Iraq dismisses non-compliance allegations

19 September 2017

Iraq is subject to ongoing Opec oil production cuts

Iraq’s oil minister Jabbar al-Luaibi says that allegations Iraq was not in compliance with Opec’s oil production cuts are “foundless.”

“There are many sources that shout on Iraq as being the trouble maker and being a badboy within Opec. This is totally rejected as a foundless allegation,” said Al-Luaibi, speaking at The Gulf Intelligence Energy Markets Forum on 19 September.

As an Opec member, Al-Luaibi said that Iraq had actually cut more than the required 220,000 barrels a day (b/d) of production.

“We are required to cut 220,000 b/d, but we are in the range of 270 000 b/d,” said Al-Luaibi.

“Iraq has exceeded its share of compliance. There are some sources, such as secondary sources that point out that Iraq is falling behind and this is completely wrong. I don’t accept it and the government doesn’t accept it,” says al-Luaibi.

He dismissed reports that Iraq’s need for oil revenues to fight the Islamic State in Iraq and Syria (Isis) in Iraq would cause it to renege on its pledge to cut production.

“The fight against Isis cost us a significant amount of money, around three to four per cent of the revenues. It was a vicious time and a costly time, in terms of finance. This does not mean that we need revenue and go cheating on Opec or bypassing it,” he said.

Opec came to a historic agreement along with non-Opec countries at the end of 2016 to cut a collective 1.8 million b/d production in order to stabilise oil prices that fell from over $100 in early 2014 to less than half that by end of the same year. The exporting group agreed to extend the production cuts for another nine months in May.

Compliance level among Opec members presently stands at 70 per cent, while non-Opec compliance is 65 per cent.

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