February 1, 2017 / 2:08 PM / in 10 months

Iraq complies with scale, if not absolute level, of OPEC cut: sources, data

LONDON/DUBAI (Reuters) - Iraq significantly reduced oil output in January, according to industry sources and export data on Wednesday, but has yet to reach levels expected by OPEC from its second largest producer.

A Reuters survey on Tuesday found Iraq lowered output by 200,000 barrels per day (bpd) compared with December - almost all the 210,000 bpd reduction it was supposed to make under the deal by the Organization of the Petroleum Exporting Countries.

The finding that output fell at all was a surprise to some in the market. Baghdad’s initial request to be exempt from the OPEC agreement, plus loading programs pointing to continued high Iraqi exports, had led to scepticism it would cut.

But Iraqi officials have been stressing that reductions - both in production and exports - would be made.

“We’re not having any technical difficulties with this,” Iraq’s oil minister Jabar al-Luaibi told Reuters in an interview in London last week, referring to implementation of the cut.

While Iraq’s production did indeed fall by 200,000 bpd, according to the Reuters survey it dropped by that amount from 4.710 million bpd in December, rather than from the 4.561 million bpd reference level for Iraq under the OPEC deal.

This means Iraq, in pumping 4.51 million bpd in January according to the Reuters survey, has complied with 24 percent of its reduction, lower than other big OPEC producers such as Saudi Arabia or the 82 percent OPEC average.

Shipping data tracked by Reuters and supported by an industry source suggest that most of the reduction came from Iraq’s southern oilfields, where industry sources say the giant Rumaila field has been undergoing planned maintenance.

Iraq’s southern exports averaged 3.26 million bpd in January, according to loading data and industry sources, down from Iraq’s own figure of 3.51 million bpd in all of December, a record high.

In contrast, exports from northern Iraq were little changed in January, according to the data and sources.

Editing by Mark Potter

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