Iraq has finally started to cut oil production to comply with OPEC+ quotas. The organization is attempting to stabilize prices as they fall which poses a large threat to Baghdad’s budget.
In September Iraq exported an average of 3.31 million barrels a day of oil. That was down from 3.414 million in August and 3.486 million in July. That dropped the country’s yearly average from 3.4 million to 3.3 million per month which is where it has been for the last 3 years.
Iraq has been promising for several months to comply with OPEC+ production quotas. It has reduced its output but it is still far above where it promised to be. This comes as international prices for petroleum have been dropping.
The Oil Ministry has stopped releasing full monthly data but Iraq Oil Report estimated that the country earned $7.11 billion in September. That was the lowest amount since February 2023.
The government is monitoring this situation closely because its budget is based upon $70 per barrel. International prices are hovering right around that amount. Baghdad has passed two of its biggest budgets in history and if its revenues continue to drop it will have to dip into its foreign reserves and borrow to cover its massive spending which is dominated by public salaries and pensions. The authorities never plan for these situations which often lead to financial crises.
Federal Oil Exports, Prices, Revenues 2020-2022
|
Month |
Avg Export (Mil) |
Earnings (Bil) |
|
Jan 2021 |
2.868 |
$4.765 |
|
Feb |
2.96 |
$5.013 |
|
Mar |
2.946 |
$5.787 |
|
Apr |
2.947 |
$5.549 |
|
May |
2.899 |
$5.917 |
|
Jun |
2.892 |
$6.143 |
|
Jul |
2.918 |
$6.476 |
|
Aug |
3.054 |
$6.553 |
|
Sep |
3.081 |
$6.777 |
|
Oct |
3.12 |
$7.666 |
|
Nov |
3.272 |
$7.611 |
|
Dec |
3.277 |
$7.391 |
|
2021 Avg |
3.019 |
$6.303 |
|
Jan 2022 |
3.203 |
$8.323 |
|
Feb |
3.314 |
$8.544 |
|
Mar |
3.244 |
$10.913 |
|
Apr |
3.38 |
$10.554 |
|
May |
3.3 |
$11.44 |
|
Jun |
3.373 |
$11.505 |
|
Jul |
3.303 |
$10.608 |
|
Aug |
3.286 |
$9.784 |
|
Sep |
3.292 |
$8.845 |
|
Oct |
3.382 |
$9.258 |
|
Nov |
3.329 |
$8.231 |
|
Dec |
3.332 |
$7.709 |
|
2022 Avg |
3.311 |
$9.64 |
|
Jan |
3.266 |
$7.663 |
|
Feb |
3.184 |
$7.081 |
|
Mar |
3.255 |
$7.506 |
|
Apr |
3.288 |
$7.699 |
|
May |
3.305 |
$7.325 |
|
Jun |
3.335 |
$7.115 |
|
Jul |
3.444 |
$8.294 |
|
Aug |
3.423 |
$8.998 |
|
Sep |
3.438 |
$9.422 |
|
Oct |
3.534 |
$9.594 |
|
Nov |
3.433 |
$8.482 |
|
Dec |
3.486 |
$8.311 |
|
2023 Avg |
3.365 |
$8.124 |
|
Jan |
3.339 |
$8.026 |
|
Feb |
3.434
|
$7.96 |
|
Mar |
3.423 |
$8.65 |
|
Apr |
3.413 |
$8.75 |
|
May |
3.359 |
$8.14 |
|
Jun |
3.41 |
$8.25 |
|
Jul |
3.486 |
$9.08 |
|
Aug |
3.414 |
$8.49 |
|
Sep |
3.31 |
$7.11 |
|
2024 Avg |
3.398 |
8.272 |
SOURCES
Iraq Oil Report, “August production falls as Iraq initiates cuts,” 9/27/24
Van Heuvelen, Ben, “September exports fall as Iraq claims OPEC quota compliance,” Iraq Oil Report, 10/4/24
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