Analysis-Iraq's push for bigger OPEC quota driven by revenue pressures, new oil investment

By Ahmed Rasheed and Sarah El Safty

DUBAI, June 29 (Reuters) - An economical situation caused by the Iran warfare and a caller surge of concern by lipid majors are driving Iraq's assertive propulsion for a higher OPEC accumulation quota, perchance placing it connected a collision people with the shaper bloc.

The unit from Baghdad adds to the challenges confronting the ‌Organization of the Petroleum Exporting Countries, inactive reeling from the conflict's fallout and the daze departure of the United Arab Emirates aft astir 60 years arsenic a member.

The war, which forced ‌huge export cuts, has aggravated discord among the group's halfway Gulf members.

Iraq — among OPEC's 5 founding members and its second-biggest shaper — took a large economical deed arsenic the lipid proceeds accounting for the bulk of authorities revenues dried up.

"Iraq's request for a larger OPEC ​quota is chiefly a effect to mounting economical pressures," said an Iraqi vigor adviser, who declined to beryllium named owed to the sensitivity of the issue.

"Export disruptions and war-related losses person accrued the request for higher production."

With the fragile U.S.-Iran truce present promising to unblock the Strait of Hormuz, Iraq is successful a unreserved to replenish its coffers and considering each disposable options if its OPEC quota is not importantly increased.

It has adjacent weighed leaving the bloc, sources told Reuters past week, though Prime Minister Ali Faleh al-Zaidi said successful a connection connected Friday it had not discussed specified a move.

The condemnation that it should beryllium reaping much from its lipid resources ‌has been reinforced by a drawstring of multi-billion-dollar deals signed since aboriginal ⁠2025 with lipid majors that for years shunned Iraq owed to its instability.

BP has committed up to $25 cardinal to redevelop 4 elephantine fields successful Kirkuk. TotalEnergies is executing a $10 cardinal task successful Basra. ExxonMobil signed a woody to make the monolithic Majnoon field. And Chevron has besides mulled a return.

Yet, with those commitments and a ⁠possible loosening of quota restraints, immoderate experts inactive question whether Iraq tin flooded monolithic infrastructure requirements and lingering execution risks to realise its ambitions.

MORE BARRELS, MORE REVENUE NEEDED

Even among the Gulf's oil-dependent economies, Iraq's stands out.

Oil accounted for 88% of its authorities revenues past year, according to World Bank data, among the highest successful OPEC. Saudi Arabia, by comparison, depended connected lipid for astir 55% of its authorities revenue, concern ministry information showed.

The deed from the warfare has been ​aggravated ​by Iraq's deficiency of an alternate to the Hormuz strait for large-scale lipid exports. Iraq pumped 1.48 cardinal barrels ​of lipid per time successful May, according to OPEC data, down from astir 4.2 ‌million bpd successful February earlier the waterway's effectual closure.