2024-04-03T16:35:15+00:00
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/ Iraq once again failed to adhere to the oil production target set by OPEC+ last March, which may put it under further scrutiny, at a time when the coalition is preparing to review the country’s supply plan.
Iraq, the second largest producer in OPEC, pumped 4.17 million barrels per day last month, that is, 30 thousand barrels per day less than it was in February, according to a survey conducted by the American “Bloomberg” agency, and viewed by Agency.
While this is the lowest production level for Iraq this year, it is still about 170,000 barrels more than the level that was committed to as the coalition restricted production to support the market.
Oil Minister Hayan Abdul Ghani said last month that the country would reduce production and exports after exceeding its production quota in January and February.
Slight decrease
During the OPEC+ committee meeting on Wednesday, Iraq again pledged to “achieve full compliance as well as compensate for excess production,” according to a statement issued after the talks. A detailed plan is expected to be presented by the end of April.
Iraqi production has been the subject of discussion in recent months. OPEC data shows that the country has exceeded the production target agreed upon with the group since July. Baghdad, which has a long history of not achieving full production compliance, said it was committed to voluntary cuts.
Iraq’s crude oil exports decreased by 7% last month to 3.15 million barrels per day, an indication that the country is reducing its participation in the international market, according to Bloomberg’s tracking of oil tankers. This is less than the 3.3 million barrels per day the country was aiming to ship.
Refining
Iraq expanded local refining operations, enhancing fuel processing capacity to more than one million barrels per day, with the aim of eliminating fuel imports.
OPEC and its allies agreed to keep current production targets as they are until at least the end of June. This puts Iraq’s production target at around 4 million barrels per day.
Along with Iraq, the UAE and Gabon have also exceeded their set levels, collectively pumping several hundred thousand barrels per day above their agreed-upon quotas.
Geopolitical obstacles
However, joint efforts by OPEC and its partners have helped support crude oil prices, which are now at their highest levels this year, keeping prices near $90 per barrel. Supply cuts, coupled with strong fuel demand in the United States and elsewhere, keep global markets constrained despite increased production from the Americas.
Iraq exceeded its quota even with the closure of its second most important export line. The country has not exported any crude from its northern fields via pipeline to the Mediterranean coast since Turkey halted flows to the port of Ceyhan at the end of March last year.
This ongoing stalemate, which does not appear to be resolved soon, also includes a dispute over payments owed to international producers working in the semi-autonomous Kurdistan Region, and production restrictions do not constitute an incentive for Iraq to resolve this issue.