21 August 2018, London — Oil exports from southern Iraq are on course to hit another record high this month, two industry sources said, adding to signs that OPEC’s second-largest producer is following through on the group’s agreement to raise output.
Southern Iraqi exports in the first 19 days of August averaged 3.7 million barrels per day, according to ship-tracking data compiled by an industry source, up 160,000 bpd from July’s 3.54 million bpd – the existing monthly record.
The increase follows June’s pact among OPEC and allied oil producers to boost supply after they had curbed output since 2017 to remove a glut. Iraq in July provided the largest increase among OPEC members that took part in the previous cuts.
“We are seeing volumes run at another record so far in the month,” the industry source said on Tuesday.
A second industry source who tracks shipments said exports this month had averaged at least 3.6 million bpd, reflecting smooth operations at export terminals and a lack of developments such as bad weather that can curb shipments.
“It’s just business as usual,” the source said. “There are no major storms, winds or anything.”
Other sources say exports from Iraq’s south, the outlet for most of its crude, are higher this month. Two oil executives quoted on Aug. 16 said such shipments had averaged 3.6 million bpd in August.
Before the June OPEC deal, Iraq had been boosting exports from southern terminals to offset a halt in shipments from the northern Kirkuk region last October after Iraqi forces seized control of oilfields there from Kurdish fighters.
Northern exports have also increased in August, averaging about 350,000 bpd so far, according to shipping data, up from about 300,000 bpd in July. That is still far below levels of more than 500,000 bpd in some months of 2017.
On June 22-23, OPEC, Russia and other non-members agreed to return to 100 percent compliance with output cuts that began in January 2017. That amounted to an increase of about 1 million bpd, according to OPEC’s de facto leader, Saudi Arabia.
Iraq told the Organization of the Petroleum Exporting Countries that it boosted production by 100,000 bpd month-on-month in July, while Saudi Arabia cut back.
*Alex Lawler; Editing: Dale Hudson – Reuters