Iraq is seriously mulling renegotiating contracts with partner oil companies in light of the current market situation with crumbling prices triggered by the coronavirus pandemic, Iraqi Oil Minister Thamir Ghadhban said on Monday
MOSCOW (Pakistan Point News / Sputnik - 30th March, 2020) Iraq is seriously mulling renegotiating contracts with partner oil companies in light of the current market situation with crumbling prices triggered by the coronavirus pandemic, Iraqi Oil Minister Thamir Ghadhban said on Monday.
"The situation cannot remain as it was before the coronavirus pandemic, before changes in the global economy and fall of oil prices ... There are several alternative options, including to begin a dialogue with companies," Ghadhban said in an interview with Iraq's Al-Mirbad broadcaster, adding that "this question is under serious consideration."
According to the minister, Iraq is currently selling its oil at an average cost of about $20 per barrel, whereas the price for European and Asian markets is slightly different because the pricing "takes into account a number of factors, including distance." At the same time, he said that the main problem on the market was not only the low prices of raw materials but also constant price fluctuations.
"They [companies] are our partners, and we want to observe their interests, just as we want to observe our interests. At the same time, they are aware of the situation in the global economy and the economy of Iraq," Ghadhban said.
On Friday, spokesman Assem Jihad told Sputnik that the Iraqi Oil Ministry would postpone requesting oil companies to cut budgets allotted to oil exploration by 30 percent, as it needed more time to evaluate the situation on the market.
Iraq is the second-largest oil producer among the OPEC member states.
