Iraq may invest in overseas oil refineries
Iraq is exploring investments in high-capacity overseas oil refineries to secure steady crude sales and maximise revenues, with a particular focus on fast-growing Asian markets, a senior oil official has said.
Nizar Al-Shatri, Director General of the State Oil Marketing Organization (SOMO), said, "Nearly 75 percent of Iraq's oil exports are directed to Asia, citing the region's accelerating demand and expanding refining capacities, especially when compared to European and North American markets."
China, India, South Korea, Indonesia, and Malaysia remain Iraq's top crude buyers, he said, quoted by the Saudi Asharq news agency on Sunday.
Al-Shatri explained that investing in foreign refineries would allow Iraq to secure fixed refining quotas, shielding exports from market volatility.
'We aim to work with reputable clients who operate high-capacity refineries in various markets to absorb price fluctuations without affecting export volumes,' he said.
SOMO is currently pursuing long-term partnerships with major refiners across Asia, Europe, the Americas, and several African markets, he noted.
These deals typically allow Iraq to sell crude at official prices, while benefiting from price differentials during market surges—taking 65 percent of the profit, with partners retaining 35 percent. In case of losses, the foreign partner bears the cost.
Al-Shatri reaffirmed Iraq's commitment to OPEC+ quotas, stating that the country respects its production ceiling—currently set near 4 million barrels per day (bpd), though Iraq's full production capacity is closer to 5.5 million bpd.
He revealed that in 2024, Iraq exported approximately 1.2 billion barrels of oil, generating $97 billion, nearly 90 per cent of the country's total budget revenues.
(Writing by Nadim Kawach; Editing by Anoop Menon)
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