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Iraq ‘definitely’ abiding with agreed Opec cuts

12 Jan 2017 07:52 GMT
Iraq ‘definitely' abiding with agreed Opec cuts

Abu Dhabi, 12 January (Argus) — Iraq will "definitely" comply with the production cuts it committed to under the Opec deal in late November to curb the group's collective output, oil minister Jabbar al-Luaibi said.

"We are definitely, definitely, certainly abiding with the Opec obligation and the Opec agreement," al-Luaibi said at an industry event in Abu Dhabi.

Iraq has agreed to reduce its production by 210,000 b/d in the first half of 2017 as part of a wider Opec agreement to cut total group production by 1.2mn b/d.

Al-Luaibi said earlier this week that Iraq had already cut production by 160,000 b/d since the beginning of this year.

But al-Luaibi today said Iraq's exports were now down by 170,000 b/d from the October baseline on which the November Opec deal was based. "We have already reduced our exports by 170,000 b/d… and before the end of this month, we will knock down another 40,000 b/d," he said.

The mention of exports rather than production may be to emphasise the removal of these supplies from the global market, although this could not be confirmed.

Complying with the Opec agreement "is our policy," al-Luaibi said. "It is a firm policy and we will not deviate an inch from this policy."

Front-month Ice Brent futures are holding at around $55/bl, about $9/bl or 20pc higher compared with late November, before the Opec deal was struck.

Al-Luaibi said he is "satisfied [with the price] somehow," but hoped "for a better improvement." Asked what price he would be satisfied with, Al-Luaibi said "$65/bl or something like that."