Government Of OPEC Heavyweight Kuwait Resigns
The government of Kuwait resigned on Tuesday as the political impasse in one of the largest OPEC producers deepened ahead of a vote of no-confidence in Parliament.
Kuwait’s Prime Minister Sheikh Sabah Khaled Al-Hamad Al-Sabah tendered the government’s resignation today, Kuwait News Agency (KUNA) reported.
The Speaker of the Parliament, Marzouq Ali Al-Ghanim, said that the National Assembly had canceled Wednesday’s session for the no-confidence vote after the prime minister’s resignation. Kuwaiti Crown Prince Sheikh Mishal Al-Ahmad Al-Jaber Al-Sabah received the resignation. The crown prince took over most of the Kuwaiti emir’s duties at the end of 2021.
The political leadership in Kuwait is considering the resignation, KUNA reports. The government was in power for just over three months, and was the third one installed last year amid a political impasse between the government and the elected officials of the Kuwaiti parliament.
The parliament in Kuwait has more powers than similarly structured bodies in the biggest oil producers in the Middle East, including votes of no-confidence against senior members of the cabinet and the power to pass or not pass legislation.
The political constraints in the decision-making in Kuwait prompted Fitch Ratings to downgrade earlier this year Kuwait’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to AA-, from AA.
“There has been a lack of meaningful underlying fiscal adjustment to recent oil-price shocks and the outlook for reforms remains weak, despite some positive political developments as part of a national dialogue. While we assume a debt law will be agreed in 2022, this has been under discussion since 2017, reflecting slow processes for decision-making in Kuwait,” Fitch said in January.
“Political divisions remain, despite the national dialogue, and are likely to prevent broader reform of Kuwait’s fiscal rigidities,” the rating agency added.
Kuwait is currently OPEC’s fourth-largest producer, behind Saudi Arabia, Iraq, and the United Arab Emirates (UAE). In February 2022, Kuwait’s oil production averaged 2.61 million bpd, per OPEC’s secondary sources.
By Tsvetana Paraskova for Oilprice.com
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