Wednesday, December 2, 2020

Iraq Cuts Back On Oil Production Leading To Drop In Exports


Iraq’s oil exports dropped in November. In October the Oil Ministry ordered an increase in production because the government was desperate for cash due to its financial crisis. The next month the country cut back because it’s still supposed to be following an OPEC+ agreement on limiting its output. The result was a decline in exports and revenues.

 

In November Iraq exported an average of 2.709 million barrels a day of oil. That was down from 2.876 million barrels a day in October, which was the highest amount since May’s 3.212 million barrels.

 

For the month Iraqi crude sold for $41.77 per barrel. That was up from $38.48 in October and $40.40 in September. Prices have hovered around $40 per barrel since July after hitting a low mark of $13.80 per barrel in April. That shows that the OPEC+ deal has helped stabilize prices.

 

Despite the rise in prices Iraq earned less money because of its export levels. In November it made $3.395 billion down from $3.457 billion in October. That is still not enough to meet Iraq’s large needs. Government salaries cost an estimated $4 billion a month alone. This is why the country consistently overproduces because it is facing such a dilemma.

 

Federal Oil Exports, Prices, Revenues 2019-2020

Month

Avg Export (Mil)

Avg Price

Earnings (Bil)

Jan 2019

3.649

$56.15

$6.367

Feb

3.621

$60.83

$6.179

Mar

3.377

$63.80

$6.709

Apr

3.466

$67.41

$7.021

May

3.572

$66.68

$7.329

Jun

3.52

$60.58

$6.372

Jul

3.566

$61.15

$6.692

Aug

3.603

$57.41

$6.413

Sep

3.576

$59.14

$6.321

Oct

3.447

$57.15

$6.121

Nov

3.5

$59.82

$6.305

Dec

3.428

$63.05

$6.698

2019 Avgs

3.527

$61.09

$6.543

Jan 2020

3.306

$60.14

$6.163

Feb

3.391

$51.37

$5.053

Mar

3.391

$32.73

$2.962

Apr

3.438

$13.80

$1.51

May

3.212

$21.00

$2.136

Jun

2.816

$33.86

$2.871

Jul

2.763

$40.70

$3.492

Aug

2.597

$43.69

$3.492

Sep

2.613

$40.40

$3.173

Oct

2.876

$38.48

$3.457

Nov

2.709

$41.77

$3.395

2020 Avgs

3.01

$37.99

3.427

 

SOURCES

 

Reuters, “Iraq’s total oil exports average 2.7 million bpd in November: ministry,” 12/1/20

 

Van Heuvelen, Ben and Lando, Ben, “Iraqi oil exports fall as OPEC scrutiny rises,” Iraq Oil Report, 12/1/20

 

Van Heuvelen, Ben, Tahir, Rawaz, Porter, Lizzie, Hussein, Mohammed, “Iraq outlines financial crisis response plan,” Iraq Oil Report, 10/15/20

 

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