Iraqi Oil Selling at $30 as OPEC Readies for New Battles
LONDON/DUBAI, Nov 19 (Reuters) - Iraq may increase oil output further in 2016, although less dramatically than this year, intensifying a battle for market share between OPEC members and non-OPEC rivals that has forced Baghdad to sell some crude grades for as little as $30 a barrel.
Iraq's output in 2015 has jumped almost 500,000 barrels per day (bpd), or 13 percent, according to the International Energy Agency (IEA). That has made Iraq the world's fastest source of supply growth and a key driver of surging OPEC production.
At most, that growth is likely to give way to a modest rise next year, easing downward pressure on prices that are close to a 2009 low. But a lifting of sanctions on Iran or an easing of violence in Libya could further boost OPEC supplies, without cutbacks by Saudi Arabia or other members.
"Stable to limited growth in output from Iraq would give some potential for an uptick in prices - if it were not for Iran," said Eugene Lindell, analyst at JBC Energy in Vienna. "Libya is another big wild card."
The southern fields produce most of Iraq's oil. Located far from the fighting in other parts of the country, they have kept pumping and seen record exports, most recently in July, when 3.064 million bpd was sold abroad.
Iraq plans to export 3.0-3.2 million bpd from the south in 2016, an Iraqi oil source told Reuters. He declined to forecast exports from Iraq's north, which restarted in late 2014 and have grown to about 600,000 bpd, despite tension between Baghdad and the Kurdistan region.
The scale of Iraq's growth this year surprised many observers. Moreover, the extent of any slowdown in 2016 and Iran's growth are on the minds of OPEC delegates heading into the group's Dec. 4 meeting on output policy.
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