Iraq orders new OPEC cuts targeting IOC fields

A comprehensive survey of Iraqi fields suggests the Oil Ministry is targeting about 600,000 bpd of production cuts in May, mostly from fields contracted to international oil companies.
Iraq orders new OPEC cuts targeting IOC fields
South Oil Company workers look toward the flares in the Zubair oil field on Jan. 21, 2010, the day before Eni, Occidental and Kogas signed the contract to develop the field. (ESSAM AL-SUDANI/AFP/Getty Images)

Iraq's Oil Ministry is overseeing about 600,000 barrels per day (bpd) of new production cuts, as part of a coordinated effort by the OPEC-plus coalition to reduce global oil supplies and prop up prices.

With some reductions already beginning over the past month, Iraq's nationwide oil production fell in April to 4.38 million bpd, according to an Iraq Oil Report analysis based on data gathered from each field, which is about 220,000 bpd below the country's average output in the first quarter of this year.

If fully implemented, the latest cuts – which include just over 500,000 bpd from fields operated by international oil companies (IOCs) – will drop production even further in May, to just below 4 million bpd.

Iraq Oil Report calculated the aggregate size of Iraq's latest cuts by surveying senior officials at all of the country's state-run oil companies. The Oil Ministry in Baghdad typically gives overall monthly production targets to each state-run company, which is then responsible for managing output at the individual fields in its portfolio.

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