BAGHDAD: Oil exports from southern Iraq have held near a record high in December, cementing its role as the world’s fastest source of supply growth in 2015 despite battles against Islamic State and concern that plunging oil prices would undermine output growth.
The strong supply from Iraq is an indication of continued high output from leading members of the Organization of the Petroleum Exporting Countries, which kept its year-old policy of no output restraints in place at a meeting on Dec. 4.
Iraq’s southern exports in the first 29 days of December averaged 3.27 million barrels per day (bpd), according to loading data tracked by Reuters and an industry source.
That almost matches the record of 3.37 million bpd reached in November – which Iraqi officials said was unusually high as it included some tankers delayed from the previous month.
“These are very strong numbers, although I do wonder if they are running close to the limit of pipeline capacity,” said the source, who monitors Iraq’s shipments.
A few days of maintenance on Iraq’s Single Point Moorings, terminals that handle almost half of Iraq’s southern exports, earlier in December could have slowed shipments.
Iraq surprised many in the oil market this year by boosting supplies by around 500,000 bpd, despite unrest and concern that spending cuts by companies developing the southern fields would limit production growth.
The December shipments suggest unexpectedly high exports have continued for a second month. Iraqi officials initially said November’s record would be hard to match, but have since put exports even higher.
On Dec. 20, the deputy chief for operations and production at the state-run South Oil Company said exports had been running at 3.45 million bpd so far in December.
The southern oilfields produce most of Iraq’s oil. Iraq also exports smaller amounts from the north by pipeline to Ceyhan in Turkey.
Northern shipments, offline for much of 2014, have risen this year despite tensions between Baghdad and the Kurdistan Regional Government over budget payments.
Independent KRG exports averaged 550,000 bpd in the first 29 days of December, according to loading data, down from 600,000 bpd in November, while Iraq’s State Oil Marketing Organisation has exported no northern crude for a third month.
Iraqi officials and oil analysts expect further growth in the country’s exports next year, but at a slower rate than 2015.
