Iraqi oil output met with caution

Aug. 10, 2012 at 7:19 AM
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LONDON, Aug. 10 (UPI) -- Despite increases in oil production from Iraq, the country's operating capacity is limited by a lack of pipeline infrastructure, a commodities analyst said.

The Organization of Petroleum Exporting Countries, in its monthly report for August, reports that Iraqi crude oil output passed the 3 million barrel per day mark for the first time since 2003.

OPEC said Iraq pumped 3.08 million bpd last year, up 115,000 bpd compared with June levels.

Harry Tchilinguirian, head of commodity markets strategy for BNP Paribas in London, told Bloomberg News the industry was taking a cautious approach to Iraq's oil ambitions.

"They are probably not operating at capacity because pipeline availability to deliver oil to the southern export ports is limited," he said.

The country recently opened offshore mooring facilities at its southern ports to ease export bottlenecks, however.

Iraq's total export capacity was curtailed by an early 2012 decision by the semiautonomous Kurdistan Regional Government to halt exports in response to disputes with Baghdad. The KRG said exports would resume this month, however, as a goodwill gesture meant to encourage Baghdad to settle outstanding payment disputes regarding international oil companies working in the north.

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