43.05.
KPC spokesman Sheikh Talal Khaled Al-Sabah said that staff were already returning to work in response to the union's call and that operations at the company's installations were resuming.
A gradual return to normal production of 3.0 million bpd "would take around three days," he said.
The climbdown by the union came after an appeal by acting oil minister Anas al-Saleh on Tuesday night for staff to return to work so that negotiations could be held on their demands.
"We cannot sit at the negotiating table while the strike is still going on. Return to work and come and negotiate," he told the private Al-Rai satellite television.
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