| War in Iraq has lifted the oil price a little. Its long-term impact will be bigger. Before Islamist fighters seized much of northern Iraq, hopes that the recent era of stable oil prices would last rested heavily on the country. Its exports were expected to go on rising, providing lots of low-cost oil at a time when the depletion of mature fields elsewhere is beginning to bite into supplies.
The International Energy Agency has projected that Iraq’s production will jump from 2.5m barrels a day (b/d) now to 4.4m in 2015 and nearly 6m by 2020. Other forecasts have been even rosier. But as on so many occasions since 1980, war, sanctions and domestic upheaval have constrained the huge potential of OPEC’s second-biggest producer. The chances of restarting exports from northern Iraq (via a pipeline crippled by sabotage in March), and of investment and modernisation in the country’s south, are looking slimmer by the day...............................................Full Article: Source
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