Some OPEC Members May Agree on Iraq's Special Case in Production Freeze Deal

Baghdad is directly interested in maximizing revenues from oil, and this is only possible if its price rises, according to an OPEC source.

DAMASCUS (Sputnik) — A number of key Organization of the Petroleum Exporting Countries (OPEC) members may back providing special terms to Iraq enabling the country to avoid limiting oil output, an OPEC source told RIA Novosti Monday.

On October 26, Iraqi Oil Minister Jabbar Ali Hussein Al-Luiebi asked OPEC Secretary General Mohammad Barkindo to exclude Iraq from the cartel's possible production freeze as the country is fighting terrorism with its economy suffering from the cost of conflict.

"Baghdad is directly interested in maximizing revenues from oil, and this is only possible if its price rises. So a number of players, including Saudi Arabia, may support special conditions for Iraq without fearing over Baghdad abruptly boosting its output volume," the source said.

Unlike Iran, Iraq has little space for maneuver with regards to diversifying its economy given its current political climate, the source added.

On September 28, the OPEC member states reached an agreement on the sidelines of an international energy forum in Algeria to set a production ceiling of 32.5-33 million barrels per day.

On October 23, head of the state-backed Iraqi company State Oil Marketing Organization (SOMO) Falah Al-Amri said Iraq was not going to reduce the achieved oil production level of 4.7 million barrels per day.

The OPEC countries are set to finalize the agreement on oil output freeze at the OPEC summit in Vienna on November 30. The move has been driven by plunging oil prices and an oversupply in the global energy market.