The International Energy Agency said on Tuesday that Iraq’s contribution to the international oil market will significantly enhance to more than 8 million bpd by the year 2035, which is much better its present output.
In its “Iraq Energy Outlook” report, the IEA said the country’s oil and gas reserves would play a major role to its own future. It is playing an essential role in alleviating the international energy markets as well.
It is anticipated that the global market of oil supply will be dominated by Iraq over the coming decades and the country will become the world’s largest oil exporter after Russia by the 2030s.
“Developments in Iraq’s energy sector are critical to the country’s prospects and also for the health of the economy,” Fatih Birol, chief economist and the report’s author said.
He added that success is not guaranteed and failure to obtain the expected optimization in Iraq’s oil supply would put the international markets on course for troubled waters.
The report says that one of the major obstructions to Iraq’s more important role is the supply of electricity in the country with “supply insufficient to meet demand” and building a modern electricity system, which is accepted by the report as an “immediate priority.”
According to the report, Iraq should invest over $530 billion in its energy sector for the betterment of the country to realize its potential by the year 2035, however it would manage to obtain much more than its investment with receipts predicted to top $5 trillion over that period.
Brent crude [LCOCV1 113.21 1.39 (+1.24%) ] has been rising in recent days, hitting $113 a barrel as continued tensions between Syria and Turkey have raised concerns about supply disruptions.
The head of energy research at Deutsche Bank Mark Lewis said the Syrian conflict and the unstable global economy is now affecting oil prices.
“The range of Brent crude that we’ve been seeing lately, the last two or three months, where it has ranged between $100 to $110 a barrel, tells us that despite the rather gloomy economic outlook there are still concerns about production and supply so anything that adds to tensions will add to bullish sentiment in the oil price,” he said.