Iraq’s oil minister said the nation’s crude exports will accelerate next month, adding to signs that violence in the country’s north isn’t affecting the oil-rich south.
“Oil exports will witness a big increase, as recent events didn’t reflect negatively on Iraq’s crude output and exports,” Oil Minister Abdul Kareem al-Luaibi said in an interview in Baghdad yesterday. “International oil companies are working normally in Iraq.”
While violence in Iraq spurred companies including BP Plc (BP/) and Exxon Mobil Corp. to evacuate workers from the country, there are few signs so far that oil production is being affected. Iraq’s exports will be close to a record next month, according to loading programs obtained by Bloomberg. Luaibi said in the interview that he’s spoken to BP about increasing output at the Rumaila field, the nation’s largest. Toby Odone, a BP spokesman in London, declined to comment on the field.
Iraq, holder of the world’s fifth-largest crude reserves, produces and exports most of its oil from the Shiite-dominated south, which remains largely unaffected by the clashes. Gunmen yesterday seized the 20,000 barrel-a-day Ajeel oilfield, which remains inactive, in the northern oil hub of Kirkuk, according to a local police statement.
Brent crude, the global benchmark grade, was down 0.1 percent at $113.86 a barrel at 11:11 a.m. in London today. Prices have dropped more than 1 percent since reaching a nine-month high on June 19. Brent may slip back toward $110 “in the near term” as the fighting in Iraq hasn’t disrupted output, according to an e-mailed report today from Danske Bank A/S.
Luaibi said exports averaged more than 2.5 million barrels a day this month. He didn’t say what they will be in July.
Government troops continue to control the state-run North Oil Co. and the Baiji refinery, the country’s largest, Luaibi said. Baiji has been shut since June 15 after Sunni insurgents from the the Islamic State in Iraq and the Levant tried to seize the 310,000 barrels-a-day plant.
“The Iraqi Oil Ministry will not allow any party to infringe on its establishments or installations,” he said. “The Oil Ministry is working to regain control of any oil installation taken by gunmen.”
The northern Kirkuk oilfield is defended by troops from the self-governing Kurdistan Regional Government which controls 45 billion barrels of crude reserves. Iraq, excluding its Kurdish enclave, holds 150 billion barrels in proven crude reserves. Iraq is the largest oil producer, after Saudi Arabia, in the Organization of Petroleum Exporting Countries.
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