Iraq to Raise Light Crude Exports

Iraq plans to increase the production and exports of light crude oil to 1 million barrels per day in 2019, as part of its strategy to boost state revenue, its oil minister Jabar al-Luaibi said on Sunday.

Light crude oil is a new grade with an API gravity of around 34-43, while the current Basrah Light grade that Iraq exports will be renamed Basrah Medium, one Iraqi industry source familiar with the matter said, Reuters reported.

The American Petroleum Institute gravity, or API gravity, is a measure of how heavy or light petroleum liquids are compared to water. Crude oils with an API gravity of above 31 are considered light.

“This decision will boost Iraq’s position in the global oil markets by producing three crude grades: light, medium and heavy,” al-Luaibi said in a statement. 

Iraq is OPEC’s second-largest producer after Saudi Arabia and pumps around 4.6 million bpd. The majority of its crude exports go to Asia. 

The bulk of Iraq’s oil is exported via the southern terminals, which account for more than 95% of the OPEC producer’s state revenues. Iraq exported 3.583 million bpd from the southern ports on the Persian Gulf in August.

Iraq’s oil production will only grow marginally over the next 10 years despite its potential capacity, which stands at as much as 7 million bpd, an analyst from IHS Markit has recently forecast. According to Christopher Elsner, Iraq will only be able to boost production to 5 million bpd over the next decade, and by 2036 it would only grow to 6 million bpd, Arab News reports.