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Iraq's oil output shrinks as fuel shortages mount
By Abdulatif al-Mawsawi
April 12, 2006

Iraq's oil production has shrunk to 1.8 million barrels a day, way below average output rates prior to the 2003 U.S.-led invasion of the country.

Despite U.N. trade sanctions, Iraq was pumping more than 2.5 million barrels a day then with plans underway to boost output to nearly three million barrels by the end of 2003.

Oil Ministry sources, refusing to be named, said the Ministry's efforts to boost output have failed with technicians even fearing further slumps in production.

Nearly 1.5 million barrels come from the southern fields which are almost earmarked for export.

But the sources said the region of Basra, where the producing oil fields are situated, was unstable and prone to an upsurge in violence with a bearing on the oil industry there.

They said violent attacks, some involving oil installations and workers, have increased recently.

The northern oil fields of Kirkuk, which used to churn out about 1 million barrels before the U.S. invasion, now produce about 300,000 barrels a day for local consumption.

Iraqi refineries, the sources said, were working much below their previous 600,000 barrels a day capacity, forcing the country to import huge quantities of fuel.

Fuel imports now consume most of the country's oil money.

It is estimated that Iraq pays nearly $6 billion a year to meet its fuel import bill, about twice as much as it pays to cover food imports.

The twin-pipeline via Turkey, which under former leader Saddam Hussein shipped more than 800,000 barrels a day to terminals in Turkey for exports has been shut since the invasion.

The sources said the violence-ridden region of Kirkuk makes it hard to operate the pipeline.

Even the country's so-called Strategic Pipeline, which allowed the ministry to ship crude from the northern fields to terminals on the Gulf and from the southern fields to terminals in Turkey is now out of order due to sabotage.

Original Text