Iraq is considering leaving OPEC if its oil production quota is not increased, citing a critical financial crisis. The country proposes boosting exports to compensate for losses, with any decision potentially following Prime Minister Ali al-Zaidi's visit to Washington.
Iraq's potential exit from OPEC could significantly disrupt global oil supply and pricing, given its position as a major producer and the cartel's efforts to manage output. The country's financial crisis underscores the geopolitical risks tied to oil-dependent economies.
Iraq, OPEC's second-largest producer, is contemplating leaving the organization if its demand for a higher oil production quota is not met. Sources within the Iraqi government indicated that Baghdad is considering all options, including an exit, to compensate for production and sales losses incurred since the start of regional conflicts. The country's economy is heavily dependent on oil, accounting for 90% of its state budget revenues, and has been severely impacted by disruptions such as the de facto closure of the Strait of Hormuz.
In parallel, seven OPEC+ members, including Saudi Arabia, Russia, and Iraq, have agreed to a collective increase in their oil production quota by 188,000 barrels per day. This decision follows the recent withdrawal of the United Arab Emirates from the group. Analysts suggest this move signals OPEC+'s continued market influence rather than a significant supply boost, especially as actual production often falls short of existing limits.
Any definitive decision by Iraq regarding increased production or withdrawal from OPEC is expected to be made after Prime Minister Ali al-Zaidi's planned visit to Washington next month.