SINGAPORE (Reuters) - Iraq’s crude oil production and exports are expected to grow at a steady pace in 2017 from current levels, a senior Iraqi oil official said on Wednesday, adding the OPEC member supports a global freeze initiative if it will help stabilize the market.
“There will be a steady growth in production and exports next year,” Falah Alamri, the head of Iraq’s State Oil Marketing Co. (SOMO) told Reuters in Singapore, adding “it was not clear by how much.”
Iraq’s production was at 4.638 million barrels per day in August, the highest since January.
“We have no problem with exporting our crude volumes. There is a huge demand for both Basra Light and Basra Heavy,” he said on the sidelines of the Asia Pacific Petroleum Conference (APPEC) in Singapore.
Members of the Organization of the Petroleum Exporting Countries will meet on the sidelines of the International Energy Forum (IEF) in Algeria on Sept. 26-28 and are expected to discuss a possible output freeze. Russia, the world’s largest oil producer, also plans to attend the IEF.
Alamri, who is also Iraq’s OPEC governor, said his country supports a global output freeze if it would prop up the market.
“Our government supported the freeze and we have to support the freeze. We have the capacity to produce more. But if the freeze is for a certain period and will stabilize the market, definitely the freeze is in our favor,” he said.
Alamri said that a recent agreement between Baghdad and Iraq’s semi-autonomous region of Kurdistan to jointly export crude from the giant Kirkuk oilfield “was not new, it’s part of the 2016 budget agreement.”
About 70,000 to 100,000 bpd of Kirkuk oil will be exported through the Turkish Mediterranean port of Ceyhan as a 50/50 split between the Kurdish Regional Government (KRG) and the Oil Ministry in Baghdad, he said.
There was no clear deal on how to handle the Kirkuk flows and exports revenue for 2017 yet, he said, adding “the important thing is that there is some kind of cooperation between the Federal Government and the KRG.”
Iraq’s government had said that if a new revenue deal was not reached, oil from Kirkuk could be exported by trucks via Iran.
“There is no agreement but maybe in the future may be there is an opportunity,” Alamri said.
Transporting oil by truck costs significantly more than pipeline exports to Ceyhan, likely complicating such a move.
Reporting by Rania El-Gamal; Editing by Christian Schmollinger