Iraq parliament approves Basra Oil Company head as new oil minister

Amman, Jordan — Iraqi lawmakers on June 6 confirmed the appointment of Ihsan Ismaael as the country's new oil minister, according to local media.

Ismaael -- who was the director general of Basra Oil Company (BOC) -- takes over for Ali Allawi, the finance minister, who had been serving as interim oil minister and has been elevated to deputy prime minister for economics and energy, overseeing the oil ministry.

BOC operates in Iraq's south and is the country's largest state-run oil company.

Ismaael now has the challenging task of boosting Iraq's production and export capacity after years of underinvestment and infrastructure damage due to war, as well as negotiating contracts with international oil companies, many of whom have been dissatisfied with the fiscal terms offered for upstream partnerships.

The federal government in Baghdad is also at loggerheads with the semi-autonomous Kurdistan Regional Government over oil revenue sharing.

As well, Iraq's relationship with its OPEC peers has been strained, with the country's habitual noncompliance with its production quota causing tensions with Saudi Arabia and other members who feel their efforts to cut output to prop up the oil market are being undermined.

OPEC and its allies are meeting June 6 to deliberate an extension of their historic production cut agreement.

In a statement June 5, oil ministry spokesman Assem Jihad said that Iraq understood the importance of complying with the deal.

"Despite the economic and financial conditions facing Iraq, it is sticking to adherence to the agreement, because it believes in the necessity of solidarity of all producers ... to save the oil market," Jihad said.

Ismaael was among seven new ministers approved by parliament to fill vacancies in the cabinet of Prime Minister Mistafa al-Kadhimi, who took office in May, ending a long political stalemate after previous PM Adel Abdul Mahdi stepped down in November amid massive protests over corruption, Iranian interference in Iraqi affairs and lack of economic development.