Iraq’s oil output capacity is nearing 5 million barrels per day (bpd), but the country will remain in full compliance with its output target under a global pact to cut supplies, oil minister, Jabar Al-Luaibi, said on Saturday.
Speaking in an industry conference held in UAE’s Abu Dhabi, Luaibi said: “The market now is not 100 percent stable,” adding that the current oil prices could be sustained, but there might be some fluctuations.
He stressed the supply cut agreement between the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers “should continue despite a rise in oil prices.” The deal between OPEC and Russia to cut 1.8 million barrels per day of crude, which started in January 2017, is due to last until the end of 2018.
Luaibi noted that the current Iraq’s oil production is about 4.3 million bpd.
Despite the increase in oil production from the United States, “so far there is a balance” in the oil market, the Iraqi minister pointed out.
“We are watching the market and the market is okay in terms of supply and demand balance. There’s still a gap, inventories are still high. The inventory level will decrease gradually and we will see how things will go,” he told the reporters during the conference.
The Iraqi minister revealed about the ministry’s plans to conclude three contracts with international gas companies by mid-2018 “to utilise gas from Basra, Maysan and Nassiriyah southern provinces.”
By 2021, Luaibi said, the country plans to “reach zero gas flaring.”
Iraq is forced to flare some of the gas produced alongside crude oil as it lacks the facilities needed to capture and process it into usable fuel.
The country has just one gas processing company, the Basrah Gas Company, a joint venture between Iraq’s state-run South Gas Co., Shell and Mitsubishi.
Iraq, OPEC’s second-largest crude producer after Saudi Arabia, is seeking to increase its oil and gas income, which account for nearly all its public budget.