Iraq is in talks with other crude producers to limit declines in oil prices

Dubai — Iraq is talking with other crude producers about ways to keep oil prices from falling even more, the country's oil minister said on Tuesday, as OPEC's second largest producer followed in the footsteps of Saudi Arabia and slashed April selling prices to multi-year lows.

Talks are being held with members within and outside OPEC, while at same time maximizing revenue, Thamer al-Ghadhban said in a statement on the ministry's website. He didn't specify what steps may be taken to halt the price declines.

Iraq chose "the most accurate” criteria to price its oil, depending on quality, Alaa al-Yassiri, the head of oil marketer SOMO, said in the statement.

SOMO on Tuesday reduced its April oil prices by as much as $5/b for some crude grades after Saudi Arabia slashed its prices over the weekend, with some grades now priced at record lows in what analysts are calling a potential price war with Russia.

Saudi Arabia, which failed to convince Russia to agree on extending and deepening oil production cuts beyond March, set a precedent for other producers in the Middle East by slash its prices for April deliveries. State-run Saudi Aramco also said it will be delivering customers 12.3 million b/d in April, well above its recent output of about 10 million b/d.

Abu Dhabi National Oil Co, the UAE's biggest producer pumping some 3 million b/d, cut outright official selling prices for all of its four grades by $11.70/b month-on-month in a notice issued late Monday.

SPECIAL STATUS

Iraq has a "special status" in global oil markets and will continue to bolster that status while adhering to its commitments to the companies with whom it has contracts, Yassiri said, without elaborating.

Iraq is seeking oil market stability because pumping more crude will not be wise given the supply glut that has been exacerbated by Saudi Arabia's slashing its selling price for April, the spokesperson for the oil ministry Assem Jihad said on Monday. The Iraqi delegation at last week's OPEC+ meeting tried its best to resolve the dispute, Jihad said.

"The oil price crash will hit all producing countries, including Iraq, and it will also hit the global economy that will suffer from a dearth of investments. All countries should specify their production levels to soak up the supply glut in global markets and reinstate the balance between supply and demand, which will lead to higher oil prices,” he said.

Iraq's oil production rose 3% in February to 4.5 million b/d, above its OPEC+ quota of 4.46 million b/d, according to figures from SOMO released on Monday.

Exports also increased 4.8% to 3.879 million b/d from 3.7 million b/d in January, SOMO said.

The country, which exceeded its quota for most of last year, has been unable to stick to production limits this year as well.

Iraqi output rose to a four-month high of 4.65 million b/d in February, with exports up at its southern terminals and also from the semi-autonomous Kurdish region, according to S&P Global Platts latest OPEC survey.

(Updates with oil minister comments)