Page 9 - MEOG Week 32.indd

MEOG POLICY MEOG

Iraq announces

additional cuts for August

IRAQ BAGHDAD announced last week that it would bpd in September.
increase voluntary additional oil production As reported by Middle East Oil & Gas
cuts to 400,000 barrels per day below its 3.8mn (MEOG) in mid-July, IOCs operating the coun-
bpd ceiling in August to make up for previous try’s southern oilfields have been asked to reduce
non-compliance with OPEC+ cuts. output by a combined total of 350,000 bpd,
Iraq’s State Oil Marketing Organization though they will receive compensation for doing
(SOMO) said that the quota level would last so. Meanwhile, state-owned Basra Oil Co. (BOC)
until the end of the year, up from the 3.59mn bpd is expected to shave production by 300,000 bpd.
quota from May-July. In early August, a monthly survey published
The country’s Ministry of Oil (MoO) said that by Reuters showed that Iraq – and fellow OPEC+
production in May was 4.07mn bpd and 3.7mn laggard Nigeria – had failed to make any signif-
bpd in June, with all indications pointing to July icant progress in improving compliance, while
output also being well above the OPEC+ quota, total OPEC output averaged 23.32mn bpd in
with total July exports averaging 2.76mn bpd. July, an increase of 970,000 bpd.
Iraq committed to reduce production by a total According to Argus, 60,000 bpd of export
of 1.06mn bpd. reductions by SOMO were partially offset by
According to the Iraq Oil Report, output 15,000 bpd of additional flows from the Kurdis-
dropped by 265,000 bpd in June, though its esti- tan Region of northern Iraq, as output increased
mate of total production was higher than the from DNO’s Tawke licence.
government figure at 3.91mn bpd. In late July, the Gharraf oilfield in south-
SOMO’s statement appears to supersede ern Iraq returned to production at a rate of
Baghdad’s July agreement to make compensa- 50,000 bpd following shutdown because of
tory cuts of 314,000 bpd in August and 313,000 COVID-19.™

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