14 hours ago
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An economist warned against Iraq following the Saudi monetary policy, and while stating that the latter has its own reasons for reducing oil production, he stressed the need to beware of a “new variable” with the Turkish side that might wreck oil revenues and the budget.
The economist, Nabil Al-Marsoumi, said in a press interview seen by “Takadum” that “the absence of a strategic horizon for economic thinking in Iraq prompted it to be subordinate to the Saudi monetary policy,” noting that “Saudi policy has its strategic priorities, and one of the reasons for its agreement with Russia to reduce oil production Because of the great loss suffered by the National Bank of Saudi Arabia, one of the major investors in the Credit Suisse Bank in Switzerland,” which has recently collapsed.
Al-Marsoumi continued, “The dependence of the Iraqi monetary policy on Saudi Arabia will lose a lot, because Saudi Arabia today has a basic oil production line of 11 million barrels per day, while the baseline for oil production in Iraq amounts to 4.6 million barrels, and this indicates a large gap in numbers.”
He explained that "Iraq is forced to reduce oil production due to Saudi pressure, and as a result it will not be able to proceed with the development of its production capabilities. Iraq plans to have oil production at 6 million barrels per day in 2027 and has signed with the French company Total to raise oil production in one of the fields." "The procedures and policy of reducing production collide with Iraq's presence in OPEC."
He added, "The oil countries have economic and social buffers to face the crises, including the possession of large sovereign funds that can absorb any crisis, on the other hand, Iraq does not have any buffer other than its cash reserves."
Al-Marsoumi stated, “The new variable that appeared for Iraq is that Turkey refuses to allow the resumption of Iraqi oil exports, and demands the settlement of financial requests from 2018 to 2022 before allowing Iraq to export oil from the Kirkuk fields, and this means that Iraq will be affected by stopping 450,000 barrels and not flowing abroad.” ".
He stressed that "this new variable may ravage oil revenues and the budget, because Iraq is bound by its agreement with Kurdistan, to receive the value of 400,000 barrels of oil and pay the share of 16 trillion dinars in the 2023 budget."
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