Iraq considers OPEC exit if production quota not raised

Iraq will consider all available options if its OPEC quota is ‌not significantly increased and has weighed leaving the producer group, sources with knowledge of Iraqi oil policy told Reuters.

The prospect of OPEC's second-largest producer considering an exit would be a further blow to the group after the departure this year of ​the United Arab Emirates. Iraq is one of the five founding members of OPEC, which ​was formed in the Iraqi capital.

Iraq is suffering a financial crisis as a result ⁠of the Iran war and a significant rise in its OPEC quota should be treated seriously, a ​senior Iraqi oil ministry official told Reuters.

Iraq had considered leaving OPEC, but the current plan was to remain ​a member and seek a higher quota, he added.

"Saudi Arabia and other OPEC allies should treat this matter with the utmost seriousness. Failing that, Iraq will be compelled to consider all available options," he said.

Asked if they had discussed ​an OPEC exit, he said: "It's still premature for this step".

OPEC did not immediately respond to a request ​for comment.

A government spokesperson said Iraq was working to restore full oil export capacity, but declined to comment further on ‌its ⁠OPEC quota or the possibility of exiting the group.

"Iraq is working to restore its full oil export capacity and aims to raise oil production to 7 million barrels per day over the coming years," Iraqi spokesperson Haider al Aboudi said.

Iraq's economy, heavily dependent on oil revenue, has been squeezed since the Iran ​war disruptions to the Strait ​of Hormuz locked the ⁠bulk of its exports in.

Oil prices briefly extended their decline after the Reuters report, trading below $73 a barrel.

Since taking office in May, Iraqi Prime Minister Ali ​al-Zaidi has signalled that rebuilding Iraq's economy, attracting foreign investment and combating ​corruption will be ⁠central to his administration's agenda.

On Wednesday, he said Iraq wanted OPEC to raise Iraqi oil output in line with its production capacity and population, state news agency INA reported.

Seven core members of OPEC+ have increased their ⁠output ​quotas from April to June by almost 600,000 barrels per day. ​OPEC+ comprises the Organization of the Petroleum Exporting Countries and allied producers, including Russia.

-Reuters