Iraq exported 2.509 million b/d of crude in April, all from its southern oil terminals as the country's northern export pipeline remained inoperable.
April exports were 112,000 b/d more than the 2.397 b/d exported from the country in March, but still well below February's rate of 2.8 million b/d, which was the highest since 1979, just before the Iraq-Iran war. The figures are derived from daily terminal status reports, obtained exclusively by Platts.
The decline since February is primarily attributable to the suspension since March 2 of exports through the Iraq-Turkey pipeline due to a major sabotage attack in northern Iraq. Insurgent threats have prevented repair crews from traveling to the site of the attacks and it remains unclear when the damaged pipeline will resume operations.
Nonetheless, Iraq set a new post-war record in April for exports through its southern terminals, surpassing the previous 2 million b/d record established in February 2013.
The daily terminal status reports for April shows clear weather the Persian Gulf for the entire month enabling pumping and loading to continue uninterrupted.
They also show that all jetties at the Al-Basrah and Khor al-Amaya terminals were operational throughout the month, as well as the two Single Buoy Moorings that Iraq has brought into operation in the Persian Gulf to date. However, the Khor al-Amaya jetties were vacant for significant periods in April due to the unavailability of compatible tankers.
Without logistic constraints, Iraq's southern exports could have been even higher as production launches in the past six months at three major southern oil projects in southern Iraq have boosted the region's output capacity. The Majnoon and Gharraf oil fields were brought on stream in October 2013, adding a combined 250,000 b/d of new production capacity. In March, the West Qurna 2 oil field, operated by Russia's Lukoil, started pumping 140,000 b/d of crudem the rate contractually required for Lukoil to declare commercial production and start recovering costs.
Platts has calculated that, based on the highest southern export rates of 2.31 million b/d achieved by Iraq in August 2013 and last month, the total volume of crude available for export from the southern oil terminals is about 2.7 million b/d. The figure includes about 130,000 b/d of output from the Ahdab field, which is technically considered part of Iraq's northern oil supply although the crude is exported through the Persian Gulf.
The actual export data for April indicate that 200,000 b/d of potential output was curtailed during the month, due mainly to technical limitations on pumping rates from southern-area oil fields located about 200 km distant from Gulf terminals. The combined rate achievable by pumping stations at the southern oil fields during periods of clear weather with no constraints on jetty availability thus appears to be peaking at 2.5 million b/d.
A 293,000 b/d drop in Iraq's northern oil exports since February at a time when the country's 7 million barrels of northern storage capacity is full indicates that, since the beginning of April, Iraq has had no choice but to shut in about 200,000 b/d of northern production. The northern pipeline shutdown also prevented the export of 100,000 b/d of crude from Iraqi Kurdistan from being exported through the federal export system.
The Kurdistan Regional Government had pledged to start those exports April 1 in a "goodwill gesture" aimed at settling its protracted dispute with Baghdad over oil jurisdiction and payments. Instead, the KRG has recently started direct exports of 100,000 b/d of crude to Turkey through a new export pipeline, bypassing the federal system.
In consequence, total production curtailments from Iraq appears to have reached 500,000 b/d in April. Limited pumping capacity in the south and continued attacks on the northern pipeline suggest limited near-term prospects for reducing the capacity overhang.
Based on the April export figures and taking into consideration the estimated internal supply rates to refineries and power station, mixed residues added to exports and variations in stock levels, Platts estimates that Iraq's crude production in April averaged 3.3 million b/d, down from 3.41 million b/d recorded for February.
An oil ministry spokesman said April oil revenue totaled $7.576 billion at an average realized sales price of $100.60/b; compared with revenue of $7.507 from oil sold at $101/b in March.
