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2020-03-31 13:30:00

IRAQ'S OIL PRICE $20

IRAQ'S OIL PRICE $20

PLATTS - 30 Mar 2020 - Iraq, OPEC's second-largest oil producer, is selling its crude at an average of $20/b and plans to talk to international oil companies about their payments and contracts, the country's oil minister said, Iraqi news outlet al-Mirbad reported Monday.

Iraq is selling around 70% of its crude exports to Asia, Thamer al-Ghadhban said, al-Mirbad reported.

The ministry is also in talks with IOCs over the best way to move forward given the low oil prices and their impact on Iraq's economy and finances, he said.

There is a need to reach an agreement, whereby the IOCs' payments are not a burden on the government's limited finances while at the same time making sure the IOCs continue to operate in the country, he said.

Iraq is struggling to shore up its finances despite its ability to pump at will as of April 1 following the breakdown of OPEC's talks earlier this month.

The oil price crash, outbreak of the coronavirus and lack of a permanent government in the country are exacerbating an already fragile economic situation.

Brent was recently trading 6.12% lower at $26.24/b.

Postpone payments

Iraq 's state-run Basrah Oil Co. has asked four international oil companies operating in the country to cut budgets by 30% and postpone payments to subcontractors due to the oil price crash.

The March 22 letter from Ihsan Ismaeel, Basrah Oil's director general, was sent to BP, lead operator of the Rumaila oil field, Italy's Eni, which works at the Zubair field, ExxonMobil, operator of West Qurna 1, and Russia 's Lukoil, which works at West Qurna 2. The fields have a total production capacity of about 3 million b/d, well above more than half of the country's total output.

The letter, seen by S&P Global Platts, requests IOCs to reconsider work programs and reduce budgets by 30%, inform BOC of their ability to postpone or halve payments in Q1 and Q2 and amend contracts with subcontractors to include "deferred payment plans."

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Earlier:

IRAQ'S OIL PRICE $20
2020, March, 27, 14:00:00
OIL PRICE: NEAR $26 AGAIN
Brent was down 40 cents, or 1.5%, at $25.94 a barrel, WTI was up 11 cents, or 0.5%, at $22.71.
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Tags: IRAQ, OIL, PRICE