Despite supply disruptions and security threats, Iraq was the second-leading contributor to global oil supply growth in 2014
According to information released by the Energy Information Administration (EIA) today, Iraq’s production growth in 2014 was the second largest in the world, trailing only the United States. Iraq accounted for almost 60% of production growth among OPEC members, although its growth was more than offset by production declines in other OPEC countries.
Iraq’s crude oil production, which averaged almost 3,400 MBOPD in 2014, was 330 MBOPD above 2013 levels, despite the heightened security threat from the Islamic State of Iraq and the Levant (ISIL) and disrupted production in northern Iraq, according to the EIA.
ISIL attacks in northern Iraq in early June 2014 reduced regional production and refinery operations, not including the Iraqi Kurdistan Region. These attacks did not affect southern production and exports, which accounted for 95% of Iraq’s total crude oil exports in 2014.
Iraq’s crude oil production fell to its lowest monthly levels for the year during July and August following the start of the ISIL offensive. From August to December, Iraq’s production grew by almost 600 MBOPD. In December, Iraq’s crude oil production reached 3,750 MBOPD, the highest amount on record.
While some companies were forced to abandon exploration projects in northern Iraq due to the ISIL offensive, which could delay future development, more increases in production seem likely, report the agency. In December, Iraq’s central government and the Kurdish Regional Government reached a deal on oil exports and revenues, which could facilitate significant increases in production and exports from fields in the Iraqi Kurdish Region. Barring any major supply disruption, the EIA expects that Iraq will continue to be OPEC’S largest source of production growth over the next two years.
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