Tuesday Evening Iraq Economic News Highlights 7-12-22
Tuesday Evening Iraq Economic News Highlights 7-12-22
Economic Report: Iraq Is Not The "Savior" Of The Global Oil Crisis
2022-07-12 Shafaq News/ The South Korean Econo Times newspaper ruled out, on Tuesday, that Iraq would have the ability to secure an alternative to the global oil demand market, in light of the shortage it suffers from, pointing to a series of challenges facing Iraq, especially corruption that is being dealt with. On the grounds that it is a "rules of the game" that exists and not just a pest.
And after the economic report translated by Shafak News indicated that French President Emmanuel Macron said during the last seven countries summit in Germany that Saudi Arabia and the UAE, two of the largest exporters in OPEC, may not be able to increase their oil production in the next six months in order to Dealing with the increase in global demand for oil, but he considered that this talk raises the question: If Saudi Arabia and the UAE are not able to pump more barrels of oil, who will do that?
Corona Epidemic And The Ukrainian Crisis
The report pointed out that the global oil markets had been struggling for months under the influence of the recession caused by the Corona epidemic and the start of the global recovery, but the Ukrainian crisis caused chaos in global markets, as the rapid rise in demand led to a decline in the contraction of supplies and then the rise in prices around the world.
The report pointed out that world leaders are trying to persuade the exporting countries to increase extraction from their oil reserves and thus raise production, and great hopes were placed on Saudi Arabia, which US President Joe Biden is visiting after two days, despite his pledge to isolate it because of its human rights practices.
While referring to Macron's comments confirmed by the UAE, showing that neither Saudi Arabia nor the UAE have the spare capacity to pump additional barrels, he continued that some analysts considered that the entire OPEC system had "collapsed", and therefore there was a need to look towards other countries that have oil reserves. untapped.
And he indicated that, in the past weeks, Washington began exploratory talks with Venezuela and Iran, and they are likely to demand, in return, the easing of economic sanctions imposed on them, in exchange for increasing their production.
Pipe Dreams
In this context, the report specifically referred to Iraq, explaining that it has a great ability to extract and export oil, as it produces about 4.5 million barrels per day, and according to the Iraqi Minister of Oil, it is likely to raise its production to 6 million barrels per day by the year 2027, then to 8 million barrels.
After the report pointed out that the increase in Iraqi production would be a "great blessing" on global oil supplies, the report added, however, that "corruption, political paralysis and insecurity make Iraq an unreliable partner to secure additional barrels of oil."
The report spoke of the "imbalance of Iraqi politics" that allowed for a concentration of the country's wealth in the hands of a minority of politicians and bureaucrats, and corruption within the system cost billions of dollars and created "a weak state that is unable to control its natural resources."
He noted that "Iranian-backed militias regularly attack oil and gas infrastructure, while unclear legislation leaves the federal government and the Kurdistan Regional Government wrangling over rights to control the oil fields."
In addition, international companies are wary of doing business inside Iraq due to the unpredictable business climate and high levels of corruption where bribery is prevalent, adding that for those companies that have managed to gain a foothold, they are not insured against illegal interference from the state by its actions.
The “Incompetence” Of The Judiciary
The report dealt with the absence or inability of local judicial authorities to guarantee the rights of companies, referring in this context to the case of Petrofac, which was tried in Britain last year and ordered to pay a fine of 70 million pounds due to illegal payments made to obtain contracts in countries in the Middle East. , including Iraq.
The report also mentioned the case of the Kuwaiti "Agility" company, which filed a lawsuit abroad against Iraq for its arbitrary confiscation of $380 million of its investments in the "Kork" Communications Company in the Kurdistan Region.
The report considered that such cases and cases related to corruption and judgments show that corruption in Iraq is one of "the rules of the game, and not a scourge that must be addressed," recalling that "Agility", in the wake of the judicial ruling that was not in its favour, issued a statement in which it said that foreign investors should Those who wish to invest in Iraq, "must think carefully about the risks of investment."
Local Challenges
The report concluded by saying that all this does not present an appropriate picture for foreign oil companies to invest in and partner with the Iraqi energy sector, with the aim of trying to overcome the stagnation in global oil production, despite the report indicating that Iraq enjoys a unique position that enables it to benefit from the situation and increase its production.
The report concluded by saying, "The familiar domestic challenges mean that Iraq is not likely to be the solution to the global oil shortage," adding that "Iraqi corruption, from ordinary citizens who have to pay bribes, to international investors who have been deceived by hundreds of millions Of dollars, it is a disaster for everyone, except for the Iraqi officials." "It seems that they want to keep it that way," he concluded. LINK
The Russian Advance Is “Expanding” In The Asian Market At The Expense Of Iraqi Oil.. Baghdad Loses 137 Thousand Barrels Per Day In The Indian Market
2022-07-12 Yes Iraq: Baghdad The Russian advance and its acquisition of the Middle East's shares of oil in the Indian market began to become clearer, and the first blow to Iraqi oil was dealt with, whose exports to India declined by more than 10%, in contrast to the growth of Russian oil, which is close to displacing Iraqi oil from the forefront.
India's oil imports from Russia jumped to a record level of about 950,000 barrels per day last June, which represents about one-fifth of the imports of the third largest oil consumer in the world, according to data provided by Indian trade.
Indian refiners were buying Russian oil sold at deep discounts on Brent and Middle East crude after some companies and Western countries avoided buying from Moscow after it invaded Ukraine on February 24.
The data showed that India shipped about 4.8 million barrels per day of oil in June, and the data showed that oil imports from Russia increased by 15.5% in June compared to May, while Iraq and Saudi Arabia’s imports fell by 10.5% and 13.5%, respectively, bringing the Middle East’s share to 56.5 % of 59.3%.
Russia remained India's second largest oil supplier after Iraq, while Saudi Arabia remained third for the second month in a row.
While Iraq exports 1.3 million barrels per day to India, the 10.5% decline in its exports to India means that Iraq has lost about 137 thousand barrels per day from its exports to India, at a time when Russia is approaching and may completely remove Iraq from the forefront of the Indian market.
Cheaper Russian oil reduces losses to India's state-run refineries that sell fuel at low prices in the domestic market, while adding to the profits of private companies Reliance Industries Limited (RELI.NS) and Nayara Energy, which export most of their refined products.
India, the world's third-largest oil importer, has defended its purchases of "cheap" Russian oil, saying it provides only a fraction of the country's overall needs, and a sudden stop will increase costs for consumers.
The rise in oil imports from Russia reduced the share of OPEC in India's total imports to 65.2% during the quarter and 60.8% in June, and the data showed that the share of OPEC in India's oil imports has been declining since last March. LINK
The fate of Iraq's smuggled money is linked to the pressure of rice.. the password of the Americans
Article at link https://baghdadtoday.news/ar/news/195063/A
Water Negotiations With Neighboring Countries..Protecting Food Security
Thursday 07 July 2022 105 Baghdad: Imad of the emirate Vahid al-Rabi'I The country is exposed to the water scarcity of the Tigris and Euphrates rivers and the tributaries that flow into them, and the situation cannot be tolerated or ignored with its catastrophic results. For years, Iraq has sought, and for years, with continuous diplomatic efforts with the two neighbors Turkey and Iran to ensure the flow of water from its sources and to address the water scarcity.
On this issue, the specialist said. On the economic issue, Dr. Abdel Latif Shehab: “Good positive results have been crystallized from these diplomatic efforts with Turkey, but they are not up to the level of ambition in obtaining water resources for the country.”
Shehab added to "Al-Sabah", that "the Minister of Water Resources stated that the stumbling and complexity is with Iran, which cut off all water sources that flowed into the Diyala River and cut off the Karun River, which was a source of Basra's water; Therefore, it has become a national duty to use all methods to restore the country's water rights to protect food security, and for negotiations to be based on the principle of sharing harm or invoking international treaties on the course of water.”
Downstream Country
Shehab continued: “The issue of water is one of the most important pillars of national security for any country in the world, as the countries in whose territory the sources of the water source are located enjoy high flexibility in controlling the amount of water that reaches the downstream country, and as is the case between Iraq, Turkey and Iran, where The water problem has emerged for many decades, and called for the need for provisions and rules governing the use of water between the three countries.
He continued: "The Treaty of Lausanne in 1923 addressed this, as Article 109 stipulated the necessity of forming a joint committee between these countries whose mission is to address issues related to the waters of the Tigris and Euphrates rivers."
Shehab stated: "A preliminary agreement between Iraq, Turkey and Iran referred to a settlement of any dispute over the water distribution system, and based on these international constants, water negotiations with upstream countries must focus on obtaining Iraq's water rights."
Water Ration
On the distribution of water shares according to international agreements, Dr. Nagham Hussein, Dean of the College of Business Administration at Al-Nahrain University said: There are constants and texts for treaties of friendship and common understanding between Iraq and Turkey that can be a basis for launching water negotiations, given that the major water share comes from Turkey, not Iran.
Hussein explained to “Al-Sabah” that “Article 5 of Protocol Number One on regulating the waters of the Tigris and Euphrates from the Treaty of Friendship and Good Neighborliness between Iraq and Turkey signed in 1946 focused on that Iraq has the right to send bodies to conduct surveys and that Turkey undertakes to cooperate with these international bodies and facilitate Their task is to do their work, and also to do the maintenance work for the permanent stations of water meters and dispose of it.”
She stressed: "However, the Turkish side was not cooperative and kept delaying and refraining from committing to implementing its provisions, and what we want to say is that Iraq's negotiations with Turkey and Iran must focus on the country's national constants to protect the country's water rights, and then protect the food security of the citizen."
Diplomatic Solutions
In order to address the current situation of water scarcity, academic Dr. Abdel Karim Al-Issawi explained that “it is wise to deal with diplomacy in securing water supplies from the two neighbors, Turkey and Iran, and that the following facts highlight the first, the importance of influential international legal bodies in determining the owners of the right to obtain water under various Circumstances, and the second, when the water shortage becomes severe, the voices of the needy rise from it for a just settlement of their cause.”
He explained, "Based on these facts, Iraq does not want to find itself in military conflicts again with neighboring countries, and it is better to resort to the legal institutions of the United Nations and regional institutions."
Al-Issawi continued: “In this regard, the Vienna Convention refers, which came to regulate the uses of international rivers, and defined it as a navigable river that separates or penetrates several countries. That a watercourse state does not cause harm to a state or other watercourse states in the event that it carries out activities that are harmful to states the other.” LINK
Iraq “Internationalizes” The Water File
Thursday 07 July 2022 Iraq Baghdad: Omar Abdul Latif The concerned authorities in the country have threatened to “internationalize” the water issue during the next stage, after the great suffering of some provinces due to the scarcity of even drinking water, and the Turkish and Iranian sides’ failure to respond to the demands to increase Iraq’s water quotas, while the Ministry of Water Resources announced the drilling of wells in the marsh areas to keep residents That area in their places.
The head of the Agriculture, Water and Marshlands Committee in the House of Representatives, Thaer Mikheib Al Kitab, said in an interview with Al-Sabah: "With the beginning of the legislative term, the committee will seek to direct the Ministry of Foreign Affairs to address the countries of Iran and Turkey in order to increase Iraq's water share from them."
He added that "Turkey is in the process of constructing the irrigation dam, which is 35 km from Iraqi territory, and it is a dangerous and terrifying dam that violates all legal norms among the riparian countries for Iraq and will cast a shadow over future generations."
He added, "Turkey disregarded all the values, standards, laws and constitutions written between it and Iraq, especially when the water was cut off despite the entry of the Iraqi marshes as water bodies to the World Heritage List, which must always be submerged in water according to the regulations of the United Nations Organization for Culture, Science and Arts (UNESCO). ".
The head of the Parliamentary Committee confirmed, "writing protest notes to the Turkish embassy in Iraq and then to the United Nations and internationalizing the issue of cutting off water from Iraq, and holding official and popular conferences in this regard."
He cautioned that "reducing Iraq's water share from Turkey is nothing but a plan drawn up and prepared in a (malicious) manner, and it completely suffocates Iraq, and implements a scheme aimed at starving Iraq and making it a permanently consuming country."
Al-Kitab explained that "Iraq will follow diplomatic steps to resolve this issue with Iran and Turkey, and then move towards escalation to reach the level of cutting off trade exchange with those countries."
For his part, Head of the Planning Department at the Marsh Revitalization Center at the Ministry of Water Resources, Dr. Haider Lafta Ali, said: "The quantities of water that reach the marsh areas have been greatly affected by the scarcity."
Ali added in an interview with "Al-Sabah", that "the lack of submerged areas affected the residents there, so they are trying to change their places," noting that "the center works by developing plans to install the citizens who are there by digging wells, installing desalination plants, and delivering water to The farthest point is found in the villages and countryside of the marshes.
He explained that "the Ministry of Water Resources has implemented many projects in the marshlands, and they exist in the form of integrated plans that lack some funding, but they are ongoing," noting that "the existence of alternatives using the waters of the general estuary contributed to the revitalization of part of the western Hammar Marsh."
He pointed out that "after the marshes entered the World Heritage List, a national committee was formed under the chairmanship of the ministries of resources, environment, agriculture and culture and the rest of the ministries to follow up on the file, and there are plans prepared and submitted to the General Secretariat of the Council of Ministers, and sums were allocated for it in 2018, estimated at 60 billion dinars, but unfortunately, it was not implemented." financing it.”
Editing: Muhammad Al-Ansari LINK