Iraq’s fuel oil exports set to hit record highs in ’24

Iraq’s fuel oil exports are set to hit record highs in 2024, driven by increased shipments in October and rising domestic production. According to industry sources and ship-tracking data, exports are on track to exceed 18 million metric tons (380,000 bpd), surpassing last year’s record of 14 million tons.

The surge in fuel oil exports, mainly high-sulphur and straight-run, has been facilitated by a seasonal dip in domestic demand, falling by around 100,000 bpd. This, combined with favourable refining margins, has made boosting exports economically advantageous. In October, Iraq exported over 2.15 million metric tons, the highest monthly volume on record.

Iraq’s refineries, particularly the Karbala refinery with a capacity of 140,000 bpd, have played a key role in increasing production. However, future export levels will depend on whether Karbala’s secondary units operate at full capacity. Despite stagnant crude exports due to OPEC+ quotas, Iraq’s shift towards processed oil products like fuel oil has helped bolster oil revenues.

Exports are expected to remain strong through November, although they may taper off later in the year as Iraq begins stockpiling for winter heating demand.

Attribution: Reuters

Subediting: M. S. Salama