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Iraq in Talks with Opec to Increase its Oil Production Quota

Iraq is in talks with the Organization of the Petroleum Exporting Countries (Opec) to increase its oil production quota, oil minister Bassem Khudair has said.

The higher export ceiling will provide much-needed revenue for reconstruction and economic growth, local media reported the minister saying during his visit to Washington with new prime minister Ali Al-Zaidi.

In June, the oil ministry rejected reports of Baghdad’s plans to withdraw from Opec, instead calling for the reassessment of production quotas in line with the circumstances of member states.

Oil ministry spokesman Salim Al-Rikabi said that Opec and its allies, known as Opec+, had launched a process to assess the sustainable production capacity of member states in coordination with global consultancies.

Opec needs to consider Iraq’s specific security and economic conditions to allow oil production to reach a fair level, he said.

The Iraqi delegation is in Washington to court potential US investors in its energy sector.

“We have tremendous oil partnerships all of a sudden being formed over the last short period of time,” US president Donald Trump said, calling forthcoming deals “massive, among the largest”.

Earlier this month, Opec+ agreed to increase oil production for a fifth consecutive month, a move to defend market share despite lingering geopolitical concerns around the US-Iran war.

The UAE, which was originally part of the voluntary cuts, left Opec in April. Its exports reached a record 3.7 million barrels per day in June, according to Kpler data.

Khudair said that Iraq has formed a consortium with US companies TI Capital and Chevron, and Qatar’s UCC, to develop a proposed oil pipeline to the Syrian Mediterranean port of Baniyas.

This week the Iraqi cabinet approved the signing of preliminary heads of terms and a confidentiality agreement with the consortium, said Al-Rikabi.

Most of Iraq’s oil exports pass through the Strait of Hormuz. The blockade has curbed crude output to just a third of pre-war levels.

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