Iraq's crude exports steady as domestic demand rises

LONDON - Iraq's crude oil exports through the Gulf in December were little changed from a month earlier as the onset of winter boosted domestic demand for heating fuel, local shipping agents said.


Published: Sat 3 Jan 2004, 9:59 PM

Last updated: Wed 1 Apr 2015, 11:59 PM

Shipments from the Basrah Oil Terminal rose 4 per cent to 1.55 million barrels a day. Monthly exports have risen by an average of 30 per cent since July, after Saddam Hussein was ousted by US-led forces in April. Exports are still short of the 1.73 million barrels a day in February, the last full month before the war.

"Export volumes in December remained steady as oil was used internally to help alleviate shortages of heating fuel," US Corps of Engineers spokesman Richard Dowling said in a telephone interview from Baghdad. The corps is helping to restore Iraq's oil industry from the war.

The rise in demand for heating fuel during the cold months has been compounded by a shortfall in domestic oil production in Iraq. Looting and sabotage along pipelines has cut shipments from refineries, while the US-led occupation authority isn't importing enough fuel to alleviate shortages, the United Nations said last month.

About 48 million barrels of Iraqi Basrah Light crude moved through the Basrah Oil Terminal in December, up 3 million barrels from a month earlier, according to the ship agents. The total also includes a 2-million-barrel cargo that began loading at the end of November.

The Seaking was the last tanker to take on its 1 million- barrel cargo at the terminal. Another two vessels that began loading at the end of December will finish this month, the ship agents said.

About 45 per cent of last month's exports were delivered to the US, for oil companies including ChevronTexaco Corp. and ConocoPhillips. The rest were shipped to refiners in Japan, India, Taiwan, Spain and Italy. Revenue from oil sales is used to rebuild Iraq and feed its people.

The Basrah terminal is one of Iraq's three oil facilities in the Gulf and has been the only outlet for regular crude exports. It has a daily capacity of 1.9 million barrels.

Temperatures in Baghdad during December average 6 degrees Celsius (42 degrees Fahrenheit), according to the UK-based Meteorological Office. Northern Iraq would be worst affected by shortages of heating fuel, where temperatures in the mountains can fall below zero degrees Celsius.

"Although Iraq's refineries are able to produce oil products such as kerosene and diesel, the infrastructure is handicapped by the lack of maintenance and investment under the previous regime," Dowling said. The country has relied on imports of oil products from its neighbours Turkey, Kuwait and Syria.

To meet internal needs for heating fuel, Iraqi exports are likely to level off between 1.5 and 1.6 million barrels a day over the next few months, he said.

Iraq is targeting first quarter exports of 2 million barrels a day, the country's oil minister Ibrahim Bahr Al-Ulum said last month. This includes 300,000 barrels a day from its Kirkuk oilfields in the north, which is pumped along a pipeline to the Turkish export terminal Ceyhan on the Mediterranean coast.

Plans to start pumping crude along this pipeline have failed because of persistent acts of sabotage. There have been no shipments from Ceyhan since June, when Iraq shipped about 8 million barrels of Kirkuk crude that was held in storage during the war.

The Basrah Oil Terminal has four berths that are operational, though only three vessels are loading oil at the same time. It takes about two to three days for a 2 million-barrel tanker to load.

A second offshore terminal, Khor Al-Amaya, is being repaired and will probably open in the second half of 2004, with a capacity to ship 400,000 to 700,000 barrels a day, Al-Ulum said. A smaller port, Khor Al-Zubair, currently handles imports of oil products such as gasoil and liquefied petroleum gas.

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