Middle East

Expect stockpiling, Poten warns on Iraq chaos

New York: New York tanker broker has highlighted the grave disruptions hitting Iraq’s oil supply chains as the country descends into severe political chaos.

Iraq has been supplying increasing quantities of crude oil to China, as volumes have been lightly backed out of the United States, Poten noted. In general, Iraq’s southern crude oil exports out of the port of Basra are far greater than those from its northern outlet of Ceyhan, Turkey, via the CPC pipeline. Basra, located on the Arabian Gulf, is a critical demand source for VLCC trade.

Since April 2014, exports of Kirkuk crude oil from Ceyhan have ceased entirely, the broker said.

“Until a course of action is determined, it appears conditions in Iraq will worsen before they get better. To that end, compromised export volumes and higher oil prices are likely. Expect stock piling in major consumer countries as a result,” Poten warned. [15/06/14]

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