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Iraq's Daily Crude Oil Exports Drop 3.7% in June, After Increasing in May

Iraq, holder of the world’s third- largest oil reserves, exported 3.7 percent less crude daily in June than it did in the previous month, the Oil Ministry said, without giving a reason for the decrease.

Exports fell in June to about 1.82 million barrels a day, or 54.7 million barrels for the month, the ministry said today in an e-mailed statement. That compares with May shipments of 1.89 million barrels a day, or 58.7 million barrels, it said.

Iraqi officials have usually attributed past declines in crude exports to bad weather or insurgent attacks on the country’s oil infrastructure.

The ministry’s announcement came after Falah al-Amri, the head of Iraq’s Oil Marketing Co., said crude exports for this month were likely to increase to more than 1.9 million barrels a day. Al-Amri made that comment on July 18 in Baghdad. At the time, the country had experienced no interruptions to its exports for the month, he said. Iraq is likely to export about half of its July shipments to Asia, al-Amri said.

Crude exports generated 86 percent of Iraq’s total government revenue in 2008, according to the International Monetary Fund, and the country continues to depend on oil sales to finance its reconstruction after decades of conflict and economic sanctions.

Third Round

Iraq is seeking foreign investors to help boost output at its oil fields, which have suffered from a lack of investment and modern technology. The government awarded 10 contracts to international oil companies in two licensing rounds in 2009, and it announced a third round of bidding this year to develop the country’s natural gas reserves.

Revenue from oil exports dropped in June to $3.89 billion, with Iraq selling crude at an average price of $71.10 a barrel, according to the statement. The nation earned $4.34 billion from oil shipments in May, at an average price of $73.85 a barrel.

Iraq in June exported 79 percent of its crude, or 43.2 million barrels valued at $3.07 billion, from the southern port of Basra. It shipped the remaining 11.5 million barrels, earning $815 million, from the northern oil hub of Kirkuk, according to the statement.

Iraq produces a total of about 2.4 million barrels of oil a day, according to data compiled by Bloomberg. Crude exports rose in May after a three-month decline that Oil Minister Hussain Al- Shahristani, speaking last month, attributed mainly to foul weather and insurgent violence.

To contact the reporter on this story: Nayla Razzouk in Amman Nrazzouk2@bloomberg.net

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