Top Energy Stories

A rise in oil product smuggling is contributing to fuel shortages in Iraq, as illicit traders take advantage of the massive spread between sky high global energy prices and heavily subsidized Iraqi fuel products. Smuggled fuel ends up in a variety of locations, including the Kurdistan region (which has a more market-based gasoline sector), black market stations in federal Iraq, and neighboring states. Smuggling takes numerous forms, from wholesale redirection of tanker trucks intended for government-supplied fuel stations, to individuals buying subsidized fuel in federal Iraq and reselling it at market rates, to illegal taps on oil product pipelines. The practice is not new, but the scale of the trade has expanded in recent months because sharp increases in global oil and fuel prices have increased margins and incentivized smugglers, according to traders and oil industry officials. Read the full story on Iraq Oil Report.

An attack Sunday night caused an explosion in the vicinity of a key pumping station on Iraqi Kurdistan's oil export pipeline, just four days after a rocket struck near a refinery complex in Erbil. In comparison to other recent attacks on or near energy infrastructure, Sunday's incident has been kept unusually quiet: the Kurdistan Regional Government (KRG) has not publicly acknowledged it, and several government and security officials said they had not heard about it. Whether or not the Feyshkabour pumping station was the intended target, any attack in the vicinity is likely to raise worries because the pipeline is an economic artery for Iraqi Kurdistan. It has averaged just under 500,000 barrels per day (bpd) of crude exports in recent months, including about 400,000 bpd of the KRG's independent oil sales — the KRG's only crude export outlet and single largest source of revenue. Read the full story on Iraq Oil Report.

Iraq's Oil Ministry and representatives from the Kurdistan Regional Government (KRG) have met for the first time to discuss a major court ruling that invalidated the legal foundations of the semi-autonomous region’s oil and gas industry, nearly two months after the decision was announced. Oil Minister Ihsan Ismaael hosted the KRG delegation in Baghdad on Monday for a meeting that appeared to highlight the differing approaches Erbil and Baghdad are taking in the aftermath of the court decision, which was issued in February in response to a decade-old case over the legality of the KRG’s oil and gas industry. KRG leaders have signaled they are planning to respond to the decision not by implementing it but by seeking political negotiations with Baghdad to resolve the underlying legal and constitutional issues raised by the court in a way that preserves Kurdistan’s oil autonomy. Ismaael, on the other hand, has proposed technical talks based on the premise that the court ruling must be implemented. Read the full story on Iraq Oil Report.

How To Navigate Iraq's Business Environment

A message from Iraq Britain Business Council (IBBC):

International and regional companies operating in Iraq need good advocacy, insights, and support to navigate Iraq’s business environment. IBBC has many years of successful operations on behalf of our members, with strong Governmental and supply chain contacts to enable and promote your business. Why not apply for membership and attend our international London and Dubai conferences open to non-members?

Register for our upcoming IBBC Spring Conference at the Mansion House, London on May 24 via our website here.

IBBC also runs trade missions to Iraq, at least three events a month in the UK, Iraq and MENA region, special member away weekends, dinners, and meetings with Iraqi officials in UK and Iraq, and regular advisory papers on economics and political economy of Iraq. We are Iraq’s International business network with a strong anchor in the UK, and we welcome reputable businesses from all sectors, including especially Education, Training and Heritage, Professional Services, Energy, Tech, General Trading, Construction and Finance.

Email london@webuildiraq.org for further information.

Interview Spotlight

Iraq Oil Report spoke with Ali Jassim Hammoud, the director general of the Missan Oil Company (MOC), which is the second-highest-producing state-owned firm in Iraq. MOC is set to increase from its current 430,000 barrels per day (bpd) in the coming months as the Amara and Nur fields resume production following compliance with OPEC-plus output cuts. The company’s longer-term target is to increase production capacity from the Missan fields, including the giant Halfaya field, to 1 million bpd once investments are secured to further develop existing fields, discovered but undeveloped fields, and new discoveries. A full transcript of the interview is available for subscribers on Iraq Oil Report.

More National News

Zack Kopplin and Basma Humadi for American Prospect: How the Barzani family stashes money in foreign real estate

According to a leaked ledger of Dubai property data, obtained by the Center for Advanced Defense Studies, Salar Hakim, the husband of the Kurdish president [Masrour Barzani's] late aunt, is the largest identified Iraqi property owner in the city. He is linked to at least 288 different skyscraper apartments across the city, including nearly a sixth of the units at The Grand, a fancy new waterfront tower with an infinity pool. (When contacted, Hakim confirmed he owned the properties, but otherwise declined to comment.)

It’s hard to put an exact price on these assets, but the cheapest properties that are comparable to ones owned by Hakim are worth hundreds of thousands of dollars. Others go for much more. The Kurdish president’s uncle’s full holdings are certainly worth well over $100 million at least and could generate millions in rent every month.

It is hard to imagine a licit reason for Hakim to possess this wealth. He is a successful banker and chairman of the Kurdistan International Islamic Bank, but the bank’s public financial documents do not indicate it generates the profit or is paying its leadership the type of salary that can float these purchases. Neither does it seem plausible that the properties are a legitimate bank investment. The bank’s most recently available annual report shows the only properties it owns are inside Iraqi Kurdistan and worth about $16 million.

... Hakim’s finances are deeply intertwined with those of his relatives. Another of the Kurdish president’s brothers owns part of Hakim’s bank, and the president’s son just sold over $30 million worth of the bank’s shares.

Amberin Zaman for Al-Monitor: Iraqi Kurdistan prime minister to travel to Turkey

Prime Minister of the Kurdistan Region of Iraq Masrour Barzani is set to travel to Istanbul today where he will meet with Turkish President Recep Tayyip Erdogan, Al-Monitor has learned.

... The war in Ukraine and subsequent Western sanctions on Russia, including its oil and gas sales, have prompted a search for alternative energy supplies globally — and Iraq, with its massive hydrocarbon reserves, is an obvious choice.

Chenar Chalak for Rudaw: Iraq’s economy is gradually recovering: World Bank

The increase in oil prices and the easing of COVID-19 restrictions has led to a gradual recovery for Iraq’s economy, according to the World Bank’s April update regarding Iraq’s economy, which projects an overall GDP growth of 8.9 percent in the year 2022.

The rise of the coronavirus pandemic accompanied by the drastic fall in oil prices and a case of political deadlock led to a significant economic downfall for Iraq in 2020, which recorded a negative 8.6 percent GDP growth in that year.

A new report from the World Bank states that Iraq has gradually recovered from the recession of 2020, citing more reliance on non-oil economic activities and better oil market dynamics as reasoning. According to the report, in addition to the global surge in oil prices, oil production has also increased in Iraq due to the OPEC+ production quota tapering.

NASA: Dust storms in Iraq

A dust storm engulfed parts of Iraq for multiple days in early April 2022, turning skies orange, reducing visibility, and degrading air quality.

Dust storms in Iraq are most common in the summer, provoked by the shamal — strong winds that blow from the northwest. But they can occur in other seasons, too.

... The director of Iraq’s meteorological office noted that drought is causing dust storms in Iraq to become more frequent. While the shamal winds are common, drought makes it more likely that eroded material can be lofted into the air.

Hannah Lynch for the Guardian: Iraq's ancient buildings are being destroyed by climate change

Some of the world’s most ancient buildings are being destroyed by climate change, as rising concentrations of salt in Iraq eat away at mud brick and more frequent sandstorms erode ancient wonders.

Iraq is known as the cradle of civilisation. It was here that agriculture was born, some of the world’s oldest cities were built, such as the Sumerian capital Ur, and one of the first writing systems was developed – cuneiform. The country has “tens of thousands of sites from the Palaeolithic through Islamic eras”, explained Augusta McMahon, professor of Mesopotamian archaeology at the University of Cambridge.

Damage to sites such as the legendary Babylon “will leave gaps in our knowledge of human evolution, of the development of early cities, of the management of empires, and of the dynamic changes in the political landscape of the Islamic era”, she added.

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