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Iraq’s semiautonomous Kurdish region could not comply with Baghdad’s request to cut output by 120,000 b/d due to financing needs, but implemented a lesser reduction, a Kurdish minister told Iraq’s state-run TV Sept. 9.
The Kurdish region has cut output by 50,000 b/d at 410,000 b/d, Minister of State Khalid Shwani told the station. Local consumption is around 30,000 b/d, he added.
The Kurdistan Regional Government, or KRG, has delayed salaries to its employees due to the financial crisis gripping the country because of lower oil prices, he added.
The KRG is currently in talks with the government in Baghdad to resolve lingering problems around payment of salaries in the region and transferring oil revenue to the federal government, among other issues.
Iraq, OPEC’s second largest oil producer, has failed for most of this year to comply with the OPEC+ output cuts due to its financing needs. Iraqi officials have also blamed KRG’s independent oil policy for contributing to the country’s noncompliance with the quota.
August compliance
Iraq produced 3.75 million b/d in August, according to the latest S&P Global Platts OPEC+ oil production survey, below its quota of 3.80 million b/d, but still far above its effective quota of around 3.40 million b/d when its compensation cuts are factored in.
The country had previously vowed to implement extra cuts of 400,000 b/d in each of August and September to make up for overproducing in May through July.
Iraqi oil minister Ihsan Ismaael has said the country may ask the OPEC+ monitoring committee for a two-month extension on achieving its extra cuts, which were due to be completed by the end of September.
