Top Energy Stories

Insurgents bombed two oil wells at Kirkuk's Bai Hassan field and killed at least one guard. In a dawn raid, militants attacked a guard post and detonated IEDs on wells number 177 and 183, according to an Oil Ministry statement, a Kirkuk security official, and an official with the state-run North Oil Company (NOC), which operates the field. One fire has already been put out, the NOC official said, and the field's recent production level of about 70,000 barrels per day (bpd) has not been affected. IS militants have stepped up their assaults over the past month as part of their so-called "Ramadan raid" campaign, according to multiple Iraqi and Kurdish security officials, who said energy infrastructure around northern Iraq is vulnerable partly because security forces have been redeployed away from oil facilities after they became entangled in oil smuggling schemes. Back in 2019, Iraq Oil Report investigated the problem: security forces sent to stop oil theft were instead negotiating their own stakes in the smuggling rings. In one dramatic incident in March 2019, Oil Police fought a two-hour gun battle near Kirkuk's Jambur field as they tried to stop a smuggling operation protected by a heavily armed force. Prime Minister Mustafa al-Kadhimi has sought to address the problem by redeploying compromised security forces away from oil fields. But now there don't seem to be enough honest Oil Police to stop insurgent attacks. For more details, read the full story on Iraq Oil Report.

Oil Minister Ihsan Ismaael has filed an official objection to several key provisions in Iraq's 2021 national budget law, including problems that would result in payment delays for oil companies. The complaint is the latest indication of serious flaws in the legislation, which was passed one month ago. After the ratified law was published in the government's official gazette on April 12, the Finance Ministry also identified major problems with different parts of the law. In a formal letter dated April 18, which was obtained by Iraq Oil Report, Ismaael lays out detailed concerns related to six different parts of the budget that "will have a negative impact on and will hinder the work" of the Oil Ministry, and asks the general secretariat of the Council of Ministers to "appeal these articles before the Federal Supreme Court." Separately, the Finance Ministry has asked Iraqi President Barham Salih to address another set of problems related to financial allocations. Read the full story on Iraq Oil Report.

Iraq posted a slight increase in oil sales last month, around 21,000 barrels per day (bpd) more than in March, but revenues dipped as global crude prices weakened. Nationwide exports averaged 3.389 million bpd in oil exports in April, up from 3.367 million bpd in March, according to an Iraq Oil Report analysis based on federal export figures from the Iraqi Oil Ministry and northern pipeline export data provided by industry officials. Read the full story on Iraq Oil Report.

The Majnoon oil field is closing in on a big output capacity hike. The director of the field, Dhia Shaker al-Luaibi, talked about the future of the project in an interview with Iraq Oil Report. Production is currently averaging about 130,000 barrels per day (bpd), he said, with developed capacity of about 230,000 bpd. But with the construction of a new central processing facility — which is 70 percent finished, overall capacity will increase to 450,000 bpd. It's part of a broader push to prepare the country's oil sector for a future in which production will not be as constrained by OPEC obligations. Iraqi output fell slightly from February to March, but OPEC quotas are on schedule to ease in May, June, and July, giving Iraq a bit more leeway to push production higher.

A tribal leader in Basra province's Al-Zubair district, Sheikh Kadhim Majeed al-Sarayefi is responsible for sub-contracting at some of Iraq's largest oil fields. He also plays a role as mediator — between oil companies, the Oil Ministry, and his community over employment and agricultural rights, and between tribes when disputes arise. In an interview with Iraq Oil Report, he said the influence of tribes has risen in the past six years due to a proliferation of weapons after military operations against the so-called Islamic State group, rising unemployment, and social issues. Read the full Q&A on Iraq Oil Report.

National News

A devastating fire in Baghdad’s Ibn al-Khatib hospital has highlighted lax safety rules and corruption. Doctors have long warned that hospitals lack smoke detectors and health and safety rules are not enforced. Those problems led to tragedy on April 24, when a fire broke out on the coronavirus ward and could not be controlled, eventually claiming at least 82 lives and injuring 110 people. The death toll could still climb as many of the injured remain in a serious condition. The blaze was reportedly set off by exploding oxygen cylinders, according to the AP’s Samya Kullab and Abdulrahman Zeyad, who write that "fire extinguishers did not work and emergency exits were inexplicably shut." One doctor said the fire spread quickly because the walls of the rooms were padded with plastic and nylon which fed the fire — a type of basic safety violation that is also a problem at other hospitals around Iraq. Health Minister Hassan al-Tamimi initially resisted calls for his resignation, but finally stepped down on Tuesday.

Iraq's faltering vaccination campaign is also part of Tamimi's less-than-stellar legacy. Apathy, fear and rumors are keeping many people from getting vaccinated, despite a spike in coronavirus cases, according to Abdulrahman Zeyad, reporting for AP. Last month, coronavirus cases spiked to their highest number with over 8,000 new cases per day; on Monday, 5,068 cases were reported. Fewer than 380,000 people have been fully vaccinated in a country of 40 million. Iraq has so far received 336,000 doses of the Astra Zeneca vaccine and 49,000 Pfizer doses. The campaign got something of a boost recently, though, when the cleric and political leader Muqtada al-Sadr publicly endorsed vaccinations. Images of him getting the shot inspired many of his followers to head to clinics to get their shots.

A battle broke out near the Iraq-Turkey border on Wednesday when Peshmerga forces controlled by the Kurdistan region's ruling Kurdistan Democratic Party (KDP) clashed with militants from the Kurdistan Workers' Party (PKK). The fighting lasted for half an hour and no casualties were reported, according to NRT. The clashes follow several altercations between KDP and PKK forces in November and December last year in Dohuk governorate, leading to several deaths on each side. NRT writes that the PKK is under pressure from a renewed Turkish offensive in the Kurdistan region. The new Turkish operation began on April 23 and involves airstrikes, shelling, and ground operations.

The controversial Makhool Dam project is threatening to flood the ruins of the ancient Assyrian city of Ashur on the banks of the Tigris river, according to Noam Raydan and Harry Istepanian, writing for the Iraq Energy Institute. The Ministry of Water Resources says it is going ahead with the project, citing concerns over severe water shortages, but geologists are concerned that the "structures of the reservoir are inadequate to support the dam." As well as Ashur, the dam may also threaten at least 184 other archaeological sites in the area. In April, the ministry said the work on the dam will resume this month and will help to increase water storage capacity, generate electricity, and offer "more than 20,000 job opportunities." The project is expected to cost nearly $3 billion and take three years to complete. Concerns over water scarcity in Iraq have been amplified by Turkey’s Ilisu dam on the Tigris river, reducing water flow into Iraq.

Iraq's cultural heritage is also at risk from a lack of modernized museums. Iraq’s National Museum has more than 60,000 manuscripts, the oldest dating back to 1229 — one of the few books that survived the Mongol invasion of Baghdad, writes Simona Foltyn for Al Jazeera English. The manuscripts were largely saved from the ravages of the 2003 U.S. invasion because they were moved to another location, but many of Iraq’s ancient artefacts are being held in museums around the world under the guise of safe keeping. Museum worker Mona Naji Abbas told Foltyn that "we prefer to provide the environment to save our manuscripts inside the country. We realize these manuscripts constitute soft power. Utilizing the soft power will require funding for modernization." The index for the manuscripts is maintained manually, and museum workers are now calling for funding for an electronic index to help preserve Iraq’s heritage.

Climate change poses an existential threat for Iraq's nomadic herders, according to Simona Foltyn, reporting for Al Jazeera in the deserts of Muthanna. Foltyn cites UN figures predicting a 2 degree temperature rise in Iraq and a 9 percent decline in rainfall in the coming decades. While the impact of these changes can already be felt across Iraq, with increased dust storms and farming communities struggling with water shortages and rising soil salinity, it is in the deserts of southern Iraq that 'climate change is spelling an existential crisis for pastoralist tribes" she writes. Wells have long run dry so herders must fetch water by truck from nearby towns. Hardship has forced many Bedouins to sell their livestock. The threat has also driven a wedge between generations of herders, as elders try to preserve their way of life and the young look for futures elsewhere.

Commentary and Analysis

How can Iraq upgrade its banking sector? For the Iraqi Voices podcast, Akel al Ansari discusses the challenges and possibilities for the Iraqi banking sector. Ansari says that there’s been a massive uptick in the number of Iraqis with bank accounts, from less than 5 percent of the population to nearly 43 percent. Many state employees must now open bank accounts in order to access their wages, he says. While this marks an improvement, there are significant historic hurdles to overcome. The sanctions era seriously hobbled Iraq’s banker sector and kept it out of international financial systems, he says, meaning that the banking system now is 25 years behind the rest of the world. A mostly cash-based system also enables corruption, he says. Some international banks came to Iraq in 2003, 2004 and 2005, but those banks left again in 2013 and 2014 for both security and commercial reasons. Because of this, banking technology wasn’t being transferred to Iraq and the industry wasn’t being developed accordingly. But corruption still remains the biggest problem. The answer is centralized digitization so that bank branches can communicate with each other in order to fight corruption and money laundering. This will also necessitate a transaction monitoring system, Ansari says.

Will UN observation solve Iraq’s electoral woes? For Brookings, Marsin Alshamary and Maya Nir lay out the limitations of possible UN involvement in Iraq’s national elections, expected this October. Iraq has requested electoral observation from the UN, following calls from the public and political elites, but the UN has not yet responded. The authors write that election observation is "inherently limited" and that public trust could be damaged if the UN is formally involved but unable to ensure the fairness of the election. The authors also point out that as the elections approach, "signs of strategic manipulation are starting to appear, including the decline in press freedom and in civil society, as well as the intimidation of activists," adding that the UN and international observers should monitor not just the vote but also the pre-electoral environment.

Iraq is facing collapse without reforms. Iraq is dominated by a kleptocratic ruling elite, but if the state can be pressured into introduces reforms to improve governance, then "there is a pathway for the country to realize its potential for stability and democracy," according to Sajad Jiyad, writing for the Century Foundation. Jiyad argues that "stakeholders" and "intervening powers" need to recognize the perils of state collapse and "that it is possible to pull Iraq back from the brink, if there is a collaborative effort that is not based on zero-sum politics. Without such a realization, decision-makers in Iraq and other countries will have to accept instability there as the norm for the future. They will also need to accept that other countries in the region cannot be shielded from that instability."

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