Iraq’s oil minister said the nation’s crude exports would accelerate next month, adding to signs that violence in the country’s north is not affecting the oil-rich south.
“Oil exports will witness a big increase, as recent events didn’t reflect negatively on Iraq’s crude output and exports,” Oil Minister Abdul-Kareem al-Luaibi said Wednesday. “International oil companies are working normally.”
While violence in Iraq spurred companies including BP PLC. and Exxon Mobil Corp. to evacuate staff, there are few signs so far that oil production is being affected. Iraq’s exports will be close to a record next month, according to loading programs obtained by Bloomberg.
Luaibi added that he had spoken to BP about increasing output at the Rumaila field, the nation’s largest. Toby Odone, a BP spokesman in London, declined to comment.
Iraq, holder of the world’s fifth-largest crude reserves, produces and exports most of its oil from the Shiite-dominated south, which remains largely unaffected by the clashes. Gunmen Wednesday seized the 20,000 barrel-a-day Ajeel oil field, which remains inactive, in the northern oil hub of Kirkuk, police said.
Brent crude, the global benchmark grade, was down 0.1 percent at $113.86 a barrel just after 11 a.m. in London Thursday. Prices have dropped by over 1 percent since reaching a nine-month high on June 19. Brent may slip back toward $110 “in the near term” as the fighting in Iraq has not disrupted output, according to a report issued yesterday by Danske Bank A/S.
Luaibi said exports averaged over 2.5 million barrels a day this month, but did not make an estimate for July.
Government troops continue to control the state-run North Oil Co. and the Baiji refinery, the country’s largest, Luaibi said. Baiji has been shut since June 15 after Sunni insurgents from the Islamic State in Iraq and Greater Syria tried to seize the 310,000 barrels-a-day plant.
“The Iraqi Oil Ministry will not allow any party to infringe on its establishments or installations,” he said. “The Oil Ministry is working to regain control of any oil installation taken by gunmen.”
The northern Kirkuk oil field is defended by troops from the self-governing Kurdistan Regional Government, which controls 45 billion barrels of crude reserves. The rest of Iraq holds 150 billion barrels in proven crude reserves.