Iraq: There's Capacity to Increase Oil Production by 200,000 bpd on Demand

Oilfield in Iraq - Filephoto/Reuters
Oilfield in Iraq - Filephoto/Reuters
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Iraq: There's Capacity to Increase Oil Production by 200,000 bpd on Demand

Oilfield in Iraq - Filephoto/Reuters
Oilfield in Iraq - Filephoto/Reuters

Iraq has the capacity to increase its oil production by 200,000 barrel per day (bpd) this year if asked, an executive of Iraq’s Basra Oil Co. (BOC) revealed on Friday.

“If Iraq is asked to increase production, we can add 200,000 barrels until the end of the year as available production capacity,” Hassan Mohammed, deputy BOC manager in charge of oilfields and licensing rounds affairs, said in an interview with Reuters.

“But (to produce) more than this amount, (we) need more time.” The increase will come from West Qurna 1 oilfields and other oilfields developed by Iraqi state-run oil companies, Mohammed added.

This comes two weeks after US President Joe Biden’s visit to Saudi Arabia as part of his first trip to the Middle East as US president, hoping to strike a deal on oil production to help drive down gasoline prices.

Oil prices have rocketed to their highest levels since 2008, climbing above $139 a barrel in March, after the United States and Europe imposed sanctions on Russia over its invasion of Ukraine, which Moscow calls a “special military operation.” Prices have slipped since then.

Separately, Indonesia’s state-owned oil and gas firm Pertamina bought 10 percent of Exxon Mobil’s stake in Iraq’s West Qurna 1 oilfield, increasing its share to 20 percent, while BOC bought 22.7 percent of the field.

In January, the Iraqi government gave its approval for the Iraqi National Oil Company to acquire Exxon Mobil Corp’s stake in the giant West Qurna 1 oilfield.

West Qurna 1, in southern Iraq, is one of the world’s largest oilfields with recoverable reserves estimated at more than 20 billion barrels. It produces around 550,000 barrels per day, Mohammed said.

State-run Basra Oil Company told Reuters last year Exxon was seeking to sell its 32.7 percent stake in the field for $350 million.

OPEC’s second-largest oil producer can increase its export capacity by 3 million barrels per day (bpd) if within two years Iraq upgrades its key undersea oil exports pipelines and its two onshore ports, Mohammed said.

He also said a third oil pipeline at the Khor al-Amaya oil terminal in southern Iraq and a fifth single point mooring (spm) will be operational with capacity of 1 million barrels per day by the end of 2024.

Iraq’s exports 3.3 million barrels per day. China Petroleum Engineering & Construction Corp (CPECC) has won a $300 million contract to build an energy station at giant Rumaila oilfield in Iraq, he added.



Xi: China Will Defuse External Shocks to Promote Sustained Economic Recovery

A woman holds a red paper with Chinee calligraphy “Good Fortune” as people line up to get the red paper ahead of the Lunar New Year in Beijing, Wednesday Jan. 22, 2025 (AP)
A woman holds a red paper with Chinee calligraphy “Good Fortune” as people line up to get the red paper ahead of the Lunar New Year in Beijing, Wednesday Jan. 22, 2025 (AP)
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Xi: China Will Defuse External Shocks to Promote Sustained Economic Recovery

A woman holds a red paper with Chinee calligraphy “Good Fortune” as people line up to get the red paper ahead of the Lunar New Year in Beijing, Wednesday Jan. 22, 2025 (AP)
A woman holds a red paper with Chinee calligraphy “Good Fortune” as people line up to get the red paper ahead of the Lunar New Year in Beijing, Wednesday Jan. 22, 2025 (AP)

Chinese President Xi Jinping on Monday said that his country will guard against and defuse risks in key areas and external shocks in 2025, to promote sustained economic recovery.

Xi was speaking at a high-level reception to ring in the Chinese New Year, according to China’s state-run agency, Xinhua.

China's manufacturing activity shrank in January for the first time in four months, official data showed Monday, as Beijing battles to sustain the recovery in the world's second-largest economy.

Policymakers have battled to reverse a post-pandemic slump driven by a crisis in the property sector, weak consumption and high government debt.

The Purchasing Managers' Index (PMI) - a key measure of industrial output - came in at 49.1 in January, according to the National Bureau of Statistics (NBS), below the 50-point mark that separates growth and contraction.

The reading was down from 50.1 in December, which was its third straight month in positive territory after ending a six-month decline in October.

January's slide was “affected by the approaching Lunar New Year holiday and the concentrated return of business employees to their hometowns,” NBS statistician Zhao Qinghe said.

Both production and demand slowed in the run-up to the eight-day public holiday from January 28 to February 4, Zhao said.

“Economic momentum unexpectedly slowed in both manufacturing and service sectors ahead of the Chinese New Year,” Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, wrote in a note.

“Part of the slowdown may be due to weaker external demand, as the new export orders index dropped to the lowest level since March last year,” Zhang added.

Beijing has unveiled a string of aggressive measures in recent months aimed at boosting growth, including cutting interest rates, cancelling restrictions on homebuying and easing the debt burden on local governments.

But economists have warned that more direct fiscal stimulus aimed at shoring up domestic consumption is needed to restore full health in the economy, which has struggled to fully recover since the Covid-19 pandemic.

In the markets, China stocks fell on Monday, the last day before the Lunar New Year holiday, as a surprise contraction in manufacturing activity and lingering concerns about US tariffs offset the optimism from government efforts to introduce long-term capital. However, in Hong Kong, tech shares led the market higher.

The Shanghai Composite Index finished down 0.1% at 3,250 while the Hong Kong benchmark Hang Seng Index was up 0.7% at 20,197.

Meanwhile, US President Donald Trump’s threats to impose tariffs and sanctions on Colombia - now on hold after a deal was reached - reminded investors that Trump is serious about his tariff pledges.

(The) “Tariff risks might have been delayed, but not derailed,” Morgan Stanley said in a note, estimating that weighted average tariff rate on China will rise from 10% at the end of 2024 to 26% by the end of 2025 and 36% in 2026.

These concerns dampened the excitement from signs that institutional money is starting to flow into the stock market after Beijing set specific targets last week to introduce long-term capital from insurers and mutual funds.

Three insurers, including China Pacific Insurance and Taikang Life, got regulatory approval to invest 52 billion yuan ($7.16 billion) into stocks via a newly-established fund, state media reported.