Wednesday, December 5, 2018

Iraq’s Oil Exports and Prices Drop In November 2018

(Iraq Oil Report)

Iraq’s oil industry was hit by two bad trends in November 2018. First, bad weather meant its exports dipped. At the same time petroleum prices took a large fall. That offset the good news that Baghdad and Irbil came to a new agreement to allow the Oil Ministry to use the latter’s pipeline to Turkey.

Iraq’s oil exports dropped to a seven-month low in November. The country averaged 3.372 million barrels a day after hitting a series of highs over the previous months. That was the lowest amount since April’s 3.340 million barrels. Previously Iraq had been averaging over 3.5 million barrels a month from June to September, and 3.478 in October. Bad weather hit Basra which hindered tankers from docking and loading Iraqi oil resulting in the dip.

On top of that oil prices took a big hit. International petroleum prices took one of the largest losses in years in November due to increased supply and a decline in demand. For Iraq that meant a barrel of its crude went from $73.38 in October all the way down to $61.09 in November. That was the lowest price since March’s $59.95. Previously oil prices had been slowing creeping upwards and passed the $70 per barrel mark in September. Iraq has been contributing to this situation by exceeding its OPEC quotas and constantly pushing for more exports.

Of course, put those two events together and that led to a nine-month low in revenue. Iraq earned $6.179 billion, the smallest amount since February. Before that the nation had been averaging $7.661 billion a month for six months. Iraq had been hoping the increased earnings would cover its previous budget deficits. It has also talked about large rebuilding projects. The new earnings situation puts a damper on those plans.

The one positive note amongst all this negativity was that Baghdad started using the Kurdish pipeline to Turkey for the first time in a year. There were several different conflicting figures on how much the Oil Ministry was able to send to Turkey. The ministry wants to drastically increase the amount. The United States pushed through this detail to try to keep oil prices down while sanctions were imposed upon Iran. This puts Iraq in a bind however. It wants to continue to increase its oil exports, but it is contributing to the decline in prices.

Federal Oil Exports, Prices, Revenues 2014-2018
Month
Avg Export (Mil)
Avg Price
Earnings (Bil)
Jan 2014
2.228
$102.37
$7.073
Feb
2.799
$102.05
$7.9
Mar
2.396
$101.03
$7.507
Apr
2.51
$100.69
$7.582
May
2.58
$100.69
$8.077
Jun
2.423
$102.96
$7.47
Jul
2.442
$102.27
$7.8
Aug
2.375
$97.44
$7.172
Sep
2.542
$90.76
$7
Oct
2.461
$81.12
$6.19
Nov
2.51
$70.40
$5.238
Dec
2.94
$57
$5.195
2014 Totals
2.517
$92.39
$7.017
Jan 2015
2.535
$41.45
$3.258
Feb
2.597
$47.43
$3.449
Mar
2.980
$48.24
$3.449
Apr
3.077
$51.70
$4.8
May
3.145
$55.87
$5.447
Jun
3.187
$55.32
$5.289
Jul
3.105
$50.99
$4.908
Aug
3.079
$40.59
$3.925
Sep
3.052
$40.32
$3.725
Oct
2.703
$39.56
$3.29
Nov
3.363
$36.42
$3.66
Dec
3.216
$29.84
$2.92
2015 Totals
3.003
$44.81
$4.094
Jan 2016
3.285
$22.21
$2.262
Feb
3.224
$23
$2.249
Mar
3.287
$28.40
$2.894
Apr
3.363
$33.38
$3.368
May
3.2
$37.78
$3.748
Jun
3.175
$40.36
$3.845
Jul
3.203
$38.28
$3.802
Aug
3.229
$29.24
$3.928
Sep
3.276
$38.89
$3.822
Oct
3.384
-
$4.426
Nov
3.47
$40
$4.216
Dec
3.52
-
$5.074
2016 Totals
3.302
-
$3.625
Jan 2017
3.321
-
$5.002
Feb
3.270
-
$4.514
Mar
3.258
$47.18
$4.766
Apr
3.253
$47.27
$4.607
May
3.261
$47
$4.623
Jun
3.273
$42.07
$4.144
Jul
3.230
$43.80
$4.386
Aug
3.216
-
$4.608
Sep
3.24
-
$4.882
Oct
3.346
$52.59
$5.456
Nov
3.502
$59.19
$6.021
Dec
3.535
$59.35
$6.504
2017 Totals
3.309
-
$4.959
Jan 2018
3.490
$63.29
$6.847
Feb
3.426
$60.14
$5.770
Mar
3.453
$59.95
$6.418
Apr
3.340
$64.60
$6.502
May
3.489
$69.80
$7.551
Jun
3.521
$69.32
$7.323
Jul
3.544
$69.16
$7.532
Aug
3.583
$69.65
$7.735
Sep
3.56
$74.15
$7.919
Oct
3.478
$73.38
$7.908
Nov
3.372
$61.09
$6.179

SOURCES

Lando, Ben, Tahir, Rawaz, “November exports decline as global prices drop,” Iraq Oil Report, 12/3/18

Al Mirbad, “More than 101 million barrels of Iraqi oil exports during November,” 12/1/18

Parks, TJ, “Oil Prices Drop 22 Percent In November, The Largest Monthly Percentage Drop In A Decade,” County 17, 12/3/18

Reuters, “Iraq’s southern oil exports at 3.36 million bdp in November: Ministry,” 12/1/18

Rudaw, “Iraq exported over 260k barrels of Kirkuk oil in November,” 12/1/18

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