Iraq’s oil production seen at risk by Barclays as winter nears

MAIS AL-AMOURI and CLAUDIA CARPENTER

NEW YORK (Bloomberg) -- Iraq’s oil production is at risk for winter when “loading problems” have historically reduced output by 300,000 bopd to 500,000 bopd, Barclays Plc said.

Loading facilities and the nation’s single-point mooring systems are “insufficient for the winter season,” Michael Cohen, a Barclays analyst in New York, said in a Sept. 25 report. It wasn’t clear from the report what causes the disruptions during winter.

Shipments from Basra in the south are sometimes slowed by strong winds during the first part of the year. In April, a four-mile (6.4-km) line of supertankers was waiting to load the nation’s crude.

OPEC’s second-largest crude producer has increased output this year as supplies from the south expanded even as Islamic State fighters occupied parts of the north. Iraq needs to keep increasing production because lower oil prices have curbed government revenue.

Crude output will increase by about 500,000 bpd to reach 4.5 MMbpd by 2020, or 1.5 MMbpd below the oil ministry’s target of 6 MMbpd, according to Barclays. Production was 4.3 MMbopd in August, the most in the Organization of Petroleum Exporting Countries after Saudi Arabia, according to data compiled by Bloomberg.

Iraqi oil exports will rise to 3.7 MMbpd in 2016 from 3.5 MMbpd this year, Barclays said. Shipments were 3.19 MMbopd in June, a fourth consecutive monthly record, according to the International Energy Agency.