Another Setback For Iraq's Oil Industry

Saboteurs are gaining the upper hand in their battle against Iraq's oil industry. Iraqi production rose to a postwar high of 2.4 million barrels per day in March, but increasingly sophisticated attacks on infrastructure pared back the flow to just above 2 million bbl per day in May. On June 15, insurgents knocked out the two main feeder lines for Iraq's southern terminals at Basra and Khor al-Amaya, shutting both of them down. Normally, tankers take on about 1.6 million bbl per day of crude from these outlets, mostly from Basra. Repairs may require a week or more.

Sabotage has kept Iraq's northern export route closed for much of the past year, but of late insurgents are scoring successes against the key southern oil industry, which produces about 80% of Iraqi oil and accounts for nearly all exports. When exports are cut, Iraq loses some $50 million in revenues a day.

Edited by Rose Brady

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