Oil price falls as Iraq vows to open taps

Iraq threw an obstacle in Opec’s path toward a final deal to stabilise oil markets when it balked at joining efforts to trim output to prop up crude prices.

The group’s second-largest producer should be exempted from cutting its production because it’s embroiled in a war with Islamic militants, oil minister Jabber Al-Luaibi has said.

Iraq currently produces more than the 4.7 million barrels a day it pumped in September, and output could rise still higher as the government urges international companies to boost production at its fields, he said.

The minister disputed Organisation of Petroleum Exporting Countries figures that peg Iraqi output at less than 4.2m barrels daily.

Opec is trying to woo other producers to join in the group’s first output cuts in eight years, a policy shift that members agreed to in Algiers.

Crude plunged to a 12-year low in January, hammering the budgets of producers from Venezuela to Saudi Arabia.

At one stage yesterday, Brent crude fell as much as 53 cents, or 1%, to $51.25 a barrel in London trade.

The price slide led Opec to abandon its two-year-old Saudi-led policy of allowing members to pump as much as they could in an effort to protect market share.

Russia, the biggest prize in Opec’s quest for support, refused again to commit to joining the plan.

Russia is producing about 10.9m barrels a day on average this year.

Opec pumped a record 33.75m barrels a day in September, with Saudi Arabia accounting for 10.58m barrels of the total.