Friday PM Iraq Economy News Highlights 6-17-22
Friday PM Iraq Economy News Highlights 6-17-22
Iraq Bought More Than One Million Tons Of Gasoline During The First Quarter Of 2022
Shafaq News/ The "Iraq Future" Foundation, concerned with economic affairs, said on Friday that Iraq bought more than 1.1 million tons of gasoline during the period from 1-1-2022 to 31-3-2022, an increase of 34% compared to the same period in last year.
In a report published today, the Foundation said that the cost of one liter purchased from the Iraqi government during the first three months of the current year is 1,315 Iraqi dinars per liter, while the cost of one liter purchased during the past year was 930 Iraqi dinars per liter.
According to the Foundation, Iraq's loss from selling gasoline during the first three months of the current year amounted to 618 million dollars, while Iraq's loss from selling gasoline during all of 2021 amounted to 793 million dollars.
The report pointed out that with the continued rise in oil prices, and the increasing demand for gasoline, it is expected that Iraq's loss until the end of this year will reach 2.9 billion US dollars.
In turn, the head of the organization, Manar Al-Obaidi, stressed that it is necessary to work to accelerate the activation of the Karbala refinery, which will fill a large part of Iraq's need for improved and regular gasoline and will reduce the amount of total loss of gasoline. LINK
With The Closure Of The Stock Exchange .. The Dollar Is Declining In Baghdad
Shafaq News/ The exchange rates of the dollar decreased against the Iraqi dinar, today, Thursday, with the closure of the main stock exchange in Baghdad.
Shafak News Agency correspondent said that the Al-Kifah and Al-Harithiya Central Stock Exchange closed in Baghdad at 148,350 Iraqi dinars against the dollar.
While the prices this morning were 148,475 Iraqi dinars to the dollar.
Our correspondent indicated that the buying and selling prices in banking shops in the local markets in Baghdad decreased, as the selling price reached 148,750 Iraqi dinars, while the purchase prices amounted to 147,750 dinars per 100 US dollars. LINK
After falling for successive days, gold prices are rising again in the Iraqi markets
Shafaq News/ "foreign and Iraqi" gold prices in the local markets returned to rise today, Thursday (June 16, 2022) after several days of repeated decline.
Shafak News Agency correspondent said, that gold prices in the wholesale markets on Al-Nahr Street in the capital, Baghdad, recorded this morning, the selling price of one weight of 21 karat of Gulf, Turkish and European gold 377 thousand dinars, and the purchase price 373 thousand, while the selling prices for yesterday, Wednesday, were 374 thousand. Dinar.
Our correspondent indicated that the sale price of one 21-carat weight of Iraqi gold also increased at 337 thousand dinars, and the purchase price reached 333 thousand.
With regard to gold prices in goldsmiths’ shops, the selling price of a 21-carat Gulf gold weight ranged between 380 thousand and 390 thousand dinars, while the selling price ranged from an Iraqi gold weight between 340 thousand and 350 thousand dinars. It is equal to one mithqal of gold (five grams). LINK
Kurdistan Reveals The Details Of Its Oil File And The Mechanism Of The Agreement With Baghdad
Erbil (Kurdistan 24) - The Kurdistan Regional Government clarified today, Friday, the mechanism of agreement with the federal government regarding oil imports, confirming work to establish two oil companies, while it denied smuggling gasoline from the center and south to the provinces of the region.
And the Iraqi News Agency (INA) quoted the spokesman for the regional government, Jutiar Adel, as saying that “negotiations with Baghdad are continuing regarding the oil and budget files and the rest of the files,” noting that “the Kurdistan Regional Government agreed with the current Prime Minister Mustafa Al-Kazemi regarding these two files, which ended with the 2021 budget agreement. ".
He added that "many wonder about the Kurdistan government's failure to hand over oil imports to the center, as it was agreed, according to the budget law, to hand over 250,000 barrels of oil to SOMO after auditing the region's expenditures and imports, and it was agreed to hand over the center to the region of 320 billion dinars per month until the audit is done, except It was reduced to 200 billion dinars for no reason, noting that "the issue of negotiating with the federal government over the oil file has taken a lot from the life of the current government's cabin."
And he indicated that "the territorial government provided all the information to the Federal Financial Supervision Bureau (revenues, expenditures and property), but the federal government sent during the current year only three payments as (200) billion dinars per month."
He stressed, "the need for coordination between the two governments, as any break in the relationship will affect the two parties with many issues," explaining that "the Ministry of Natural Resources in Kurdistan works according to Iraqi law, and the lawsuits continue between Baghdad and Erbil regarding the oil file."
Adel pointed out that "the Kurdistan Regional Government is continuing to negotiate with the Center on the oil file, and the legal procedures in the court expect a settlement in its favour."
Adel stated that "the Kurdistan Regional Government has a contract with Turkey for a period of 50 years to transport oil only through the Turkish Ceyhan and not to sell it," explaining that "the Kurdistan Regional Government is now working to establish two oil companies: the first in the name of (Kroc) Company, which is specialized in oil exploration, and the ("Kurdistan") company. Como), which specializes in the export and marketing of oil.
He stated that "this is the last paper presented to Baghdad regarding the oil file."
Production and selling prices of the region's oil
Adel stated that "the region produces 400 to 420,000 barrels of oil per day, most of which is exported, and 25,000 barrels remain for local consumption," explaining that "this quantity is sent to the (Kar) refinery to produce about one million liters of gasoline and the rest of other derivatives."
And he indicated that "the price of a barrel of oil in the region is different from the price of a barrel of oil in the federal government because of" the cost of extracting oil in Kurdistan is 3 times greater than the cost of extracting it in the rest of Iraq because of the terrain and oil specifications.
He stressed that "there is an agreement with the company (Deliot), which is considered the first, which calculates the other expenses of the oil extraction process," explaining that "all numbers and reports regarding production and export operations are announced every three months to public opinion, and we plan to announce them monthly, which will include the number of extracted and exported barrels. and selling prices and costs.
OPEC Plus Agreement
The regional government spokesman added that "the regional government has committed to the OPEC Plus agreement in larger quantities than is required."
petrol smuggling
Adel answered the question of the reporter of the Iraqi News Agency (INA), about smuggling 7 million liters of gasoline per day from the governorates of central and southern Iraq to the region, that "there is no smuggling, and there is coordination between the two governments to stop smuggling and cooperate in all areas legally."
Gasoline prices in the region
And he added, "The Kurdistan Regional Government agreed with Baghdad to send 1.5 million liters of gasoline per day, but this quantity did not reach completely, and the transmission stopped since the first of May until now," explaining that "Baghdad sent this quantity only twice during that period, at a price of 650 Dinars per liter are paid in cash with the calculation of transportation fees of 20 dinars per liter, and 20 dinars for petrol stations, bringing the price of its sale to the citizen in the provinces of the region to 690 dinars. LINK
Kurdistan Regional Government Intends To Establish Two Oil Companies
Shafaq News/ The Kurdistan Regional Government announced, on Friday, that it intends to establish two public companies for oil and gas.
According to a report published by the regional government today, on its vision for managing the oil file, the two companies are the Kurdistan Regional Oil and Gas Company (KROC), which is specialized in the exploration, production and transportation of oil and gas, and the Kurdistan Oil Marketing Company (KOMO), which will be specialized in oil marketing.
And the report, which was reviewed by Shafak News Agency, stated, "It is possible to coordinate between these two companies on the one hand, and the National Oil Company, and the (SOMO) company in the relevant fields on the other hand, and that the coordination of the Federal Ministry of Oil with the natural resources of the Kurdistan Region."
To do all this, the report stipulated “the necessity of restructuring the company (SOMO), amending its bylaw, and making it a federal institution, in which decisions are taken jointly in order to achieve real participation of the Kurdistan Region in that company, and the representative of the regional government has the right of veto with regard to the Kurdistan Region issues. LINK
https://media.shafaq.com/media/arcella_files/1655461725584()%D9%86%D9%81%D8%B7 %D9%88 %D8%BA%D8%A7%D8%B2.pdf To view the full report,
Kroc” And “Como” .. A Kurdish Proposal To Establish Two Companies To Solve The Oil Problem With Baghdad
2022-06-17 Yes Iraq: Baghdad Today, Friday, the Kurdistan Regional Government revealed new proposals submitted to Baghdad to resolve the dispute over the region’s oil, while these proposals are summarized in the establishment of two companies in the region, namely “Krok”, which means exploration, and “KOMO” which is concerned with marketing, which mimics the Federal Marketing Company. Sumo.
The spokesman for the Kurdistan Regional Government, Jutiar Adel, said that "negotiations with Baghdad are continuing regarding the oil and budget files and the rest of the files," noting that "the Kurdistan Regional Government has agreed with the current Prime Minister Mustafa Al-Kazemi regarding these two files, which ended with the 2021 budget agreement."
He added that “many wonder about the Kurdistan government not handing over oil imports to the center, as it was agreed, according to the budget law, to hand over 250,000 barrels of oil to SOMO after auditing the region’s expenditures and imports, and it was agreed to hand over the center to the region 320 billion dinars per month until the audit is done, except It was reduced to 200 billion dinars for no reason, noting that “the issue of negotiating with the federal government over the oil file has taken a lot from the life of the current government’s cabin.”
And he indicated that "the territorial government provided all the information to the Federal Office of Financial Supervision (imports, expenditures and property), but the federal government sent during the current year only three payments as (200) billion dinars per month."
He stressed "the need for coordination between the two governments, as any interruption in the relationship will affect the two parties with many issues," explaining that "the Kurdistan Ministry of Natural Resources operates according to Iraqi law, and that lawsuits continue between Baghdad and Erbil regarding the oil file."
He pointed out that "the Kurdistan Regional Government continues to negotiate with the Center on the oil file, and that the legal procedures in the court expect a settlement in its favour."
Adel stated that “the Kurdistan Regional Government has a contract with Turkey for a period of 50 years to transport oil only through the Turkish Ceyhan and not to sell it,” explaining that “the Kurdistan Regional Government is now working to establish two oil companies: the first in the name of (Kroc) Company, which is specialized in oil exploration, and a company ( Como), which is specialized in the export and marketing of oil," noting that "this is the last paper presented to Baghdad regarding the oil file." LINK
Iraq Is Pushing For A “Compulsory” Marketing Maneuver In The West That Could Cost It $9 Million A Day In Oil Exports
2022-06-17 Yes Iraq: Baghdad It seems that Iraq began a maneuver "forced by Russia", by granting price cuts to Europe and America, after Russia acquired part of Iraq's market share in Asia, which imports nearly 70% of Iraq's oil exports.
Russia began offering price discounts to India and China, after Europe and America blockaded Russian oil and prevented its import, which led Russia to offer large price discounts to encourage India, China and Asian markets in general to import its oil, which led to eating part of the market shares of oil exporters in The Middle East, especially Saudi Arabia and Iraq, which control a large part of the Asian market in China and India.
The oil expert, Nabil Al-Marsoumi says, “One of the results of the Russian-Ukrainian war is that the world has become less integrated, and this has led to a change in the pattern of global trade and its geographical distribution, including oil trade, as the geographical direction of a large part of Russian oil exports has changed from west to east, and the policy of price discounts has succeeded.
Which Russia granted for its oil exported to Asia to acquire an important part in the Asian market, especially in India, as Russia did not export to India only 66,000 barrels per day before the war, but it doubled several times during the war to reach 819,000 barrels per day, which led to Russia becoming India's second supplier after Iraq, after it displaced Saudi Arabia from second to third place.
According to Al-Marsoumi, the Western sanctions imposed on Russia due to its invasion of Ukraine prompted many oil importers to stop trading with it, which pushed the prices of Russian crude in spot transactions to drop significantly compared to other raw materials, and this provided an opportunity for Indian refineries, which rarely used Russian oil due to Shipping costs rise, to snap up cheap raw deals.
India, which imports about 1.3 million barrels per day of Iraqi oil, or approximately 40% of Iraq's oil exports, has become a candidate to ignore part of Iraqi oil and go towards Russian oil, which poses a real threat to more than a third of Iraqi exports, and therefore it seems that Iraq is trying To obtain new market shares in the European and American markets after the Western embargo on Russian oil, and to compensate for any amount that Iraq might lose in the Indian market.
In this context, Al-Marsoumi revealed that the price of SOMO for Basra medium oil exported to Europe during the month of July came at a discount of $ 7.60 per barrel from Brent crude, and at a discount of $ 1.70 per barrel below the Ascii index for oil exported to America, while Saudi Arabia set the official selling price for Arab Light crude to Europe, an increase of $4.30 a barrel against Brent crude in July, and the United States, an increase of $5.65 against the Ascii index.
Thus, Iraq will lose for each barrel exported to Europe and America more than 9 dollars from the real market price, in price discounts that it was forced to offer to compensate for what it will lose in the Indian market, and if Iraq exports nearly one million barrels to both Europe and America alike, this will cost it about 9 million dollars a day will be lost as price discounts, as Iraq is currently exporting more than 500,000 barrels to Europe and more than 300,000 barrels to America, bringing the total to more than 800,000 barrels per day, and with the introduction of discounts and an attempt to compensate for the shortage in the European market due to the Russian oil ban, Iraq's oil exports to the West may rise to more than one million barrels per day.
Al-Marsoumi believes that “the great difference between the Iraqi and Saudi prices cannot be attributed solely to the difference in the chemical properties of the two oils, as the Arab Light oil has a density of 36-40 and a sulfur content of 1.78%, while the density of Basra crude averages 29 and a percentage of sulfur is 3%. Also, the change in the marketing policy of Iraqi oil.” LINK
Finance Minister: There Is No Share For The Kurdistan Region In The Next General Budget, Except After Its Agreement With The Ministry Of Oil
Finance Minister Ali Abdul Amir Allawi Money and business The Iraqi Minister of Finance, Ali Abdul-Amir Allawi, said that the Federal Supreme Court's decision to invalidate the oil and gas law in the Kurdistan region prevents the central government from allocating a portion of the upcoming general budget as a share for the Kurdistan Region .
In answering a question in this regard in an interview with the (Iraq Oil Report) website in Baghdad, Allawi stated that the previous budgets included paragraphs allocating 12% of expenditures to the Kurdistan Region, on the condition that Erbil sends the equivalent of oil revenues exported from the region’s fields, but in fact This agreement was not implemented, and was replaced by temporary agreements between Baghdad and Erbil, according to which Kurdistan received semi-regular monthly transfers worth 200 billion Iraqi dinars ($138 million), but these transfers will not continue .
Allawi said: My job is to implement the law, not to break the law. In the 2021 budget, there was a clear condition that the Kurdistan Regional Government must either hand over oil exports to SOMO or hand over the equivalent of money, which did not happen, so transfers to the Kurdistan Regional Government as dues from the general budget are no longer valid .
This time, if SOMO informs us that it did not have a legal basis, and that the Ministry of Oil did not find a legal structure to cover its ownership of that oil, then for us it basically means that this oil was seized and produced (illegally) and exported by the Kurdistan Regional Government (in a legal form). illegal) according to the interpretation of the Federal Court, which we consider at the federal level the highest legal authority .
He added, when we sent the money in the past, we were discussing this agreement on the basis that the oil belongs to the Kurdistan Regional Government and they have the right to extract it, whether we agreed or not with the oil contracts and the partnership contracts for extractive companies in Kurdistan, but this issue was not raised previously .
Now, the issue of ownership of the oil fields in the region has arisen, so if we transfer their entitlements to the budget - whatever their percentage - the other side of the equation will not be addressed at all, and in fact there is no other side to the equation, in the past there was an explicit recognition that this is oil The Kurdistan Regional Government, but now they do not have the right to act, and according to the decision of the Federal Court - although the Kurdistan Region will not accept this talk - now this oil belongs to us .