SULAIMANI (ESTA) — The financial adviser to Iraq’s prime minister said on Monday a war price could begin if OPEC producers failed to reach understandings on oil production.
Ministers of OPEC and its allies, a group known as OPEC+, called off output talks on Monday, after clashing last week when the United Arab Emirates (UAE) rejected a proposed eight-month extension to production curbs, meaning no deal to boost output has been agreed.
“In the absence of coordination and understandings between OPEC producers, the beginnings of a price war will be formed again,” Iraqi PM’s financial adviser Mazhar Mohammed Salih said, according to state news agency (INA).
“The increase in production within the OPEC member countries must be carried out with caution and in high coordination among the member countries themselves to avoid any potential glut in the crude oil supply market that may cause undesirable price imbalances,” he added.
The failure of the talks, which had partly been about an increase in oil output from next month, helped to drive up international benchmark Brent crude, which was trading 1.1% higher at above $77 a barrel.
Oil prices are at the highest since 2018 and have already prompted concerns inflation could derail a global recovery from the pandemic.
Iraqi Oil Minister Ihsan Abdul Jabbar said on Monday that his country was committed to the current agreement with OPEC and its allies and did not want to see oil prices soaring above current levels to achieve stability.
He hoped that in 10 days there could be a date for the next meeting.
OPEC+ agreed record output cuts of almost 10 million barrels per day (bpd) last year, about 10% of world output, as the pandemic hit. The curbs have been gradually relaxed and stand at about 5.8 million bpd.
