Iraq has warned Saudi Arabia and other OPEC members that it may consider all options, including leaving the oil cartel, if its production quota is not raised significantly. The warning comes amid a severe financial crisis in Baghdad, which Iraqi officials say was caused by the war with Iran, and the market has already reacted with lower oil prices.
According to sources familiar with Baghdad’s oil policy, cited by Reuters on Thursday, Iraq is seriously weighing its next steps after repeated refusals to increase its output quota. An Iraqi oil ministry official said the demand should be treated with “the utmost seriousness” and added, “If that does not happen, Iraq will have to consider all available options.” He said it was still too early to discuss a formal withdrawal, but confirmed that the idea has been raised.
Since taking office in May, Prime Minister Ali Al-Zaidi has made economic recovery, anti-corruption efforts, and foreign investment top priorities. He has said publicly that Iraq wants OPEC to align its quotas with the country’s actual production potential and population growth. Government spokesman Haider Al-Aboudi did not directly address the withdrawal reports, but said Iraq aims to fully restore its oil export capacity and lift output to 7 million barrels per day in the coming years.
The threat comes at a delicate moment for OPEC. The cartel has already suffered a blow this year with the departure of the United Arab Emirates, and a possible exit by Iraq, OPEC’s second-largest producer, could further weaken its stability and ability to influence global energy prices. Oil markets reacted with concern, with prices falling below $73 a barrel.
