Iraqi oil exports hit five-month high

Iraq's oil exports in December were the highest since July as northern exports carried the weight of a drop in the south, Oil Ministry data show.

Most of Iraq's oil fields, production and exports are located in the south, where tankers pick up oil at offshore terminals. Northern oil exports flow through the pipeline to Turkey's Ceyhan port.

Iraq exported 1.81 million barrels per day in December, according to the newly released data. It comes as extreme lows in oil prices pressure the state budget. Iraqi oil fetched an average $34.57 per barrel in December, a drop from $43.54 per barrel in November.

Iraq's Cabinet just approved a new 2009 budget, cutting expenditures from $80 billion to $62 billion, with more than $19 billion covered by 2008 funds left unspent. Original budget estimates were based on expectations set during 2008's record oil prices but have been realigned with an expected average of $50 per barrel. Oil accounts for nearly all state income.

Even with the decrease in price, Iraq brought in $1.94 billion in December oil sales. Iraq earned $61.6 billion in oil sales in 2008, more than $20 billion more than in 2007, according to the latest U.S. State Department Iraq Status Report.

Oil exports from the south declined to 1.4 million bpd last month, compared to 1.45 million bpd in November. Northern output rose from 310,000 bpd in November to 412,903 bpd last month.

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Ben Lando, UPI Energy Editor