Oil market balanced on knife's edge
AFP, Paris
The recent sabotage of Iraq's oil pipelines has raised fresh concerns about production capacity and room for maneuver in case of a crisis amid firm global oil demand. A wave of attacks in Iraq this week paralysed the country's exports from its southern sea terminals. The southern oil fields had produced 1.6-1.8 million barrels per day before the spate of sabotage around Basra, 500 kilometres (300 miles) south of Baghdad. Repairs to the pipelines are expected to take five days. But meanwhile the oil market has suddenly found itself deprived of a substantial amount of crude. And with global oil demand on the rise due to strong economic growth in industrialised countries and China every little bit of oil counts. The International Energy Agency currently calculates global daily oil demand reached about 79.7 million barrels per day in the second quarter. The Paris-based organisation expects demand to rise to 80.6 million bpd in the third quarter and 82.6 million bpd by the end of the year. But as demand mounts, the crude producing members of the Organisation of Petroleum Exporting Countries have less and less extra supply to make up for any loss of Iraqi output.
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