Iraq to rival Saudi in OPEC oil stakes
Thursday, 24 December 2009
LUANDA, Dec 23 (AFP): A surge from Iraq's oilfields will occupy OPEC crude producers in coming years as the recovering country's output challenges that of Saudi Arabia, observers said as the cartel held its latest meeting.
Iraq has signed several contracts this month with foreign oil companies and said it could raise production to 12 million barrels a day by 2016 -- a level to rival Saudi Arabia, the world's biggest oil producer.
Iraqi Oil Minister Hussein al-Shahristani insisted Iraq will have a strong market for this oil in the coming decades, despite pressure from world powers to reduce use of carbon fuels to protect the environment.
"We expect the demand for oil to increase over the coming 20 years," he told AFP at Tuesday's meeting.
"There is definitely a need in the market for additional production and... there is no better place than Iraq to provide it."
Delegates at Tuesday's talks said they had not yet broached the question of admitting Iraq into the group's quota system, focussing instead on economic threats that could weaken the recovery in the oil market.
Kuwait and others have also insisted they are not concerned by Iraq's prospective rise. But analysts said Iraq's expansion would be weighing on members' minds in the medium term.
"In a five-year perspective there could be a big issue for OPEC how to incorporate Iraq into the quota system, as Iraqi output is set to increase quite a lot," wrote Torbjorn Kjus, an Oslo-based analyst at DnB NOR Markets.
Saudi Arabia's Oil Minister Ali al-Naimi left open the possibility that his country, the most powerful in OPEC, could cut some of its output-currently at more than eight million barrels day-to accommodate Iraq's increase.
Iraq has signed several contracts this month with foreign oil companies and said it could raise production to 12 million barrels a day by 2016 -- a level to rival Saudi Arabia, the world's biggest oil producer.
Iraqi Oil Minister Hussein al-Shahristani insisted Iraq will have a strong market for this oil in the coming decades, despite pressure from world powers to reduce use of carbon fuels to protect the environment.
"We expect the demand for oil to increase over the coming 20 years," he told AFP at Tuesday's meeting.
"There is definitely a need in the market for additional production and... there is no better place than Iraq to provide it."
Delegates at Tuesday's talks said they had not yet broached the question of admitting Iraq into the group's quota system, focussing instead on economic threats that could weaken the recovery in the oil market.
Kuwait and others have also insisted they are not concerned by Iraq's prospective rise. But analysts said Iraq's expansion would be weighing on members' minds in the medium term.
"In a five-year perspective there could be a big issue for OPEC how to incorporate Iraq into the quota system, as Iraqi output is set to increase quite a lot," wrote Torbjorn Kjus, an Oslo-based analyst at DnB NOR Markets.
Saudi Arabia's Oil Minister Ali al-Naimi left open the possibility that his country, the most powerful in OPEC, could cut some of its output-currently at more than eight million barrels day-to accommodate Iraq's increase.