Why doesn't Iraq export oil derivatives?

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[size=52]Why doesn't Iraq export oil derivatives?[/size]

[size=45]Iraq's crude oil production capacity exceeds 5 million and 400 thousand barrels per day, and although production has reached about 4.2 million barrels per day, the country is obligated to export only 3.4 million barrels per day, based on the decision of the OPEC Plus alliance, which reinforces the need to benefit from it. In enhancing the capacity of refineries and converting them into oil derivatives.[/size]
[size=45]Iraq suffers from a shortage and scarcity of petroleum derivatives such as gasoline, gasoline and natural gas, so it imports these materials worth $3 billion annually, according to specialists.[/size]
[size=45]Specialists confirm that if Iraq had sufficient refineries to store the increase in production and operate with high efficiency, it would have been possible to dispense with the import of all these derivatives of gasoline (improved or regular) and kerosene - except for gas - to achieve internal sufficiency with them.[/size]
[size=45]Oil derivatives can also be exported without any restrictions, as there are no quotas for exporting oil derivatives, according to specialists, stressing that the profits in exporting oil derivatives are more than exporting crude oil.[/size]
[size=45]But Iraq's difficult storage conditions, the lack of sufficient refineries, and the delay in completing some refineries meant that the excess produced quantities remained in the fields, and a small portion of them went to the refining sector, according to specialists.[/size]
[size=45]Production reduction[/size]
[size=45]The OPEC Plus alliance decided, in October of last year 2022, to reduce member states’ export quotas by 3.6 million barrels per day, and these reductions were distributed among the countries, according to oil expert, Kawafd Sherwani.[/size]
[size=45]Sherwani explains that “Iraq’s share of it was minus 200 thousand barrels per day, and Iraq is obligated to this share, and it is not permissible to export more than 3.4 million barrels per day, even if it produces 5 million barrels per day.”[/size]
[size=45]He adds, “Any increase that is not useful for export can be used to enhance the capacity of refineries, but Iraq suffers from a lack of refineries to store this increase in production.”[/size]
[size=45]The oil expert continues, “Also, the refineries that are currently operating have a small capacity, because some of them were destroyed during the wars, especially the Baiji refinery, which had a capacity of 300,000 barrels per day, and it is expected to return to service with a capacity of 100,000 barrels per day in the middle of next year.”[/size]
[size=45]Petroleum derivatives[/size]
[size=45]He confirms, “Iraq is facing a shortage and scarcity of petroleum derivatives such as gasoline (improved or regular), gasoline and natural gas, so it imports these materials, and if there were sufficient refineries and they were working with high efficiency, it would have been possible to dispense with their import and achieve internal sufficiency with them, except for gas.” Because his file is different.”[/size]
[size=45]He explains, “Petroleum derivatives can be exported without any restrictions. There are no quotas for exporting oil derivatives, and the profits from exporting oil derivatives are more than the profits from exporting crude oil.” Sherwani points out, “Domestic consumption needs 700 to 800 thousand barrels per day, and if production is more, the excess will exceed the export share and the refinery share, which must be stored or converted to petrochemical industries.”[/size]
[size=45]He explains, “But there are no petrochemical industries yet in Iraq, and there is a project being worked on, but it is very late, and this could have contained the surplus oil produced.”[/size]
[size=45]The oil expert points out that “countries around the world resort to strategic storage if oil production is large and its price is unrewarding, or they transfer it to refineries and export oil derivatives, or they transfer it to petrochemical industries.”[/size]
[size=45]He continues, “Therefore, many countries, such as China and India, which have many refineries, buy cheap oil from Russia, re-filter it, turn it into gasoline and gas oil, and export it to Europe and even America.”[/size]
[size=45]increase production[/size]
[size=45]The Director of the International Center for Development Studies in the United Kingdom, Dr. Sadiq Al-Rikabi, agrees with Sherwani’s delegation regarding the lack of sufficient refineries to store non-exported production quantities, indicating that there are attempts to increase Iraqi oil export outlets.[/size]
[size=45]Al-Rikabi says, “Iraq seeks to increase its production to approximately 6 million barrels per day in the coming years, at a time when expectations indicate that global demand for oil will rise at a rate of two million barrels per day next year, which confirms Iraq’s need to increase its production.”[/size]
[size=45]He adds, “Iraq’s failure to use surplus production at the present time does not mean that it loses all revenues, because there is compensation in the rise in prices that Iraq achieves by increasing its revenues from oil.”[/size]
[size=45]Al-Rikabi concludes his speech by saying: “But if demand increases without Iraq’s production increasing the required quantities, then a loss will occur, and this is what did not happen.”[/size]
[size=45]New platforms[/size]
[size=45]For his part, member of the Parliamentary Oil and Gas Committee, Kazem Jarro, explains, “Current production amounts to 5 million barrels per day, and these cannot be exported, because the existing loading platforms in Basra ports have a capacity of only 3.5 million barrels per day, which requires the construction of new platforms.”[/size]
[size=45]Jarro confirms that “Al-Faw Port, which, if completed, could increase production up to 10 million barrels per day. The 2023 budget also includes a plan to increase export platforms, and the Prime Minister, in turn, formed a committee whose mission is to maintain and rehabilitate the current platforms, while increasing their propulsion and export capacity.”[/size]
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