Tuesday, April 9, 2024

Iraq Continues To Flaunt OPEC+ Production Cuts


In January Iraq was supposed to institute OPEC+ production quotas. Not only did it not do so but its exports increased. Baghdad promised to comply but it has never followed any of the recent agreements.

 

In March Iraq produced an average of 4.17 million barrels a day of oil. That was 30,000 barrels a day less than February but still 170,000 barrels over its quota. Not only that but the Oil Ministry was fibbing its numbers by not including oil production in Kurdistan.

 

As a sign of its non-compliance Iraq’s oil exports were higher in February and March than January when the OPEC+ deal was to go into effect. In January Baghdad exported an average of 3.339 million barrels a day. That went up to 3.434 million barrels in February and only slightly decreased to 3.423 million in March.

 

The reason why Iraq has always cheated is because it is the most oil dependent country in the world. Over 90% of the government’s revenue is based upon exports and the economy is dominated by the state. It therefore cannot afford to seriously cut back its production or sales.

 

The Oil Ministry has not publicized full figures for the last two months. Iraq Oil Report however estimated that Iraq earned $8.68 billion in March and $7.96 billion in February. This is especially needed now as Baghdad just increased its budget which was already the largest in history.

 

Federal Oil Exports, Prices, Revenues 2020-2022

Month

Avg Export (Mil)

Avg Price

Earnings (Bil)

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

$3.404

Dec

2.846

$47.76

$4.235

2020 Avg

2.996

$38.80

$3.493

Jan 2021

2.868

$53.29

$4.765

Feb

2.96

$60.33

$5.013

Mar

2.946

$63.32

$5.787

Apr

2.947

$62.77

$5.549

May

2.899

$65.84

$5.917

Jun

2.892

$70.77

$6.143

Jul

2.918

$72.00

$6.476

Aug

3.054

$69.01

$6.553

Sep

3.081

$73.32

$6.777

Oct

3.12

$79.27

$7.666

Nov

3.272

$77.33

$7.611

Dec

3.277

$72.80

$7.391

2021 Avg

3.019

$68.33

$6.303

Jan 2022

3.203

$83.82

$8.323

Feb

3.314

$92.08

$8.544

Mar

3.244

$110.09

$10.913

Apr

3.38

$104.09

$10.554

May

3.3

$111.79

$11.44

Jun

3.373

$113.70

$11.505

Jul

3.303

$103.60

$10.608

Aug

3.286

$96.05

$9.784

Sep

3.292

$89.56

$8.845

Oct

3.382

$88.31

$9.258

Nov

3.329

$82.41

$8.231

Dec

3.332

$73.64

$7.709

2022 Avg

3.311

$95.76

$9.64

Jan

3.266

$75.69

$7.663

Feb

3.184

$76.75

$7.081

Mar

3.255

$73.43

$7.506

Apr

3.288

$79.04

$7.699

May

3.305

$71.49

$7.325

Jun

3.335

$71.11

$7.115

Jul

3.444

$77.69

$8.295

Aug

3.423

$83.35

$8.998

Sep

3.438

$91.35

$9.422

Oct

3.534

$87.57

$9.594

Nov

3.433

$82.66

$8.512

Dec

3.486

$77.63

$8.316

2023 Avg

3.365

$78.98

$8.127

Jan

3.339

$77.53

$8.026

Feb

3.434

-

$7.96

Mar

3.423

-

$8.68

 

SOURCES

 

Bloomberg, “Iraq pumps over OPEC+ oil production target again even after lowering output,” 4/3/24

 

Salem, Amr, “Iraqi government increases the budget for 2024,” Iraqi News, 3/28/24

 

Van Heuvelen, Ben, “Iraq crude exports steady in March,” Iraq Oil Report, 4/4/24

 

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