Iraq’s PM Mohammed al-Sudani met several top executives from the oil, electricity and finance ministries on 16 November to discuss financial dues to contractors in the energy sector. Iraq has delayed payments to IOCs in recent months. Field operators often receive crude cargoes as payment in kind as Baghdad needs the cash receipts from sales to fund its budget. An industry insider claims these cargoes now account for up to 25% of exported crude.
The government also depends on proceeds from fuel oil and naphtha exports to pay contractors, such as power generators. An oil ministry readout says the meeting discussed increasing these volumes and “a mechanism for revenue flows and restricting exports through Somo.” Iraqi fuel oil exports have been in the spotlight this year, with the US imposing sanctions on Basra’s VS Oil terminal in July, followed by another round of sanctions on several vessels used in ship-to-ship transfers in the Khor al-Zubair lightering area in September for alleged involvement in smuggling Iranian volumes (MEES, 5 September & MEES, 18 July). (CONTINUED - 170 WORDS)