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🇮🇶 Between Revenue Promises & Deficit Realities: What Iraq’s Oil Increase Really Means 🛢️💰
🔹 Baghdad’s Dilemma:
Iraq is caught in a familiar paradox — more oil, more revenue, but still not enough to solve its deep-rooted economic problems.
With a ballooning deficit, rising public sector wages, and heavy subsidies, even small gains in oil production are seen as a financial lifeline.
🔍 Key Highlights:
📈 Production Bump – But Just a Nudge:
OPEC+ approved an increase of 137,000 barrels/day starting October 2025.
Iraq’s share? Just +17,000 barrels/day, taking its total to 4.137 million barrels/day.
This is part of a gradual reversal of 2023 voluntary cuts.
💸 Limited Relief from a Growing Deficit:
While helpful, experts agree this increase only provides “a little breathing room.”
Its benefit is conditional on:
Stable oil prices, and
Efficient resource management – something Baghdad continues to struggle with.
⚠️ The Bigger Problem:
“Is it enough for Iraq to breathe a little every time oil goes up?”
No, say analysts.
The real issue is Iraq’s rentier economic model, where the state is overly reliant on oil, and every global price shockbecomes a national crisis.
🧱 Structural Problems:
No diversified economy
Weak domestic production
Excessive dependence on OPEC+ quotas and external factors
🌐 Geopolitical Risks Loom:
U.S. Sanctions Alert 🚨
Accusations of Iranian-Iraqi oil smuggling are triggering sanctions against Iraqi businessmen.
If Iraq’s main exporter SOMO is hit, it could:
Undermine revenue gains
Disrupt exports
Further entangle Iraq in global political tensions
🧠 Analyst Consensus:
Iraq may get temporary fiscal relief,
But without serious reform, the country will keep repeating the same crisis cycle with every dip or rise in oil.
Oil is a bandage, not a cure.
📌 Final Thought:
Iraq doesn't just need more oil — it needs a plan.
Until then, production gains are just small victories in a losing battle against a deep structural deficit.
🔗 Read Full Article on Baghdad Today
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