With Opec+ agreeing last weekend to extend current cuts through July while its dominant members increased the pressure on non-compliant producers to cut deeper (MEES, 12 June), Iraq’s perennial undercompliance is once again at the center of Opec politics. MEES calculates that Iraqi production averaged 4.13mn b/d in May – 540,000 b/d over its quota (see chart 1) – making it the posterchild for non-compliance.
The critical question now, for both Iraq and its Opec+ partners, is whether Baghdad will get serious in its efforts to comply. So far, new oil minister Ihsan Ismaeel has talked a good game, telling his Saudi counterpart on 9 June that Iraq would work to fully implement pledged cuts for June and July and into the second phase in the second half of the year, despite its “economic and financial challenges”. It will “compensate” for overproduction between now and September. (CONTINUED - 1399 WORDS)