According to Energy Intelligence, Iraq's Deputy Prime Minister Ali Allawi envisages oil production capacity rising to no more than 6 million barrels per day over the next five years due to constraints weighing on the industry's expansion.
Iraq is OPEC's second-largest producer. Currently, the country is trying to increase production in line with the OPEC+ production expansion agreement that the cartel signed last year following a gradual recovery in demand.
Per OPEC's latest Monthly Oil Market Report, Iraq produced about 4.4 million bpd in May, down from 4.426 million bpd in April. The May average production was also lower than Iraq's production rate for the last quarter of 2021. Iraq was pumping nearly 4.5 million bpd before the coronavirus pandemic decimated demand and prompted OPEC and its partners to cut production severely.
Despite political problems and doubts about the future of investment in Iraq's oil, the country's Oil Minister Ihsan Abdul Jabbar Ismail intends to increase production capacity to 8 million barrels daily by 2027.
According to him, 6 million bpd was a more realistic target for production capacity expansion.
Meanwhile, Big Oil is leaving Iraq, which is one of the reasons for the uncertainty of its oil industry growth's future. Earlier this week, the news broke that state-owned Basrah Oil Company would buy Exxon's stake in the West Qurna 1 oil field.
Iraq is also expanding its LNG production amid growing global demand. Just this week, the country announced the first shipment of liquefied natural gas from the port of Umm Qasr. Plans are to also export compressed and semi-cooled liquefied gas.
