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Iraq Starts Taking over Majnoon Oilfield Operations from Shell

A worker walks through the Majnoon oilfield in Basra. Photo: Reuters
A worker walks through the Majnoon oilfield in Basra. Photo: Reuters
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Iraq Starts Taking over Majnoon Oilfield Operations from Shell

A worker walks through the Majnoon oilfield in Basra. Photo: Reuters
A worker walks through the Majnoon oilfield in Basra. Photo: Reuters

Iraq's oil ministry said on Thursday it had started to take over operations of Majnoon oilfield from Royal Dutch Shell and planned to lift output in future.

The ministry said it had formed a management team to handle production after Shell exits the field by the end of June.

"The priority of the new management team is to cut the cost of producing a barrel (of crude) from Majnoon by 30 percent," Oil Minister Jabar al-Luaibi said in a statement.

Iraq plans to increase output from Majnoon to 400,000 barrels per day (bpd) in the "coming years", the ministry said, without giving a precise timeline.

Production is now about 235,000 bpd, oil officials say.

A letter signed by the minister, dated Aug. 23 and seen by Reuters, gave approval for the Anglo-Dutch firm to quit Majnoon, a major oilfield near Basra which started production in 2014.

Shell said it would focus its efforts on developing and expanding Basra Gas Company in Iraq after handing over operations of Majnoon to the Iraqi government.

Basra Gas Company is a joint venture between Shell, South Gas Company and Mitsubishi and the Petrochemical Project NEBRAS. Chevron, Total and PetroChina may form a consortium to develop Iraq's Majnoon oilfield, the minister said in Vienna in November.

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Gold Hits Four-week Peak on Safe-haven Demand

A view shows ingots of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk
A view shows ingots of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk
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Gold Hits Four-week Peak on Safe-haven Demand

A view shows ingots of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk
A view shows ingots of 99.99 percent pure gold in a workroom during production at Krastsvetmet precious metals plant in the Siberian city of Krasnoyarsk, Russia, May 23, 2024. REUTERS/Alexander Manzyuk

Gold prices rose to a near four-week high on Thursday, supported by safe-haven demand, while investors weighed how US President-elect Donald Trump's policies would impact the economy and inflation.

Spot gold inched up 0.4% to $2,672.18 per ounce, as of 0918 a.m. ET (1418 GMT). US gold futures rose 0.7% to $2,691.80.

"Safe-haven demand is modestly supporting gold, offsetting downside pressure coming from a stronger dollar and higher rates," UBS analyst Giovanni Staunovo said.

The dollar index hovered near a one-week high, making gold less appealing for holders of other currencies, while the benchmark 10-year Treasury yield stayed near eight-month peaks, Reuters reported.

"Market uncertainty is likely to persist with the upcoming inauguration of Donald Trump as the next US president," Staunovo said.

Trump is considering declaring a national economic emergency to provide legal justification for a series of universal tariffs on allies and adversaries, CNN reported on Wednesday, citing sources familiar with the matter.

Trump will take office on Jan. 20 and his proposed tariffs could potentially ignite trade wars and inflation. In such a scenario, gold, considered a hedge against inflation, is likely to perform well.

Investors' focus now shifts to Friday's US nonfarm payrolls due at 08:30 a.m. ET for further clarity on the Federal Reserve's interest rate path.

Non-farm payrolls likely rose by 160,000 jobs in December after surging by 227,000 in November, a Reuters survey showed.

Gold hit a near four-week high on Wednesday after a weaker-than-expected US private employment report hinted that the Fed may be less cautious about easing rates this year.

However, minutes of the Fed's December policy meeting showed officials' concern that Trump's proposed tariffs and immigration policies may prolong the fight against rising prices.

High rates reduce the non-yielding asset's appeal.

The World Gold Council on Wednesday said physically-backed gold exchange-traded funds registered their first inflow in four years.

Spot silver rose 0.7% to $30.32 per ounce, platinum fell 0.8% to $948.55 and palladium shed 1.4% to $915.75.