’S oil production is on course to more than double by 2020, the International Energy Agency said yesterday, although delays to investment could tighten the global market in coming decades and push prices higher.
In its Iraq Energy Outlook, the Paris-based IEA said Iraq’s oil production would reach 6.1bn barrels per day (bpd) by the end of this decade under its central scenario.
But that rate would be half of that implied by Iraq's targets signed with foreign oil companies and the IEA, which advises 28 industrialised countries, highlighted the risk of production rising more slowly than expected.
“This report anticipates movement towards possible trajectories for oil output lower than that implied by current contracts,” the report said.
Iraq’s oil production, which stagnated for years due to wars and sanctions, started to rise in earnest in 2010, after Baghdad secured contracts with companies such as BP, Exxon Mobil, Eni and Royal Dutch Shell.
Industry executives say that while Iraq, holder of the world’s fourth-largest oil reserves, has enough oil in the ground to hit its target of 12m bpd, infrastructure bottlenecks, red tape and bureaucracy make that unlikely by a contractual deadline of 2017.
The IEA’s report also presented a delayed scenario, in which energy investment in Iraq rises only slowly from 2011 levels, leading to oil production of 4m bpd in 2020 and 5.3m bpd in 2035.