Top Energy StoriesIraqi oil production edged lower in October. Aggregate output from fields in both federal territory and the Kurdistan Region of Iraq (KRI) fell marginally in October to 4.30 million barrels per day (bpd) from 4.34 million bpd in September, according to an Iraq Oil Report analysis based on monthly data gathered independently from each of the country's producing fields. The federal government accounted for 3.86 million bpd of total production in October, just below the 3.89 million bpd average in September. Fields in Iraqi Kurdistan combined for about 437,000 bpd, reflecting slight declines in recent months. Read the full story on Iraq Oil Report. 
Authorities in the UK are continuing to prosecute the Unaoil bribery scandal. According to the UK's Serious Fraud Office (SFO): Stephen Whiteley, a former territory manager for Unaoil, was found guilty in July 2020 of paying over $500,000 in bribes to win a $55 million contract for Unaoil to supply oil infrastructure in Iraq. The SFO secured the convictions against Whiteley and three other senior oil executives in an investigation which uncovered schemes to pay a total of $17 million in bribes to win $1.7 billion in contracts for Unaoil in Iraq.
The SFO says it has now recovered almost £100,000 from Whiteley, who has been ordered along with other accomplices to forfeit their illicit gains. The corruption first came to light through an investigation by The Age and Huffington Post, which included internal emails that identified Iraqi oil officials who were apparently receiving bribes, including former Deputy Prime Minister for Energy and Oil Minister Hussain al-Shahristani, former Oil Minister Abdul Karim Luaibi, and former South Oil Company Director General Dhia Jaffar. Those officials have not faced any consequences in Iraq. In-person with Ihsan Ismaael, Salem Chalabi and moreA message from the Iraq Britain Business Council: The IBBC Autumn Conference Nov. 22 in Dubai is a must-attend return to in-person events. Tickets are limited to meet Iraq Minister for Oil Ihsan Ismaael, CEO of the Trade Bank of Iraq Salem Chalabi, BP Iraq President Zaid Alyaseri, and Total Managing Director for Iraq Dunia Chalabi. Attendees will:
- Meet the main stakeholders in Iraq's energy, and finance, and industrial sectors in Iraq.
- Discuss the country’s energy transition.
- Learn how new investments and opportunities in oil, gas, and solar will make Iraq more sustainable and impact your business decisions.
- Network with IOCs, Financiers and top industry leaders to build your business connections and opportunities.
Monday, Nov. 22, 2021, at The Address Hotel, Dubai Marina, UAE. For more details and tickets, click here.
Kadhimi AttackedIran-backed armed groups were responsible for a drone attack on Iraqi Prime Minister Mustafa al-Kadhimi, according to Reuters, citing Iraqi security officials and militia sources. Two regional officials who spoke on condition of anonymity said Tehran had knowledge about the attack before it was carried out, but that Iranian authorities had not ordered it. Militia sources said the commander of Iran's Revolutionary Guards overseas Quds Force travelled to Iraq on Sunday after the attack to meet paramilitary leaders and urge them to avoid any further escalation of violence. Two Iraqi security officials, speaking to Reuters on Monday on condition of anonymity,said the Kataib Hezbollah and Asaib Ahl al-Haq groups carried out the attack in tandem. A militia source said that Kataib Hezbollah was involved and that he could not confirm the role of Asaib.
The attack was a response to Kadhimi's efforts to undermine Iran-backed armed groups, as well as their waning political power after a disappointing performance in Iraq's October elections. Writing for Al-Monitor, Shelly Kittleson reports: Iraq’s Oct. 10 parliamentary elections had seen a political alliance linked to the Shiite-led Popular Mobilization Units (PMU) lose a substantial number of seats compared with those garnered in the 2018 elections, which were held only months after Iraq declared victory against the Islamic State (IS) in the country in December 2017. Protesters supported by political parties linked to armed groups close to Iran — many of whom received training and weapons from Iraq’s eastern neighbor for many years prior to the formation of the PMU in 2014 to fight IS — had been conducting sit-ins near Baghdad’s Green Zone for weeks, claiming election fraud. In recent days, these protests had turned violent. Two were reportedly killed and over a hundred injured between both protesters and security forces.
Right after that that violence, on Nov. 6, Qais al-Khazali, the leader of the armed group Asaib Ahl a-Haq, publicly threatened Kadhimi. The drone attack happened on Nov. 7. Iran probably didn't order the attack. Right after the attack, Esmail Qaani, the successor to Qassim Soleimani as the leader of Iran's Quds Force, traveled to Baghdad to meet with both Kadhimi and paramilitary leaders. Shawn Yuan reports for Al-Jazeera: Already prior to the attack, the militia group Asa-ib Ahl al-Haq’s dissenting role within the ranks of the PMF had opened fissures between the Iraqi militias and Iran; and the attack on Sunday further worried Tehran as it fears its grip on the Shia militia groups is increasingly loosening. For months, Iran-backed Shia militia groups in Iraq have been behind the tit-for-tat exchanges with the U.S. with mortar and rocket attacks aimed at U.S. military sites in Iraq – oftentimes in defiance of Tehran’s de-escalatory stance with Washington on Iraqi soil. Among the militia groups in Iraq themselves, the internal fracture was also widening as Asa’ib Ahl al-Haq group, led by Qais Khazali, repeatedly broke the periodical ceasefire between Kata’ib Hezbollah (KH) – another paramilitary group traditionally loyal to Tehran – and the U.S.
The attempt on Kadhimi's life could be a sign he's doing something right. Iraqis have been frustrated with Kadhimi for failing to bring lawless armed groups to heel immediately, but his incrementalist approach is the result of clear-eyed pragmatism, according to Michael Knights. Writing for the Washington Institute, he argues: Kadhimi’s step-by-step pushback against the militias is a frustratingly slow-burn strategy: one replacement of a compromised officer, one terrorism arrest, and one anti-corruption case at a time. But the arrests are building up, and the court cases are bearing fruit. Such work takes time, and Iraqis are rightfully impatient. Yet while any Iraqi prime minister can easily become a dictator and a death squad commander, Kadhimi does not want rivers of blood in Baghdad if steadily chipping away can reduce the risk to ordinary people. ... It is also quite fitting that this time, the Iran-backed militias bombed the front steps of Kadhimi’s modest house by the Tigris. It was on those exact steps that Qassem Soleimani, the head of Iran’s Islamic Revolutionary Guard Corps (IRGC) Qods Force, stood to offer Kadhimi the premiership in 2018, were he to agree to bend the knee to Tehran and serve as their premier in Iraq. When he declined, they chose Adel Abdulmahdi instead, with his ruinous era of premiership lasting just two years. Kadhimi did become premier afterwards, but not by Iran’s hand, and despite the death threats of Iran and its militias. Now, as Iraq forms a new government after elections, the same militias have laid down a red line that the next premier can be anyone except Kadhimi. That should tell us something.
Government FormationMuqtada al-Sadr is in the driver's seat. After his political movement won the plurality of votes in the new Parliament, Sadr visited Baghdad last week to meet with, among others, former Prime Minister Haider al-Abadi, Parliament Speaker Mohammed al-Halbusi, and Ammar al-Hakim. Reporting for Al-Monitor, Adnan Abu Zeed writes: Riyad al-Massoudi, a leading official in the Sadrist movement, told Al-Monitor that ... "[Sadr's] discussions with the Shiite, Sunni and Kurdish forces stem from his confidence that he is able to build strong political alliances and announce the formation of a new Cabinet in the near future, after winning the voters’ confidence and obtaining a number of votes that cannot be compared to the other forces.” He said that the movement “began preparing for the post-Cabinet formation phase and the strategies for future policies.” ... However, things aren't that simple in the eyes of the Coordination Framework, which rejects the election results. The Coordination Framework consists of the State of Law Coalition, Fatah Alliance, Asaib Ahl al-Haq, National Wisdom Movement, Victory Alliance and Ataa Alliance, which are trying to form a larger bloc to prevent the Sadrist movement from forming a Cabinet. Hisham al-Rikabi, spokesperson for the State of Law Coalition, told Al-Monitor, “Negotiations to form a government are out of the question for the parties within the Shiite Coordination Framework, as the objections to the election results and demonstrations continue.” He added, “The Coordination Framework’s parties are preoccupied with finding a way out of the crisis, not with the government formation.”
Could Iraq see its first post-2003 majority government? Patrick Osgood writes for Control Risks: As losing parties grasp for leverage, Sadr likely sees a one-time opportunity to break free from Iraq’s the conventions of Iraqi governance, in which all parties join in rudderless governments in exchange for apportioned control of ministries and agencies. He has advocated for a majority government that will leave out losing parties, an untested proposition in Iraq’s post-2003 governing system. He has also stated willingness to a sustained US military assistance mission in Iraq after its combat mission formally ends on 31 December. These messages are welcome in Washington, whose influence in Baghdad has atrophied to the point where their best hope is that Sadr, whose movement has been defined partly by its anti-Americanism, can act as a bulwark against Iranian influence from Fatah and its stablemates. But foreign stakeholders cannot afford to be so credulous of Sadr’s reformist, nationalist message. Although Iraq’s electoral system has changed, its ossified, ethno-sectarian political system has not. Despite Sadr’s recent call to exclude losing parties in the new government, he will likely compromise with his Iran-backed rivals. A business-as-usual coalition government remains the most likely outcome. Sadr’s promises of structural political changes, and post-2021 military cooperation with the US will likely be on the negotiating table.
The protest movement is coming to Parliament, after protest-aligned candidates overcame long odds to win several seats. They face even more daunting challenges as they try to fulfill expectations to turn their power into structural change. Renad Mansour writes for Foreign Affairs: Together, these groups and figures could form an important slice of the new parliament. They have claimed that they will not take part in the usual horse-trading that comes after an election as parties wrangle over access to state coffers but will instead use their seats to form an opposition to the ruling consensus. At stake here is the emergence of something that has never really existed in Iraq’s recent history: an opposition within the parliament. Instead of the usual national consensus governments that bring together all sides, these MPs seek to forge a significant bloc that can represent those Iraqis who do not benefit from existing patronage networks. If they can survive as an integral bloc over the next four years, they hope to win even more votes and build an even bigger opposition bloc in the next election, holding out the prospect of greater accountability and incremental reform coming from within the system—a possibility that many Iraqis have given up on. Nevertheless, this coalition of parties affiliated with the protests faces an uphill battle. ... The ruling elites are experienced in dividing, threatening, and silencing such threats. For their part, the MPs affiliated with the protests are not part of a coherent bloc and are, in many cases, new to politics. They must square a circle; they will have limited ability to effect change in a parliament tilted against them, but their inability to effect change will be held against them in the next election cycle. At times they will also risk being divided, given that they represent not a single entity but many small movements. They may lose the confidence that many desperate Iraqis bestowed on them. In the best-case scenario, these MPs will endure in parliament as a coherent group while maintaining relations with civil society and protest movements and building ties with reformists within the Iraqi government, in the process strengthening the connective tissue of reform.
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