Falling US crude stocks kept the oil price high in early May, despite Baghdad's announcement that it was recommencing oil exports after a one-month moratorium. Benchmark Brent crude on 7 May was valued at $27.14, an increase of more than $1 a barrel over the previous week.

The American Petroleum Institute on 7 May reported a fall in US crude stocks of 4.5 million barrels in the week ending 3 May, bringing the year-on-year growth in stocks to just 600,000 barrels. The fall reflects growth in US demand as well as tightening supply. The month-long Iraqi oil export moratorium, carried out to show solidarity with the Palestinian intifada, is only starting to make an impact now, as a result of the time lag between oil shipment and arrival. Iraqi exports began again on 9 May, but will take several weeks to reach the market.

Other OPEC members appear not to have filled the gap left by the missing 1.34 million barrels a day (b/d) of Iraqi oil with their own production, estimated to have fallen by about 80,000 b/d in April.