BAML: Iraq poses risk to oil outlook

Iraq poses a risk to oil market outlook as the country may not fulfil output expectations in the shorter term, says Bank of America Merrill Lynch (BAML). However, the prospect of a huge increase in oil production may still maybe able to keep prices under $100 per barrel (/bbl) in 2010, says the bank

BAML says while Iraq has the potential to vastly expand productive capacity, the Iraqi government's stated intention to increase oil capacity from 2.5 to 10-12 million barrels per day (b/d) over the next decade is "very optimistic and we remain sceptical that such increases can be achieved".

However, BAML says, ‘still, a four-fold increase in Iraqi production could be sufficient to keep oil prices from rising above $100 per barrel (/bbl) for much of this decade.'

The US Energy Information