Iraq’s southern oil exports fall from record in May


Iraq’s oil exports from its southern ports have slipped by 170,000 barrels per day (bpd) so far in May, according to shipping data tracked by Reuters, although Iraq remains hopeful of sustaining shipments at April’s record rate.
Exports from the Basra oil terminal, Khor al-Amaya and two new Gulf outlets have averaged 1.94 million bpd in the first 18 days of May, the data showed. Iraq said its southern exports averaged 2.11 million bpd last month.

An Iraqi oil official said on Friday production had dropped because urgent maintenance had been necessary at one of the southern oilfields. With production now restored, shipments should rebound in the rest of the month.

“Hopefully, we will achieve exports of 2.1 million barrels a day in the south and an overall total of 2.5 million,” the official, who declined to be identified, told Reuters.

A sustained drop in shipments would dent hopes that a long-awaited increase in Iraq’s export capacity in 2012 will ease a strain on world supplies. The country is the only source of substantial new supplies in the near future.

“There is only one country that can significantly increase output today, and that is Iraq,” Fatih Birol, chief economist at the International Energy Agency, told the 2012 Reuters Global Energy & Environment Summit this week.

“If there is no good news from Iraq, it’s bad news for the global oil outlook.”

Post war record

Foreign oil companies signed a series of development deals in 2010 to expand Iraq’s oil output, which was held back for years after decades of war and sanctions.

More oil is coming from the southern fields of Rumaila, led by BP ; West Qurna-1, run by Exxon Mobil ; and Zubair, where Eni is in charge.
As things stand, Iraq’s exports could average 2.34 million bpd in May including southern shipments and the 400,000 bpd shipped by pipeline from the Kirkuk field in northern Iraq to Turkey.

That would be less than in April, when Iraq shipped 2.5 million bpd to international markets according to its State Oil Marketing Organization - a post-war record rate.

Still, an oil official involved in one of Iraq’s oil projects said on Friday a southern export rate of 1.95 million bpd was more realistic, after crude that had been held in storage was sold.

Iraq is expected to provide the world’s largest expansion in oil export capacity in 2012 due to the opening of two floating Single Point Mooring terminals in the Gulf earlier this year.

Its southern shipments were stuck for most of last year at around 1.7 million bpd.