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Why Iraq Oil Production Must Stay High

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    Barclays director of commodities research Helima Croft on Iraq and the oil market.

  • Duration 3:16
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Wow so Iran and oil and the importance of Iraq and keeping supplies of crude plentiful -- -- crop can explain it all.

She is commodities research director at Barclays -- -- Iran into because Iran is trying to is still has power we see despite.

If sanctions are declining oil production and how important a rock has been to making up that lost.

Actually early in its interest in the you have the cyber -- -- Iran because they're -- linked kilometer sniper attack on the Saudi aramco computers.

In August and attack on the -- -- computers -- -- so there Ron are showing a willingness to sort of respond to sanctions efforts because I have really curbed Iran and oil production and they are running well -- spreads.

Have declined by around 40%.

And one of the way that the market is -- -- -- philosopher Ronnie in exports has been through increased Iraqi production.

But were concerned that Iraqi production is quite vulnerable on the back in Iraq and now the second largest producer in OPEC.

Make us a little bit nervous about the stability of oil supplies would happen.

As -- with sanctions against Iran in the coming year will we see declining production continue.

We see production -- even more in Iran and then.

What are the major concerns that you have about Iraq being able to maintain its very big position and -- while.

I mean we we seen some of the countries -- in.

Declining in terms of the what they'll take over on in production trying to get back into the market to -- sanctions have started to leak.

And the new sanctions drive -- to tighten that up to make it more difficult for countries for example.

To pay Iran for crude and gold -- it's trying to basically.

Restrict Iran in exports to we think that the sanctions are successful we could see moron in production off the market this year.

And that puts the pressure on countries like Iraq or production -- increased by 12% last year here on here but -- seen recently Kurdistan exports.

Off the market again because the ongoing dispute between Baghdad.

And the semi autonomous government in Kurdistan.

Were also concerned that we see this uptick in violence in Iraq since this summer al-Qaeda -- down a bit of a terror in Iraq.

And we had a spillover really from Syria so we look -- Iraq and we say it had tremendous -- -- the production and but the political and security environment there remains very challenging -- Are there any other countries and Saudi Arabia.

Even the United States with its increasing production here.

They can make up any loss that we might see in Iraq like is there any cushion anywhere else in the world William and you look at you know where we can see potentially with an O pack in the saudis -- -- they really have spare capacity.

And it becomes a very interesting question of what the saudis will do in terms that if we did -- -- this coming out of Iraq.

Right now we've seen you know the Iraqi exports were down 10% in December.

But we have not CN meter -- kind of facility -- now I think everyone is sort of and wait and see not another country want I want so is Libya because.

Libyan production has been another country that has allowed to absorb the loss of -- in exports he do you want to watch do we see any potential -- in Libya and the benefits under the securities situation.

Did not remain very stable -- big question mark thank you only days do you.

Having me happy new year -- lot -- clearly they go Barkley I was.

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