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Iraq
by David Pascoe
Posted September 27, 2006
This and other three texts below contain short summaries on the status of the nation states that now have, and will in the future, the greatest effect on oil prices. They have been kept separate from the body of the report The Future of Fuel Prices because they are essentially political in nature.
The subject of Iraqi oil has been politically off-limits from the day of the invasion, as if the reason for the invasion were to take that oil by means of theft. Nevertheless, Iraq is the number two nation in proven conventional oil reserves, and Iraq does continue to produce oil and will continue to do so at an increasing rate.
Having been controlled by a war-mongering dictator for the last 30 years, this nation has never been thoroughly explored. But since 2003 a fair amount of seismic exploration has been done sufficient to raise predictions that this nation probably has more oil than Saudi Arabia. While that has yet to be proved, the fact remains that Iraq possesses enormous reserves estimated (pre 2003) at 112 billion barrels, and certainly more than that.
Iraq is currently producing at only half of existing capacity at 1.5 mb/d (million barrels/day). Her pre '03 production ran as high as 3.0 mb/d, but usually closer to 2.5 due to poor maintenance and management. The pre war state of infrastructure is said to be poor and typical of most oil nations run by dictators. In contrast, the current oil minister claims that the nation is capable of 6 mb/d and has set that as a target. However, only the northern Kurdish region is sufficiently secure for any serious development to take place. For the foreseeable future, Iraq must concentrate on defeating an insurrection.
As for Kurdistan, new developments are proceeding, including several new wells coming on line plus repair and placing into operation of an existing pipeline to Turkey capable of a half-million b/d. Every little bit helps.
If the insurrection could be quelled today, Iraq could single handedly solve the price problem and create a glut on the market within five years, but no one is placing any bets on that happening. The best that can be said at present is that the odds moderately favor the government getting the upper hand since the vast majority of people do not want to see the nation partitioned, and neither are they about to surrender it to the likes of Al Qaeda or the Ba'athists.
Contrary to the notion of Americans stealing the oil, a Finnish company is spearheading the efforts in Kurdistan. Though certainly American companies will have the advantage Iraq-wide, a legal system to deal with "who gets and does what" is yet to created by the government. Thus, though Iraq could up its production significantly in the near term, the possibility of 6 mb/d remains just that.
Back to The Future of Fuel Prices
Posted September 27, 2006
Visit davidpascoe.com for his power boat books David Pascoe - Biography
David Pascoe is a second generation marine surveyor in his family who began his surveying career at age 16 as an apprentice in 1965 as the era of wooden boats was drawing to a close.
Certified by the National Association of Marine Surveyors in 1972, he has conducted over 5,000 pre purchase surveys in addition to having conducted hundreds of boating accident investigations, including fires, sinkings, hull failures and machinery failure analysis.
Over forty years of knowledge and experience are brought to bear in following books. David Pascoe is the author of:
In addition to readers in the United States, boaters and boat industry professionals worldwide from nearly 80 countries have purchased David Pascoe's books, since introduction of his first book in 2001.
In 2012, David Pascoe has retired from marine surveying business at age 65.
On November 23rd, 2018, David Pascoe has passed away at age 71.
Biography - Long version