KEY POINTS
- Iraq’s oil production in September reached 3.94 million bpd, below the OPEC+ quota.
- Reduced exports and lower output from the Kurdistan Region impacted production.
- Iraq implemented production cuts to correct earlier overproduction.
Iraq’s oil production in September reached 3.94 million barrels per day (bpd), falling short of its OPEC+ quota of 4 million bpd, according to a government official. The reduction reflects Iraq’s efforts to boost compliance with the output targets set by the OPEC+ alliance.
Despite a recent survey suggesting Iraq exceeded its production target by 90,000 bpd, the official stated the drop was due to a decline in exports, decreased domestic consumption, and lower output from the Kurdistan Region.
Compliance efforts to correct overproduction
Iraq had planned to cut production to between 3.85 and 3.9 million bpd in September, aiming to compensate for earlier overproduction.
This adjustment aligns with the compliance measures discussed during a recent OPEC+ meeting, where Iraq, along with Kazakhstan and Russia, committed to compensation cuts totaling 123,000 bpd for September and additional reductions in the following months.
According to Reuters , the compliance issue remains a focal point for OPEC+, especially regarding Iraq and Kazakhstan. Both nations have pledged further production adjustments to meet their obligations.
At the OPEC+ meeting, officials from Iraq confirmed their adherence to the promised cuts. However, the production cuts and regional challenges highlight Iraq’s struggle to balance output with international commitments, particularly as the global oil market remains sensitive to supply fluctuations.
Impact on market outlook
The official acknowledged that Iraq’s September production reflected operational challenges, with regional unrest and reduced exports adding complexity.
In the Kurdistan Region, internal disruptions further constrained output. Iraq’s lowered output aligns with its goal of maintaining compliance to ensure market stability and meet OPEC+ targets.
Iraq’s adherence to the cuts marks a shift in its production strategy, which previously faced criticism for overproduction. The outcome of these compliance efforts will be closely monitored, particularly as OPEC+ continues to focus on balancing the global oil market.
