Extremist force Islamic State of Iraq & Syria or ISIS is
making steady inroads into Iraq, and the exodus of multinational
energy players continue unabated. The latest to jump on the
bandwagon is integrated energy company
). The company has pulled back its oil drilling ventures in Iraqi
Kurdistan and has evacuated all non-essential personnel from the
The company, along with Irish oil and gas explorer Petroceltic,
owned stakes in the troubled Dinarta and Shakrok fields. Hess was
the majority stakeholder while Petroceltic has a 16% stake and the
Kurdistan regional government holds another 20%.
The exit comes close on the heels of significant reduction of Iraqi
presence by other major players like Exxon Mobil Corp. (
) and Chevron Corporation (
). Other players also evacuating key personnel include upstream
players like Canadian operator Oryx Petroleum Corporation Ltd and
London-based Afren Plc London. Oryx, one of biggest players in the
troubled area, led by ex ex-BP plc (
) boss Tony Hayward, however, still maintains its combined 230,000
barrel per day output from its Taq Taq and Tawke fields in Iraqi
The Iraq situation is no doubt unsettling, with developments on the
ground pointing toward a split in the country. But as we all know,
Iraq is no ordinary Middle Eastern country; it has the 5th largest
oil reserve in the world that it had only recently started tapping
after years of war and sanctions. No doubt global
have responded the way they have to the news flow out of that
West Texas Intermediate (WTI) crude futures were hovering around
$97 per barrel. Going forward, we feel the fate of oil price for
2014 is tied to the global GDP growth outlook, which in turn is
related to a mixture of better Europe and U.S. demand as well as a
stable growth in China demand. In 2013, oil prices did not improve
until we saw GDP growth improving in European countries and China.
As of now, oil supply fundamentals are building up for 2014 and
2015 on North American production. However, Russian supply concerns
have added to the Middle East (Iraq and Libya) worries.
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