OPEC: No oil supply shortage due to Iraq unrest

BRUSSELS, Belgium – The head of OPEC on Tuesday, June 24, said there was no oil supply shortage due to the crisis in Iraq and that any increase in price on the markets was due to speculative trading.

“Right now the market is very well supplied,” said OPEC Secretary General Abdullah El-Badri, on a visit to Brussels for talks with European Energy Commissioner Guenther Oettinger.

“There is no shortage on the oil market in any place in the world. Of course there is an uprising in Iraq, but this has not affected the production area,” El-Badri said.

Global oil prices have risen from around $109 a barrel to 9-month highs of over $114 on the back of the crisis, but are nowhere near what analysts predict they could reach if Iraq were to halt exports.

“We are ready for any unseen circumstances. If there is a problem in the market we stand ready to solve this problem,” the OPEC chief said.

The price rise seen on the oil markets was “not because of shortage but because of speculation,” he added.

Iraq, faced with a massive jihadist offensive that threatens to split the country, is a leading OPEC oil producer at more than 3 million barrels per day (mbpd) and more than 11% of all known oil reserves.

In May, Iraq produced 3.37 mbpd of crude oil mainly from oilfields in the south along with others near the northern city of Kirkuk, according to the International Energy Agency.

Among OPEC members, Iraq ranks behind Saudi Arabia but ahead of Iran and Kuwait. It has proven crude reserves of 140.3 billion barrels and 3.158 trillion cubic meters of natural gas, according to cartel figures. – Rappler.com