Iraq’s crude output rose above 3 million barrels a day last month for the first time since the 2003 U.S.-led invasion that toppled Saddam Hussein, according to the Organization of Petroleum Exporting Countries.
Iraq pumped 3.08 million barrels a day in July, 115,000 barrels more than the previous month, OPEC’s Vienna-based secretariat said Friday in its Monthly Oil Market Report. The Persian Gulf state for a second month outpaced Iran, whose output dropped by 173,000 barrels to 2.82 million. Iraq last produced more than 3 million barrels in February 2002, OPEC said after revising its April estimate.
The reduction from Iran came as full sanctions by the EU started July 1, which led to the third monthly decline in the group’s output. OPEC, which supplies 40 percent of the world’s oil, produced 31.2 million barrels a day last month, versus 31.35 million in June, according to the data.
Iraqi production is increasing as overseas investors such as Exxon Mobil Corp. and BP Plc develop new fields and rework older deposits. The country has held several licensing rounds for oil and gas fields since the end of Saddam Hussein’s rule and more than two decades of stagnation caused by wars, sanctions and underinvestment.
The country’s production increased the most among OPEC’s 12 members in July. Kuwait boosted supply by 26,000 barrels a day. All others reduced or kept their output stable. Iranian volumes dropped the most.
“At this juncture, we remain prudent on the pace of Iraq’s growth, as logistical capacity has to grow as well to deliver more oil,” said Harry Tchilinguirian, BNP Paribas SA’s head of commodity markets strategy in London. “They are probably not operating at capacity because pipeline availability to deliver oil to the southern export ports is limited.”
Saudi Arabia, the world’s largest crude exporter, pumped 9.875 million barrels a day in July, versus 9.926 million in June, according to OPEC’s secondary sources. Saudi Arabia reduced its output by 300,000 barrels a day to 9.8 million, according to data the kingdom provided directly to OPEC.
Falling OPEC production last month coincided with a 7.3 percent increase in Brent crude on the ICE Futures Europe exchange.
OPEC’s members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela.