Decrease in Iraqi Oil Exports to the US: A Comparative Analysis for 2023 and 2024

Decrease in Iraqi Oil Exports to the US: A Comparative Analysis for 2023 and 2024

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By: Shatha Kalel

Iraq’s oil exports to the United States have fluctuated over the decades due to various political and economic events. In the mid-20th century, Iraq nationalized its oil industry, leading to increased state control over oil production and exports. This period saw Iraq becoming a founding member of the Organization of the Petroleum Exporting Countries (OPEC) in 1960, which further influenced its oil export policies.

Iraq -US Oil Trade Dynamics
The Iran-Iraq War in the 1980s and subsequent Gulf War in 1991 significantly disrupted Iraq’s oil production and export capabilities. The United States’ military intervention in Iraq in 2003 and the subsequent toppling of Iraq system before 2003 regime had a profound impact on the country’s oil industry. The period following the invasion saw efforts to rebuild Iraq’s oil infrastructure, with US companies playing a significant role in this process.

Recent Trends
In recent years, Iraq’s oil exports to the United States have been subject to changes in global oil markets, shifts in US energy policies, and regional geopolitical developments. The advent of the shale oil boom in the US in the early 2010s reduced American reliance on foreign oil, including imports from Iraq. Additionally, political instability and security challenges within Iraq have periodically impacted its oil production and export levels.

As of the first third of 2024, Iraq’s oil exports to the US have decreased significantly, reflecting broader trends in the global oil market and specific challenges faced by Iraq. This decline underscores the dynamic nature of the global oil trade and the various factors that influence it, from market prices and production capacities to geopolitical tensions and policy changes.

Understanding the historical context of Iraqi oil exports to the United States provides valuable insights into the current state of affairs and helps anticipate future trends in this crucial aspect of global energy economics.
Decline in Iraqi oil exports to the United States during the first third of 2024. The daily export rate dropped to 170,000 barrels, a significant decrease from 250,000 barrels in the same period in 2023.

According to Al-Obaidi, Iraq exported a total of 20.5 million barrels valued at $1.6 billion in the first third of 2024, with an average price of $78.17 per barrel. This contrasts with the 29.35 million barrels worth $2.18 billion exported during the same period in 2023, which had an average price of $74.15 per barrel. This indicates a 30% reduction in the quantity of exports and a 26.3% decrease in value year-over-year.

Iraq now ranks as the eighth-largest oil exporter to the United States, accounting for 2.66% of the US’s total crude oil imports. This is a decline from the 3.9% share it held during the same period last year.

US Crude Oil Imports Overview
In the first third of 2024, the United States imported 771 million barrels of crude oil from various countries, averaging 6.4 million barrels per day and totaling $53.2 billion in value. This is a slight increase compared to the 750 million barrels imported in the first third of 2023, which averaged 6.3 million barrels per day and were valued at $51.3 billion.

Canada maintained its position as the leading exporter of crude oil to the United States. It exported 494 million barrels at a daily rate of 4.12 million barrels, valued at $31 billion in the first third of 2024. This marks an increase from the 459 million barrels, averaging 3.86 million barrels per day, and valued at $28.5 billion during the same period in 2023. Following Canada, the largest sources of crude oil for the US were Mexico, Saudi Arabia, Colombia, and Brazil.

Implications and Analysis
The decline in Iraqi oil exports to the US can be attributed to various factors, including geopolitical tensions, changes in global oil production dynamics, and shifts in US energy policies. The increased average price per barrel in 2024 reflects broader trends in the global oil market, including supply constraints and rising demand post-pandemic.

Canada’s increased exports underscore its growing importance as a stable and reliable oil supplier to the US. The data suggests a strategic shift in US crude oil import sources, favoring countries with more consistent and predictable supply chains.

Conclusion
The reduction in Iraqi oil exports to the US highlights significant changes in the global oil trade landscape. While Iraq’s share in the US oil import market has diminished, other countries like Canada have bolstered their positions. These trends are crucial for stakeholders in the energy sector to monitor, as they impact global oil prices, trade policies, and international relations.

Economic Studies Unit / North America Office
Rawabet Center for Research and Strategic Studies