.Iraq oil output to reach 4.4 mbpd in 2015-Merrill

Fri Jan 14, 2011 1:10pm GMT
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* Forecast revised up from 3.8 mln barrels a day last year * Revision follows higher govt proven reserve estimates * Strong growth in oil demand likely to offset output rise
LONDON, Jan 14 (Reuters) - Iraqi oil production could rise
to 4.4 million barrels per day (bpd) by 2015, according to a
report by Bank of America Merrill Lynch on Friday. The revision from 3.8 million bpd forecast a year earlier
had been prompted by "higher reserve estimates" released by the
government, the bank's commodities research team said in a note. The Iraqi government raised its proven oil reserves figure
by a quarter in October to 143 billion barrels [ID:nLDE69100U],
placing it third in BP's (BP.L: Quote) list of global reserves holders. The research group added that strong emerging market demand
growth coupled with falling non-OPEC output would at least
partly offset 1.9 million bpd increase in Iraqi output in the
run-up to 2015. It reiterated that "crude oil prices will have to rise over
the coming years." Iraqi production rose to 2.6 million bpd in December
[ID:LDE6BQ0AA] for the first time in 20 years, but remained
below the 3 million bpd it produced in the late 1980s, prior to
its invasion of Kuwait. The bank said it remained "sceptical" that government plans
to boost output exponentially by 2020 could be achieved, noting
that security problems and infrastructure issues were likely to
continue to limit production. The Iraqi government expects output to rise to 12 million
bpd over the next six or seven years according to an
announcement by Iraq's new Oil Minister Abdul Kareem Luaibi in
December. ([ID:nLDE6BQ0AA]. The bank's research group broadly forecast commodity prices
to move higher in 2011 on strong emerging market growth, and oil
balances to remain tight in 2011. Iraqi economy could double every six years if production
reached 6.7 million bpd in 2025, absorbing "some" of the
increased output, the group said, adding Iraq might inevitably
rejoining OPEC's quota system once flows reached 4 million bpd.
(Reporting by Jessica Donati; editing by James Jukwey)