In Iraq, sectarian violence erupted in the city of Mosul. The Iraqi army fled their posts and much of the city is now under the control of Sunni Militants. Mosul is a key city for the Iraqi oil industry which has been ramping up production and exports steadily since the US led invasion in 2003. Iraq has overtaken Iran as the second largest oil producing country among the 12 OPEC nations.
In February, oil production in Iraq hit 3.6 million barrels, setting a 30 year record. “Most of it is concentrated in the south,” says Iraq Oil report Editor-in-chief Ben Lando, “80 to 90 percent of it in Basra Province alone.”
Since March, when the Iraq Turkey pipeline in the north was bombed, production has been restricted. Attacks on repair workers have prevented the pipeline from being repaired. “So that’s about 300,000 barrels a day that would have been exported now shut in.” says Lando.
The Kurdish government in the north is trying to get oil out independently. It recently shipped a million barrels of crude by tanker, through Turkey. “From what we can tell, there wasn’t a buyer ahead of time and they are essentially looking for a port,” says Chad Mabry is an analyst with MLV and Company.
Those tankers are basically circling the Mediterranean waiting for a buyer, says Mabry, “and you are seeing some pressure from the Iraqis, telling potential buyers, you better watch out if you take that on, we are going to apply some pressure from our end.”
Iraq has set very ambitious goals for oil. The country wants to nearly triple its current production, to 9 million barrels per day by 2020, a number that, is way above industry forecasts says IBISworld analyst James Crompton. “According to the International Energy Administration by 2020 Iraq could be producing about 6 million barrels per day.”
But even those forecasts may be optimistic, if the region faces more instability.
The oil cartel OPEC, of which Iraq is a member, meets in Vienna on Wednesday to discuss production quotas for the second half of the year. Which makes your wonder about the numbers behind Iraq's oil industry:
Iraq ranks as the second largest oil producer among the 12 OPEC nations, overtaking Iran. Saudi Arabia is the top producer. (WSJ)
The number of barrels of oil Iraq produced per day in February, a 30-year high. The previous high-water mark was 3.5 million barrels per day, recorded in 1979 when dictator Saddam Hussein took power. (WSJ)
Iraq's rank among other nations around the world in terms of its proven crude oil reserves. (EIA)
The number of barrels of oil Iraq is expected to produce daily by 2020, according to Iraqi Deputy Prime Minister for Energy Hussain al-Shahristani. He also expects Iraq to export 7.5 million barrels of oil per day in the same time frame. (UPI)
The number of barrels of oil International Energy Administration analyst Jeremy Crompton says Iraq will be capable of producing daily by 2020, a forecast much lower than the country's aspirations. (International Energy Administration)
The number of barrels of oil per day that otherwise would have been exported from Iraq, were it not for a March 2 bombing attack of the Iraq-Turkey pipeline, according to Ben Lando, editor-in-chief of the Iraq Oil Report. (Iraq Oil Report)
“I think the best compliment I can give is not to say how much your programs have taught me (a ton), but how much Marketplace has motivated me to go out and teach myself.” – Michael in Arlington, VABEFORE YOU GO