The crisis in Iraq will become a challenge for the world oil market with unpredictable influence on the prices, Daniel Yergin, founder of the Cambridge Expert Centre HIS CERA, said at a plenary session of the World Oil Congress.
Early June 2014 the rebels from the Islamic State of Iraq and Levant (ISIL) established control over the Iraqi province of Naynava by seizing its capital – Mosul city. About 600,000 people had to flee the city. Iraq is the second country after Saudi Arabia on the volume of proved oil resources. The actions of rebels have led to sharp growth of oil prices at the world market.
“The map of Near East could be revised. This means that the oil market will face new challenges. In the past it seemed that oil price of $20.00 per barrel is going to last forever. Just like at the oil price now,” Yergin added. Yesterday Professor Yergin told ITAR-TACC that at present situation in Iraq is more important for dynamics of the oil market, than sanctions against Russia.
“The issue of sanctions is mentioned at the talks, but a lot of other events are happening in the world. Now everything fades into the background of the crisis in Iraq. The question is whether Iraq will survive as a state. Earlier growth of deliveries from Iraq has stabilized the world market, but now this factor is not obvious. This is not only the issue of Iraq, but also of stability on the Near East,” he concluded.
BP Executive Director Robert Dudley hopes that the conflict in Iraq will not affect the oil production capacities on the south of the country. “These are terrible events with far-reaching consequences for the region. But the main production capacities are located far away from the conflict site, except for Kirkuk. I do not believe that these events will affect this field. We are very concerned about the situation in Iraq,” Dudley said at the World Oil Congress.
He also told the journalists that part of BP employees has left Iraq, but the company still continues working in the country.
The rebels’ actions have led to a sharp growth of oil prices at the world market.
