FX.co ★ Iraq increases production and oil exports this early February

Crude oil exports from Iraq increased in early February, despite the ongoing agreement with OPEC in which members have promised to cut production.

In fact, Baghdad has publicly pledged to lower its quota for February, in order to offset its previous overproduction. Now, if production continues to be at the same rate, Iraq may exceed its 3.6 million bpd quota, as well as OPEC's limit of about 3.85 million bpd.

Of course, exports are not a direct measure of production. However, it indicates the amount of oil supply the country has.

Aside from that, oil reserves can be sold, and it does not count towards OPEC's quotas.

The tanker tracking data compiled by Bloomberg is also preliminary, so the average daily values can change during the month.

For example, in the first half of February, crude oil exports from Arab countries have risen to 3.44 million bpd, which is 4.4% more than in January, and is the highest in all months since May, when OPEC began to cut supplies.

If Iraq maintains its current pace of exports and consumes the same amount of oil on the domestic market as in January, it will be able to pump nearly 4 million bpd this February.

Last year, the dire economic situation in Iraq, plus its inability to control production, has led to an overproduction of about 80,000 bpd.

It was OPEC's production cuts that helped regulate oil prices. Now, the cold weather in parts of Asia and the US helps as well.