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U.S. study: Iraq's failure to implement plans to increase oil production will contribute to the global energy crisis

Sara Johnson

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U.S. study:Iraq's failure to implement plans to increase oil production will contribute tothe global energy crisis

22/11/2011 14:56

Arbil, November 22 (Rn) - A study by the Harvard Kennedyrecently that Iraq sits on top of the third-largest oil reserves in the world,while producing less than 4 percent of the world's oil, noting that Iraq has agreat opportunity to increase its production of energy, as it seeks to increasethe production of 10 million barrels of oil per day by the year 2017. But theambitious agenda for this country faces many challenges as suffering from adilapidated infrastructure, and the scarcity of trained professionals, andsecurity and political environment is stable.

To that shows a professor at the Kennedy School MeghanO'Sullivan, who served in the White House and the Deputy National SecurityAdvisor for Iraq and Afghanistan from 2004 to 2007. "Because of thesefactors, the operational and logistics play a big role in whether Iraq will beable to reach the potential energy, the political factors will be equallyimportant, "For this reason, the paper focuses its work on the politicalissues that have received relatively little attention so far is" essentialto the smooth development of power in Iraq. "

The study points out that Iraq already gets 90 percent ofits revenue from the energy sector, and recover from the recent war depends toa large extent on the successful exploitation of the wealth of the country,which under the ground. There is a need for significant investment in publicworks, health, and education.

Wrote O'Sullivan, Director of the Geopolitics of EnergyProject at the Kennedy School, "The failure of production across thesocial and economic dimensions will put the political system's fragile Iraq isunder pressure," On the contrary, the increase in revenues from oil andnatural gas to help Iraq to support the young democracy, and rebuild itsmilitary, and re-influence in the region.

"Iraq has promised that a translation in the field ofenergy a reality," says O'Sullivan, is not in the interest of Iraq, butalso the entire international community. There is a global financial recoverywill lead to increased demand for oil, and if there can be no demand at currentprices, it will be driven by high prices. There has been an energy crisis ofthis kind in 2008, when oil prices hit $ 147 a barrel. And Iraq had a largereserve of oil can be offered on the Internet and relatively quickly, from atechnological standpoint, simply. Many of the Energy Outlook already rely onthe availability of large quantities of Iraqi oil in global markets. And thefailure of Iraq in the implementation of plans to expand production, at leastin part, it will contribute to another crisis, where the contraction of theenergy in the global economy.

But a number of political problems must be overcome beforeIraq is able to make any serious progress towards achieving the objectives ofenergy.Political stability is critical to the energy agenda in the country,while it can achieve this agenda, and almost paradoxically, help to enhancethis stability. A major obstacle is the difference between the centralgovernment in Baghdad and the Kurdistan Regional Government, as well asprovincial governments in all parts of Iraq. Simply put, in different parts ofthis country did not agree on how to develop and share resources.

The study shows, for example, the Kurdistan region, dozensof contracts granting licenses to international companies to develop oil andgas fields within its borders. The Baghdad government announced that thosecontracts are illegal and will not (until recently) to allow newly produced oilto flow in pipelines in Iraq. He left Kurdistan, landlocked, with oil, whichcan not export. The impasse eased last spring a bit, when Baghdad was the needof the oil revenues to finance the budget in 2011, allowing for the use ofKurdish pipelines. But there are still question the legitimacy of the Kurdistancontracts pending. And increases the complexity of the situation is the factthat Iraq is made up of smaller provinces, also want to know how they candevelop their resources.

At the same time, the future role of the United States inIraq remains unknown Convention signed in 2008 between the two countries, whichallowed the presence of U.S. forces in Iraq expires at the end of 2011. WhilePresident Barack Obama has said he will not renew this Agreement and theexpansion of a strategic framework agreement, and provide the basis forbilateral non-military relationship between the two countries.

And concluded O'Sullivan to say it was "our interest inmaintaining the partnership with Iraq, especially since many of ourpartnerships traditional in the region led to an abrupt end during the unrestthat occurred in the" Arab spring, "adding that" the idea thatthe United States want to access commercially to Iraqi oil is overlysimplistic, if not misleading, pointing to the attention of strategicimportance Akbar, "the existence of a stable Iraq could bring more oil tothe global market and benefit the Iraqi people and the world as a whole."

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