Iraqi Oil Minister expects oil prices to reach over $40 in the second half of 2020

Iraq’s newly appointed oil minister Ihsan Abdul Jabbar Ismail crossed wires, via an interview with Iraq’s Sharqiya TV as reported by Reuters, as saying that the country will export an average of 2.8 million barrels per day (bps) in June. The diplomat also anticipates oil prices to cross $40 during the second half of 2020.

Key quotes

Iraq will export an average of 2.8 million bpd in June.

It’s for Iraq’s benefit to comply with OPEC+ oil cut deal.

Almost all foreign companies responded positively to reviewing service contract terms, but one company rejected.

Will demand Kurdish region to contribute to OPEC+ oil cut quota.

Ministry requested from Kurdish authorities to export maximum of 370,000 bpd of oil as of June to help Iraq abide by OPEC+ quota.

Iraq could stop importing Iranian gas in 2024 if all of its gas projects are completed as planned

Expects June oil revenues to reach around $2.5 billion, including around $500 million to be paid as costs for international companies.

Dues that Iraq should pay to Lukoil amount to around $140 million so far.

Market implications

Given the announcements be ahead of the start of the oil trading, the market impact is yet to be known. However, the nature of the news can be considered as price positive for WTI that closed the previous week around $36.75.